Is Ethereum Quasi-Centralized?

Are you surprised by my title?

I was a little bit uneasy with the title.

But I can't help asking this question about Ethereum.

I will give reasons for writing such strong allegations against the second-ranking cryptocurrency in terms of market cap after Bitcoin.

Let us discuss it with the science and technology of cryptocurrency in simple words.

What is the consensus layer for Ethereum?

It handles the state of the Ethereum blockchain, such as which transactions are valid and in what order the transactions are executed.

The Ethereum cryptocurrency uses the well-known Proof of Stake (PoS) consensus protocol to achieve this agreement among network participants.

How does a consensus layer client for Ethereum function?

A consensus layer client is essentially an Ethereum node.

A consensus layer is a software application that implements the consensus layer protocol.

The consensus layer application connects to the Ethereum network and helps maintain the Ethereum blockchain's security and integrity.

What is an execution layer for Ethereum?

An execution later is where all smart contracts and decentralized applications run.

It executes these programs and maintains their data.

How does the execution layer client for Ethereum function?

The execution layer application is used by users, developers, and decentralized applications to interact with the execution layer of Ethereum.

The execution layer allows users to execute transactions, deploy smart contracts, send query data, and interact with the decentralized applications.

Now, may I point toward a question to the Ethereum users?

• I read somewhere that the Geth (go-ethereum), an execution layer client for Ethereum, handles almost 61 percent of all the interactions with the Ethereum blockchain.

• I also read that Lighthouse and Prysm, which are two consensus layer clients for Ethereum, hold almost 76 percent of all the interactions.

• I further read about liquid staking in Ethereum or Lido.

• The Lido holds nearly 33 percent of all the Ethereum staked.

Are all these fine to maintain the decentralization of Ethereum?

Aren't those making Ethereum effectively quasi-centralized?

Final admittance.

• I am not an expert on cryptocurrencies.

• I read and write about cryptocurrencies which makes me curious.

• Ethereum's functioning makes me wonder what the experts would say about it.

Feel free to write a comment and throw more light on the subject.

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About me

I am a researcher and contribute to the overlapping areas of STEAM (Science, Technology, Engineering, Arts, and Mathematics). I am an active user and promoter of GNU/Linux, Free and Open Source Software. I develop cybersecurity and information security solutions, specifically graphical authentication security.

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#cryptocurrency #ethereum #decentralization #centralization #fintech

Nov 12, 2023