Ethereum’s move to PoS makes it much easier, if not easy, to manipulate Blockchains.
The Blockchain world is happy that the long-awaited implementation of “The Merge” change in the Ethereum network has occurred. Not everyone shares this optimism.
This change, which some have already called “the greatest milestone in the history of cryptocurrencies”, aims, among other things as one of its main objectives, to reduce the energy consumption of the network, thanks to the modification derived from the procedure of network mining execution, the “Proof-of-Work” consensus protocol, having changed it to the “Proof-of-Stake” protocol.
The Ethereum community has estimated that energy expenditure will be approximately 99.5% lower than before with PoW. If so, it will be great news for the entire planet; not so good news for the companies in the energy sector that profited at the expense of the miners; and not so desirable news, really, for those who think that Blockchain networks must be fully decentralized if they want to make a significant difference with other technologies.
The Merge: an evil for the decentralization of Ethereum
We have to start by looking at the distribution of mining nodes in the world. We could already observe, even before this milestone, a certain tendency towards centralization in large mining pools associated with venture capital funds, both in China and the US and, to a lesser extent, in other parts of the world.
This was not good news for the health of the Ethereum network since it ultimately meant that an “association” of these miners could alter the chain and, in the worst case, rewrite it. It had not happened yet because the difficulty of the PoW protocol counteracted that hypothetical plan of perverse associated miners.
There was no guarantee that a small miner could mine a block, as has in fact happened a couple of times this year, and ruin the plan.
The PoS protocol is based on the concept that a node that wants to be a validator must commit to the network, keeping a series of blocked ethers as a guarantee of its good work, and that the blocks are proposed by a validator and endorsed by a select group of other validator nodes.
Although the protocol establishes certain randomness in the assignment of validators from time to time, it is very likely that the pool, as a whole, can manipulate the data if the validators of the rounds are all “friends” associated with the same pool.
This would happen more frequently when the benefit now does not come from the mining process itself, but from the tips that the transactions leave to the validating miners, with which the lucrative business they previously had has diminished.
Vitalik Buterin always wanted to use Proof-of-Stake for Ethereum
In statements to certain media, Buterin has defended that he always wanted to have PoS from the beginning, but that he was advised to initially implement PoW in order to extend the Ethereum network to a large enough number of people and cause adoption of the technology along with a perverse situation of dependency of use cases on the network.
It is likely that PoW was used rather because it is a good decision decentralization algorithm, and because a few years ago there was no awareness of reducing the associated energy consumption, nor was there a war in Europe, or a global inflationary economic environment.
By Audy Castaneda
