Crypto

This important point that strengthens the centralization of Ethereum, which you need to understand – Mirror Mag

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BitMEX also highlighted the need for a complete overhaul of Flashbots or a similar system to mitigate unforeseen complications in the post-merger era.

Following the completion of The Merge upgrade, Ethereum (ETH) switched to a Proof-of-Stake (PoS) consensus mechanism, helping the blockchain become energy efficient and secure. However, mining data shows that Ethereum relies heavily on Flashbots — a single server — for building blocks, raising concerns about the ecosystem’s single point of failure.

Flashbots is a centralized entity dedicated to transparent and efficient Maximum Extractable Value (MEV) mining that acts as a relay for the delivery of Ethereum blocks. Data from mevboost.org shows that there are currently six active relays issuing at least one Ethereum block, namely Flashbots, BloXroute Max Profit, BloXroute Ethical, BloXroute Regulated, Blocknative, and Eden.

As shown above, 82.77% of all relay blocks were built by Flashbots alone, which greatly contributes to the centralization of Ethereum.

A related BitMEX blog pointed out the need for a complete overhaul of Flashbots or a similar system to mitigate unforeseen complications in the post-merger era. However, Flashbots proponents argue that the system is a decentralized autonomous organization (DAO) and will eventually become decentralized itself.

In addition to Flashbot dominance data, Santiment’s analysis shows that 46.15% of Ethereum PoS nodes are controlled by just two addresses.

According to our #Ethereum Post Merge Inflation Dashboard, 46.15% of #proofofstake nodes for storing data, processing transactions, and adding new #blockchain blocks can be attributed to just two addresses. This strong dominance of these addresses must be controlled. pic.twitter.com/KQdFNgGloD

“After the successful merger, most of the blocks – somewhere around 40% or more – were built at two addresses owned by Lido and Coinbase. It’s not ideal when more than 40% of blocks are settled by two providers, especially one that is a centralized service provider (Coinbase),” explained Ryan Rasmussen, Crypto Research Analyst at Bitwise.

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Passionate about cryptocurrencies and DeFI, Thomas brings international news on the subject!

Thomas E.
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