Vitalik Buterin reveals how to make Ethereum more decentralized

Ethereum creator Vitalik Buterin has always sought ways to make the network more decentralized. Recent research by Toni Wahrstätter expands on: buterin ideas About changes to how Ethereum rewards validators to support this goal.

This study focuses on the so-called “anti-correlation penalty.” At the moment, the network tends to be concentrated in a few large companies, as large groups operating a large number of Ethereum validators can save costs. However, if a large number of validators controlled by one operator fail simultaneously, it can put the entire network at risk. This is where new ideas come into play. If validators run by the same operator frequently fail together, they could be penalized, which would incentivize more diverse and independent validators.

Simply put, if more validators than usual miss the opportunity to confirm a transaction (certificates), they can be penalized. This helps keep Ethereum decentralized, making it less likely that one large validator will have too much control.

Wahrstätter's analysis examined over 40 days of data, including approximately 9.3 billion validator activities. This study envisions applying Vitalik's proposed formula to this data to see what changes.

For staking operators (entities that run validators), their effectiveness depends on size. Larger businesses could face heavier fines under the new regime, but smaller businesses could benefit. This is consistent with the idea that penalties discourage large-scale centralization. Interestingly, a category containing unidentified validators, perhaps solo stakers, also appears, suggesting the diversity of the network.

The analysis also considered the different software clients used by validators. The idea was that validators using the same software could face higher penalties if they failed together. The results were subtle, showing small variations from client to client, suggesting that the software was reliable.

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Armand Sirignan