Centralization issues on Ethereum. Ethereum is the second blockchain in terms of capitalization. However, it continues to fight for greater decentralization. Invited to the Korea Blockchain Week conference, Vitalik Buterin has also addressed the subject of the centralization of nodes.
Amazon Web Service: the Achilles heel of Ethereum
Like any blockchain, Ethereum is above all a network of nodes. These nodes are the heart of Ethereum. They provide, among other things:
- The availability of channel history;
- Verification and validation of transactions;
- The execution of smart contracts.
In total, the network is currently composed of 5870 knots. However, as Vitalik Buterin pointed out during the conference, the majority of these nodes are hosted with centralized providers. In practice, this represents 3362 knots.
Unsurprisingly, the service AWS from the giant Amazon comes first and captures 60% of the node market hosted on these centralized providers. Jeff Bezos’ company is followed by Google Cloud, Hetzner Online and finally the French OVH.
This poses a size problem. Indeed, in bug case on AWS or the implementation of a regulation resulting in the prohibition of nodes on service, 30% of network nodes would disappear.
According to Buterin, one of the reasons for this centralization is the resources needed to operate a node. Indeed, the latter must store hundreds of gigabytes of data.
To overcome this problem, Vitalik Buterin is also counting on the clients statelessor stateless, which have the advantage of working without having the historical data of the channel.
Thus, this type of wallet could be run on more modest hardware, for example mobile phones.
However, these will only appear during “The Verge” and “The Purge” phases of the roadmapnamely in several years.
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Same centralization for Ethereum customers
On the side of the customers used, the situation is hardly different. As a reminder, the customer is none other than the software used to operate the node.
Unlike other blockchains, Ethereum operates in a multi-client ecosystem. Therefore, it is possible to use several different software, again for the sake of decentralization.
Unfortunately, in practice the geth client is used by 84% of the nodes of the execution layer. Thus, in the event of a bug on geth, more than ¾ of the network nodes could end up offline.
A situation that is far from recent. Indeed, since the beginning of 2022, the Ethereum Foundation has been communicating on this subject and encouraging users to use other clients.
On the side of Liquid Staking protocols, decentralization is also at the heart of the debates. Indeed, several suppliers have undertaken toself-limit so as not to jeopardize decentralization. Unfortunately, the biggest player, namely Lido is missing.
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