Ethereum Faces Centralization Concerns
JPMorgan’s research report reveals that Ethereum has witnessed a surge in ETH staking following the Merge and Shanghai upgrades. However, this growth comes at a cost: increased centralization and reduced overall staking yields.
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JPMorgan’s research report reveals that Ethereum has witnessed a surge in ETH staking following the Merge and Shanghai upgrades. However, this growth comes at a cost: increased centralization and reduced overall staking yields.
To combat centralization concerns, Lido has been actively adding more node operators to prevent a single operator from controlling too much staked ether.
Despite these efforts, Ethereum’s centralization poses risks, says in JPMorgan.
A concentration of liquidity providers or node operators could act as a single point of failure or become vulnerable to attacks or collusion, potentially creating an oligopoly that prioritizes their interests over the broader community.
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