Ethereum under the control of 4 companies that can decide what they want, this is the end of decentralization!

All that has changed and most miners have transitioned or plan to transition to other Ethereum compatible coins, like Ethereum Classic, ERGO and the new ETHW fork. Today, Ethereum blocks are verified by validators and there are 429,278 validators. However, a large portion of the 13.7 million Ethereum blocks in play are held by four known providers.

4 known providers hold 59% of the Ethereum in play today.

Lido owned 30% of the Ethereum put into play four days ago. On September 15, the Twitter account Checkmate, the lead onchain analyst at Glassnode wrote about the entities that currently hold the largest shares of updates. “We profiled a few more entities,“Checkmate wrote To someone discussing Lido holdings. Checkmate said that the data shows that there are 13.7 million stakes. ETH and 10 million ether are held by known suppliers. This equates to 73% of the funds wagered. ETH and the top four suppliers hold 8.13 million. ETH or 59.3% of the total.

4.17M in Lido, 1.92M in Coinbase, 1.14M in Kraken, [et] 0.9M in Binance,” said Checkmate. The tweet shared by Glassnode’s onchain analyst was further discussed by popular bitcoiner Tuur Demeester, the editor of satoshipapers.org. “44% of ETH is put into play by just 2 entities, Lido [et] Coinbase. If we add Kraken, we go to 52% of the total. ETH staked out by 3 entities“, Demeester wrote. The publisher also has made fun of a tweet written by Vitalik Buterin that talks about the idea of having the system validated by average users.

Proof-of-work supporters question validator censorship while 59% of Ethereum is owned by 4 companies.

SEC Chairman Gensler suggests coin staking needs to be revisited, Jack Dorsey shares anti-PoS editorial, Ethereum supporters think people are moving too fast.

In addition to bitcoiners like Demeester and Checkmate, U.S. Securities and Exchange Commission Chairman Gary Gensler recently spoke out about the Howey test and coin staking. The Wall Street Journal (WSJ) reported that Gensler said, “From the coin’s perspective … it’s another indication that, under the Howey test, the investing public anticipates profits based on the efforts of others.“Although the WSJ said Gensler noted that he was not referring to any particular crypto-currency, many crypto-currency enthusiasts assumed that the SEC chairman was discussing ethereum and PoS coins.

In mid-August, Coinbase co-founder and CEO Brian Armstrong was asked if the exchange would censor at the ethereum protocol level with validators. “If regulators ask you to censor at the ethereum protocol level with your validators, will you (A) comply and censor at the ethereum protocol level with your validators?“. [le] Protocol level (B) Close the staking service and preserve network integrity? “, asked the user.

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Armstrong responded to three days later and said: “That’s an assumption that we hope we don’t have to face. But if we did, we would go with (B), I think. We have to focus on the big picture. There may be a better option (C) or a legal challenge that could help achieve a better outcome.

Proof-of-work advocates question validator censorship while 59% of Ethereum is owned by 4 companies.

A number of people believe that it is entirely possible that known validators will be forced to comply with regulatory policy and censorship. With four centralized entities holding the most ethereum today, people are concerned about whether validators will be centralized and censor transactions. On September 14, Twitter co-founder Jack Dorsey shared An editorial published on substack.com that criticizes the PoS.

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Meanwhile, most of the criticism comes from bitcoiners, some of whom are labeled as bitcoin maximalists. Ethereum supporters think the idea is absurd, and one of them noted that he would simply switch to a money exchange system. ETH chain that does not censor transactions. “Guys,” tweeted Ryan Adams, “[le gouvernement amΓ©ricain] don’t try to censor [ethereum] validators at this time. Let’s not get carried away. But … if they ever do … I’ll be on the Ethereum fork that doesn’t censor transactions. It’s as simple as that. Layer 0 is our security layer“, Adams added.

Proof-of-work supporters question validator censorship while 59% of Ethereum is owned by 4 companies.
Images shared by Eric Wall on September 16, 2022. The image on the left was originally shared by Banteg, and the image on the right was originally shared by Alex Svanevik.

Bitcoin supporter and blogger, Eric Wall, published on a Twitter feed on September 16 that details in the case of the Lido staking, “Lido isn’t even a pool“. Wall further notes in his thread that “Lido cannot decide which blocks each of its underlying node operators exploits.“Wall does discloses That he is an investor in LDO, as lido dao (LDO) is the native governance token for the Lido Finance project.

Lido also cannot fire any of its node operators or take away their stake as things stand. No more than 13.1% of Lido’s validators are based in a single country. The geographic distribution is actually quite impressive“, Wall’s Twitter feed adds.

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