Tag

Centralization

All articles tagged with #centralization

SEC Approves Ether ETFs Amid Security Concerns and Market Volatility
financetechnology1 year ago

SEC Approves Ether ETFs Amid Security Concerns and Market Volatility

Experts warn that the newly approved U.S. spot Ethereum ETFs could pose significant security risks if staking is introduced, due to potential centralization and concentration of power among a few custodians. This could expose the Ethereum network to operational risks and malicious collusion, as seen with the centralization concerns around liquid staking provider Lido. The SEC's stance on staking as a securities service has led to its exclusion from ETF applications, but without guidelines to mitigate these risks, the potential for validator concentration remains a serious concern.

Ethereum's Staking, Transaction Fees, and Price Predictions: A Year in Review
cryptocurrency2 years ago

Ethereum's Staking, Transaction Fees, and Price Predictions: A Year in Review

A year after Ethereum's transition from proof-of-work to proof-of-stake, known as the Merge, the blockchain's energy consumption has fallen by 99.9%. However, Ethereum still faces challenges related to centralization, censorship, and exploitation by infrastructure intermediaries. Stake distribution raises concerns about centralization, as the largest staking provider, Lido, nears the 33% threshold that could compromise security. The practice of maximal extractable value (MEV) has become a source of centralization and censorship, with Flashbots playing a controversial role. Liquid staking tokens have gained popularity, offering an alternative to traditional staking. The net supply of ETH is decreasing, making it deflationary, but its impact on value remains uncertain.