HomeFinance NewsVitalik Buterin Worries About DAOs Endorsing ETH Staking Pool Operators

Vitalik Buterin Worries About DAOs Endorsing ETH Staking Pool Operators

Published on

Vitalik Buterin, the co-founder of Ethereum, has raised concerns about decentralized autonomous organizations (DAOs) having a monopoly over the selection of node operators in liquidity staking pools. In a blog post, Buterin warns that as staking pools adopt the DAO approach for governance, it exposes them to potential risks from malicious actors. He emphasizes the need for multiple layers of protection to safeguard against such risks, as relying on just one layer may prove insufficient. Buterin mentions Lido as an example of a liquid staking provider with a DAO that validates node operators but cautions that this is not enough to prevent attacks.

Buterin also discusses the risks associated with becoming a node operator through the Rocket Pool approach, which requires an 8 Ether deposit. He highlights the possibility of attackers performing a 51% attack on the network and forcing users to bear most of the costs. However, he acknowledges the necessity of having a mechanism to determine who can act as underlying node operators, as unrestricted access would enable attackers to amplify their attacks with users’ funds. To address this issue, Buterin suggests encouraging the use of a variety of liquid staking providers to reduce the likelihood of any single provider becoming too large and posing a systemic risk.

In the long term, he cautions against relying solely on moralistic pressure to address these problems, stating that it is an unstable equilibrium. This highlights the need for a more comprehensive approach to ensure the security and integrity of decentralized systems.

Source link

Latest articles

What Is Outdoor Lighting Service and Why Is It Necessary?

Outdoor lighting services involve the design, installation, and maintenance of lighting systems for exterior...

The Complete Guide to Paver Sealing Services: What, Why, and Who to Hire

Paver sealing services are essential for preserving and enhancing the beauty of outdoor spaces...

Excavation Services: What They Are and Why You Need Them

Excavation is the process of preparing a site for construction or land improvement by...

The Essential Guide to Pressure Washing: What It Is, Why It Matters, and Finding the Best Professionals

What is Pressure Washing? Pressure washing, also known as power washing, uses a high-pressure water...

More like this

What Is Outdoor Lighting Service and Why Is It Necessary?

Outdoor lighting services involve the design, installation, and maintenance of lighting systems for exterior...

The Complete Guide to Paver Sealing Services: What, Why, and Who to Hire

Paver sealing services are essential for preserving and enhancing the beauty of outdoor spaces...

Excavation Services: What They Are and Why You Need Them

Excavation is the process of preparing a site for construction or land improvement by...