Ethereum co-founder Vitalik Buterin has raised concerns about the growing centralization within the network, warning that large stakers dominating block creation could lead to security risks and censorship of transactions. He emphasized that such concentration of power makes Ethereum more vulnerable to network attacks and limits the benefits for regular users.
In October, two entities—Beaver and Titan—were responsible for nearly 90% of the blocks created on the Ethereum network, highlighting the centralization issue. Buterin explained that this level of control increases the likelihood of 51% attacks and the extraction of value by a small group, undermining Ethereum’s principles of decentralization.
Inclusion Lists and Staking Caps as Potential Solutions
To combat these risks, Buterin proposed several ideas. One suggestion involves using “inclusion lists,” where responsibility for building and proposing blocks is divided between two parties—builders and stakers. The builder helps organize transactions, while the staker selects which ones to include, promoting a more decentralized system.
Another issue Buterin raised concerns staking. With 34 million ETH currently staked—nearly 30% of the total supply—he cautioned that the dominance of a single liquid staking token (LST) could harm the network’s liquidity and decentralization. To address this, the team is evaluating options like capping the amount of ETH that can be staked and reducing staking rewards.
Buterin stressed that the goal of these proposals is to prevent centralized actors from capturing value and ensure that Ethereum remains a decentralized and resilient network. Following these discussions, Ethereum’s market sentiment improved, with ETH gaining momentum.
As of now, ETH is trading at $2,713, reflecting a 3.55% increase in the past day and an 11.65% rise over the past week. The final impact of these proposed solutions will play a key role in determining Ethereum’s long-term stability.
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