Is PoS Ethereum more centralized? Two platforms add 42% of Ethereum blocks after merger by DailyCoin

Is PoS Ethereum more centralized? Two platforms add 42% of Ethereum blocks after merging

The merger was a hit by all accounts, as the network switched from Proof of Work (PoS) to a PoS consensus mechanism, thus reducing its power consumption by 99.9%. However, the move raised questions about the decentralization of Ethereum.

Concerns about post-merger centrosome fermentation

The early days of the merge raised major central concerns around the network. On-chain data shows that hours after the merger, two entities were responsible for adding approximately 42% of the blocks on the Ethereum network.

Martin Kopelman, co-founder of the Gnosis chain, reported that of the first 1,000 ETH blocks after the merger, 420 were added by Coinbase (NASDAQ:) and Lido Finance, with the Ethereum service Lido accounting for 27% of all validations.

Ethereum’s top seven validators now contribute to 67.6% of all blocks on the chain, leading to centralization concerns and a 51% attack potential due to the possibility of validators monitoring transactions from certain blockchain addresses.

Why does Ethereum appear centralized?

The main reason why only a few entities account for such a large percentage of the Ethereum block generation is due to the high capital requirements (32 ETH, or roughly $50,000) for individuals to participate and become certified.

This has led to ETH holders turning to platforms like Coinbase and Lido, which offer small pools where stakes as low as 0.1 ETH are possible. By using these sharing platforms, users can become auditors and earn rewards.

on the flip side

  • While Ethereum has come under scrutiny, Kopelman highlights that it has a similar problem, with only 4 entities making up more than 72% of all blocks.

Why should you care

Ethereum centralization concerns are seen as a huge problem, especially due to the fact that the blockchain has been designed to solve this particular problem, among other things.

Find out how to merge:

Ethereum is now a proof-of-stake network after the merger without a hitch

For more information about Lido, read:

Lido DAO (LDO): project review, recent developments, future events, community

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