Ethereum co-founder Vitalik Buterin stakes a small amount of his ETH due to security concerns and the complexity of keeping it safe.
speaking in the podcast without bankButerin said he does not stake all of his Ethereum, just “a fairly small portion” because staking securely on the network requires multiple signatures, which is still a complicated process.
“If you stake your ETH, the keys to access it must be public in some system that is online. For security, it has to be a multi-sig, and multi-sigs for staking are still quite difficult to set up. It gets complicated in many ways.”
Multi-sig refers to requiring more than one user to sign and authorize a transaction. Therefore, cryptographic assets remain secure even if a private key is compromised.
In 2021Ethereum Foundation researcher justin drake He said that he does not stake all his ETH. In explaining why, he used an analogy with making sausages, adding that rare and unpredictable events also played a role in his decision.
“When you make the sausage, you know how it’s done, and there’s a lot of tail risk that’s hard to quantify.”
CEO of Input-Output and founder of Cardano charles hoskinson seized on Buterin’s comments and said that he bets all of his ADA, taking the opportunity to infer that Ethereum is not “designed correctly.”
“I had to listen to this a few times. I am speechless. All our Ada is bet. Guess what, this is how a properly designed proof-of-stake protocol is supposed to look like.“
However, Max Radeleus, the co-founder of INTUa protocol that introduced dEOAs (externally owned decentralized accounts) to ETHDenver this year, argued that Buterin might be underestimating what is possible with Ethereum’s continued innovation.
EOAs are the most basic type of Ethereum accounts that use a public and private key pair. INTU introduced a cryptographic method for splitting private keys without the need for a smart contract wallet, the kind of account Buterin is probably referring to when he talks about multi-signatures.
“As Mr. Buterin so succinctly points out, secure on-chain solutions are currently difficult; I mean, if he has a problem with that, who wouldn’t? However, we are not done innovating on Ethereum yet! dEOAs simplify the launch of multi-party accounts (MPCs) which solves many of Vitalik’s problems here, and perhaps, this is what is needed for greater participation adoption.”
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