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What we see in the Tezos chain (liquid/delegated proof-of-stake) is that big custodial wallets for the exchanges have grown to be the largest block bakers: http

by erwinh 4y ago

What we see in the Tezos chain (liquid/delegated proof-of-stake) is that big custodial wallets for the exchanges have grown to be the largest block bakers: https://thestackreport.xyz/articles/top-tezos-block-producers-tsr-weekly-16-22 https://thestackreport.xyz/articles/top-tezos-block-producer... With ethereum the staking mechanism is a bit more complex, my understanding is you lock your stake for quite a while so maybe its too risky for the exchanges, but wouldn't be surprised that exchanges will market a 'stake your eth' feature.

zionic 4y ago
ETH PoS includes offline penalties proportional to the % of the network that goes down. If your home RasPi validator drops you don't lose much. If 25% of users stake on coinbase and _they_ go down the penalties are much higher. So there's an incentive to validate on your own hardware/connection.
- mattnewton 4y ago
  If that were true why wouldn’t coinbase just stake through a few hundred different vms on servers instead of one block of nodes? Or is there some mechanism that ties it to a legal person / corporation?
chizhik-pyzhik 4y ago
Coinbase is already offering an eth staking service: https://help.coinbase.com/en/coinbase/trading-and-funding/coinbase-earn/eth-2-0-staking https://help.coinbase.com/en/coinbase/trading-and-funding/co... It remains to be seen how much further staking will centralize. So far the distribution isn't so bad: https://i.redd.it/5lhlmwdg27j91.png https://i.redd.it/5lhlmwdg27j91.png
- warkdarrior 4y ago
  There are fewer staking pools in that chart than there are traditional banks in the US! https://www.statista.com/statistics/184536/number-of-fdic-insured-us-commercial-bank-institutions/ https://www.statista.com/statistics/184536/number-of-fdic-in...
  - stablefusion 4y ago
    difference is that a blockchain can always fork away from corrupted entities. (bitcoin -bitcoin cash fork in 2017)
zeroclip 4y ago
There’s already a bunch of delegated staking options for ETH2, including Lido, RocketPool and Coinbase.[1] Once withdraws are enabled this landscape may change. There is a lot more work that needs to be done to improve decentralized staking pools, if they continue to expand they can consume large percentage of the total staked Eth with less concern than centralized staking services like Coinbase. One of the big problems with Tezos is that the governance is tied to the stake. This means in practice most users will not have much of a say in governance because the largest stakers will consume most of the votes. The only thing that has stopped this so far is that large CEX stakers are voting Pass, but this act of goodwill may not always be the case in the future. [1] https://research.paradigm.xyz/staking https://research.paradigm.xyz/staking
deleted 4y ago
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by erwinh 4y ago

zionic 4y ago

ETH PoS includes offline penalties proportional to the % of the network that goes down. If your home RasPi validator drops you don't lose much. If 25% of users stake on coinbase and _they_ go down the penalties are much higher. So there's an incentive to validate on your own hardware/connection.

mattnewton 4y ago
If that were true why wouldn’t coinbase just stake through a few hundred different vms on servers instead of one block of nodes? Or is there some mechanism that ties it to a legal person / corporation?

chizhik-pyzhik 4y ago

Coinbase is already offering an eth staking service: https://help.coinbase.com/en/coinbase/trading-and-funding/coinbase-earn/eth-2-0-staking https://help.coinbase.com/en/coinbase/trading-and-funding/co... It remains to be seen how much further staking will centralize. So far the distribution isn't so bad: https://i.redd.it/5lhlmwdg27j91.png https://i.redd.it/5lhlmwdg27j91.png

warkdarrior 4y ago
There are fewer staking pools in that chart than there are traditional banks in the US! https://www.statista.com/statistics/184536/number-of-fdic-insured-us-commercial-bank-institutions/ https://www.statista.com/statistics/184536/number-of-fdic-in...
- stablefusion 4y ago
  difference is that a blockchain can always fork away from corrupted entities. (bitcoin -bitcoin cash fork in 2017)

zeroclip 4y ago

There’s already a bunch of delegated staking options for ETH2, including Lido, RocketPool and Coinbase.[1] Once withdraws are enabled this landscape may change. There is a lot more work that needs to be done to improve decentralized staking pools, if they continue to expand they can consume large percentage of the total staked Eth with less concern than centralized staking services like Coinbase. One of the big problems with Tezos is that the governance is tied to the stake. This means in practice most users will not have much of a say in governance because the largest stakers will consume most of the votes. The only thing that has stopped this so far is that large CEX stakers are voting Pass, but this act of goodwill may not always be the case in the future. [1] https://research.paradigm.xyz/staking https://research.paradigm.xyz/staking

deleted 4y ago

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