Buterin offers solutions for Ethereum stop, block production issues

Ethereum co-creator Vitalik Buterin laid out several solutions to help Ethereum reduce block production and centralization through the “eclipse” phase of Ethereum's technical roadmap.

In a post on October 20, Buterin expressed his concern that economies of scale in staking will result in smaller pools leaving for larger pools, but two parties have built 88% of Ethereum blocks in the first two weeks of this month.

Buterin warned that decentralization would pose “a huge risk” to Ethereum, risking massive transaction censorship and “other crises.” And so he said.

“One of the biggest risks for Ethereum L1 is the decentralization of shares due to economic pressures.”

Buterin said that currently 30% of Ether (ETH) is already more than enough to protect Ethereum from 51% of attacks, but with almost all of Ether, additional risks may arise.

Buterin said staking is less of a “feasible practice” and imposes additional obligations on Ether holders, adding that the staking mechanism will be weakened and that liquid staking tokens may take away the results of the “money” network from Ether.

To address these issues, Buterin recommends capping the amount of Ether a user holds and limiting share penalties to 12.5% ​​of Ether held.

This can be achieved by using a two-level “risk-bearing” (decomposable) and “fleece-free” (non-destructive) statistical model.

The concern over the centralization of block production comes after Ethereum Foundation researcher Tony Wahrster recently reported that two Ethereum block developers — Beaverbull and Titan Builder — built 88.7% of Ethereum blocks in the first two or so weeks of October.

Ethereum follows a proponent-builder separation mechanism for block building. Builders create blocks for the supplier to evaluate, often choosing the most profitable.

However, assigning “special” tasks to certain actors has led to problems of centralization, Buterin.

Related: Ethereum, L2s to ‘Surge' Over 100K TPS – Vitalik Buterin

While Ethereum's security is not at risk, Buterin said the issue could lead to worse transaction censorship, forcing Ethereum users to wait up to 114 seconds to block instead of 6 seconds.

This delay could give developers more time to extract user income through sandwich attacks, or create “significant market manipulation” with decentralized financial liquids.

Buterin proposed “inclusion lists implemented with fork selection” where the task of selecting transactions is returned to the provider or shareholder, and the developer only chooses how the transactions are ordered (in addition to inserting some of their own).

An alternative solution is a proposal called BRAID, which divides the block production process between different actors, each of which only needs a “moderate amount of complexity” to maximize their revenue.

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