📊｜ETH and the problems that need to be solved by L2 decentralization

——————————————————

📢As the second largest cryptocurrency by market value, the centralization problem of ETH's network has always attracted much attention. Currently, both the Ethereum mainnet and the L2 expansion plan face centralization risks, which pose a threat to its security, anti-censorship and long-term development

The centralization problem of the ETH mainnet is mainly reflected in staking. At present, the three major institutions, Lido, Coinbase and Binance, control more than 85% of the liquidity staking validators, far exceeding the 15% previously expected by Vitalik. This degree of centralization makes the Ethereum network vulnerable to regulatory pressure and single point failure.

🔻Ethereum L2 expansion plan also has centralization problems. The ETH assets of mainstream L2s such as ARB, OP and Base are all hosted in multi-signature wallets controlled by a few companies, which completely violates the original intention of decentralization and the principles of Web3.

Why I think most L2s will not be decentralized. Because of the incentive mechanism, asking them to decentralize is like asking them to cut off their own arms with a knife

🔥For the centralization problem of ETH mainnet and L2, the following solutions may be adopted:

1️⃣, Encourage decentralized staking: Through protocol upgrades or community initiatives, encourage users to choose decentralized staking service providers to reduce the market share of giants such as Lido.

2️⃣, Promote L2 decentralized governance: L2 project parties should actively promote the decentralized governance of multi-signature wallets, gradually transfer control to the community, and improve transparency.

3️⃣, Explore more decentralized expansion solutions: In addition to Optimistic Rollup and ZK Rollup, other more decentralized expansion solutions, such as state channels and side chains, can also be explored to reduce dependence on a few L2s.

4️⃣, Improve node diversity: Encourage the use of different client software to run nodes to avoid large-scale node failures caused by single client bugs.

♦️In general, solving the centralization problem of Ethereum is a long and complex process that requires the joint efforts of developers, communities, and users. Through technological innovation and governance optimization, the centralization risk can be gradually reduced and a more decentralized, secure, and sustainable Ethereum ecosystem can be built.#以太坊基金会