Developers led by Mike Neuder believe that a contraction of the validator set has positive implications for the beacon chain decentralization roadmap, the current p2p layer, and validators.
The Ethereum (ETH) network is best described as art in progress amid blockchain and mainstream crypto adoption. With proof-of-stake (PoS) still young under the beacon chain, Ethereum core developers continually engage each other in ways to help the decentralization aspect. Furthermore, the Ethereum network accommodates global investors and also different countries with different sets of crypto regulatory policies. As a result, constant development to incorporate new DeFi and users with different requirements has helped the network stay at the top of the smart contract industry.
A closer look at Ethereum’s proposal to increase MaxEB
According to Ethereum proposals from leading researchers and developers, including Mike Neuder, Francesco d’Amato, Aditya Asgaonkar, and Justin Drake, the current maximum effective balance (MaxEB) is a limit to Ethereum’s decentralization progress. Also, a low MaxEB increases the set of validators without necessarily increasing the available individual nodes. Essentially, individual Ethereum participants became validators by investing 32 ETH through the beacon chain; however, an investor may decide to delegate several thousand ETH to a staking program, which adds validators.
According to Ethereum on-chain data, there are around 600,000 validators with more than 90,000 in the activation queue. As a result, the Ethereum developers propose to increase the MaxEB without increasing the minimum amount required to become a validator.
“We argue that increasing the MaxEB (i) unlocks future updates to the consensus layer in roadmap 4, (ii) improves the performance of the current consensus mechanism and the p2p layer, and (iii) improves operational efficiency for validators. small and large scale. ,” the proposal noted.
According to an Ethereum validator on Twitter Vizsla (@AnotherVizsla), the immediate benefit of increasing MaxEB for individual players is the ETH reward mix. As a result, individual Ethereum participants can now compete with large entities such as Lido (LDO), Coinbase Global Inc (NASDAQ:COIN), and Kraken, among others, who operate liquid staking programs.
For individual validators, the most immediate benefit of an increase in MAX_EFFECTIVE_BALANCE would be to allow instant accumulation of ETH rewards simply by leaving them in the existing validator. Suddenly, solo takers can compete with large operations. https://t.co/8K7nN43dDh
— Vizsla (@AnotherVizsla) June 6, 2023
Ethereum researchers reportedly want MaxEB to be capped at 2048 ETH, which would drastically reduce the current number of validators. The details of the proposal are open for discussion before the validators vote on the way forward.
Market outlook
The Ethereum network remains the undisputed leader in the decentralized finance ecosystem and smart contract adoption. According to aggregated market data provided by Defillama, the Ethereum network has a total value locked (TVL) of approximately $24.7 billion with approximately 100 million non-zero addresses. On Monday, Ethereum (ETH) was trading around $1,727 and had a total market capitalization of around $208 billion and a 24-hour trading volume of about $4 billion.
next
Let’s talk about crypto, Metaverse, NFT, CeDeFi, and Stocks, and focus on multi-chain as the future of blockchain technology. We all WIN!