Analysis from Santiment specifyThat 46.15% of Ethereum’s PoS nodes are controlled by just two wallet addresses.
After the Merge, the first wallet address was validated for approximately 188 blocks, or 28.97% of nodes, and the second wallet address was validated for 16.18%, or 105 blocks. User debate about the impact of the Merge as a centralization for the world’s largest network.
Prior to the Merge, blockchain analytics platform Nansen published a report atshowThe report shows that five of them hold 64% of all staked Ether, with Coinbase, Kraken and Binance accounting for nearly 30% of the ETH staked. Hands of a centralized web service provider such as Amazon Web Services (AWS).
“Since the Merge is complete, most blogs — around 40% or more — have been created by two wallet addresses owned by Lido and Coinbase, which is unfitting that more than 40% of blogs are judged by the two providers. In particular, centralized service providers (Coinbase),” explains Ryan Rasmussen, crypto research analyst at Bitwise.
PoS is believed to often lead to centralization because it favors those with higher token volumes than those with lower volumes. For example, the PoS mechanism in the Ethereum blockchain relies on validators, not miners, to verify transactions. It requires stake 32 ETH, which is roughly $48,225 at the present time.
However, PoS proponents argue that this mechanism is safer and more environmentally friendly than PoW, with Ethereum co-founder Vitalik Buterin predicting that the change will not only reduce power consumption by around 95%, but also help scale. The network with transaction processing is expected to be equivalent to a centralized payment processor. This feature is expected to be available in the second half of 2023.
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