Ethereum Blockchain Centralization Vs. Decentralization By Vitalik Expectations Are Brewing About a Second Wave Up

There was an epic weekly surge, and ETH is struggling to break beyond the resistance level.  There are expectations that ETH will reclaim its $200 level as a second wave up. However, several traders are expected to opt-out as nearly 2 million ETH addresses are in the money, and the breakeven point has reached.

Sydney Ifergan, the Crypto expert, tweeted:  “Ethereum (ETH) or any other cryptocurrency of any kind should be usable, failing which it makes no sense.  The value factor is derived from cryptographic scarcity.”

Vitalik recently spoke about the benefits of “deliberately engineered and bounded centralization.”

Vitalik tried to compare situations and stated that when a single person has a large stake + influence in an outcome, then they will take the time to learn and to optimize and make use of the economics of scale to make and execute good decisions.

Centralization is considered risky because of the risk of abuse of power, fragility, low bus factor etc.

However, when a million people have a small stake in an outcome and are able to influence it in a small way, they are not going to care and are led astray by side incentives.

When the two are combined like in a blockchain Vitalik opines that will be the most resilient of all architectures. For instance, he reflected on how miners and transaction processing sometimes take place in private deals; however, the benefits of such are very less.

The bounded downside he stated is about one block producer waiting 15 seconds for the next one. When there are complex challenges with complex apps, on-chain optimal transaction inclusion becomes necessary, which includes capturing of miner extractable value, this introducing an edge for sophisticated block producers, risking centralization.  The solution here, Vitalik states, is deliberately engineered bounded centralization where the consensus is split into two tasks. First, being deciding which transactions goes to blocks.  The next is about verifying other blocks…

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