Vitalik Buterin explored several potential improvements that could make the cost of supporting Ethereum lower and the overall speed faster.
It turns out that despite years of technical patching and debate, Vitalik Buterin is not satisfied with his first reform of Ethereum's consensus mechanism.
In a blog post on Monday, the Ethereum co-founder pondered several potential improvements to the Ethereum proof-of-stake model. These include lowering the financial threshold for individual stakers, and shortening the time required to confirm Ethereum blocks.
Two years ago, the "Merge" fundamentally changed the way Ethereum transactions are verified. Ethereum no longer relies on an energy-intensive computer network to ensure network security, but has transitioned to a system where validators dedicate assets to the network.
Validators are rewarded for assembling transaction blocks and proving the accuracy of other transactions. To participate in this process, validators lock up 32 ETH (84,000 USD), essentially as skins in the game. However, Buterin believes the threshold can be significantly lowered to 1 ETH (2,600 USD).
"Poll after poll has repeatedly shown that the main factor preventing more people from staking individually is the 32 ETH minimum," he wrote. "Lowering the minimum to 1 ETH would solve this issue, to the point where other issues become the main limiting factor for individual staking."
Recently, the speed at which new validators are protecting the Ethereum network has slowed down. According to data from beaconchai.in, since over 1 million active validators joined in April, around 73,000 validators have joined. This number has approached 3,000 in the past month.
Lowering Ethereum's staking requirements for validators could also address some of the network's centralization issues. According to the Dune dashboard, the leading liquid staking ETH decentralized platform Lido Finance currently accounts for 28% of all staked Ethereum.
The second part of Buterin's proposed improvements mainly focuses on transaction finality. This term refers to Ethereum transactions that are contained in blocks that cannot be altered.
Buterin wrote that as of now, Ethereum transactions take about 15 minutes to complete. This is because Ethereum's progress is measured in epochs that occur every 6.4 minutes. Each epoch consists of 32 slots, with a new block typically produced every 12 seconds.
As Blocknative's Chief Technology Officer and co-founder Chris Meisl explained, after two epochs have passed, it becomes economically infeasible for an attacker to revert Ethereum blocks. At that point, "you can consider it very secure," he wrote in a blog post last year.
Buterin wrote that "single-slot finality" would reduce the finality time to every 12 seconds. He wrote that combined with the lower staking requirements, it would "align Ethereum's properties with those of (more centralized) performance-focused [layer-1] chains."
However, Buterin acknowledged that there are several ways for single-slot finality to work, ranging from a brute-force option involving advanced cryptography to a two-tier system targeting stakers.
Buterin's blog post comes against the backdrop of increasingly heated debates around Ethereum's layer-2 networks. While Ethereum's Dencun upgrade in March provided them with a new way to offer users lower transaction costs, it also led to a period of inflation in Ethereum's circulating supply.
Meanwhile, Ethereum's core developers are preparing for the network's next major upgrade, Pectra. The first part of the upgrade also adjusts the way Ethereum stakers earn rewards, and is expected to be released sometime early next year.
