Ethereum co-founder Vitalik Buterin proposes drastic changes
Ethereum (ETH) co-founder Vitalik Buterin proposed making low-level changes to how the blockchain he helped build works.
Buterin proposed several changes to Ethereum’s proof-of-stake (PoS) consensus protocol in a blog post. The project’s co-founder recognizes that the transition to PoS was a significant step forward, but he is not yet satisfied with how the network is running:
“Today, Ethereum has been a stably running proof of stake system for almost exactly two years, and this proof of stake has performed remarkably well in stability, performance and avoiding centralization risks. However, there still remain some important areas in which proof of stake needs to improve.”
What is proof-of-stake?PoS is a consensus algorithm. Algorithms of this kind are procedures employed to ensure that a blockchain’s network participants achieve the data kept on-chain — for instance, the balances of all addresses.
PoS is significantly different from proof-of-work, the consensus algorithm employed by the world’s first blockchain, Bitcoin (BTC). Instead of investing great amounts of computing power (and electricity) into securing the network, PoS, so-called stakers secure the blockchain by putting their assets at stake.
If stakers are found to misbehave by attempting to validate incorrect transactions, their stakes are slashed, and they lose capital. The minimum amount of Ethereum required for independent staking is 32 ETH — worth about $83,370 at the time of writing.
One of the measures proposed by Buterin is to lower the 32 ETH requirement to just 1 ETH. While also those holding under 32 ETH can participate and earn ETH rewards from staking, they can only do so by delegating and not independently. This results in a lower number of stakers that independently ensure the network runs properly, and a lower decentralization.
Another proposal would lower block finalization time from 15 minutes down to a little more than 10 seconds. Other suggestions include advanced signature aggregation to improve efficiency, a two-tier staking system with different capital requirements and more.
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