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- Vitalik Buterin said that for staking ETH, the keys to access it have to be public, using multi-sig for safety but it’s quite difficult to set up multi-sig for staking.
- Cardano’s Charles Hoskinson said that he’s at a loss of words with other crypto community members stating that this shows a lack of confidence in the protocol.
The Ethereum blockchain network transitioned to a Proof-of-Stake (PoS) protocol last year with the historic Merge event. Ethereum co-founder Vitalik Buterin recently came out revealing his recently staked proportion for his ETH holdings.
During his recent podcast interview with Bankless last week on June 29, Buterin revealed the reason why he is staking only a very small portion of his ETH holdings. He said:
Probably the biggest reason why I am not personally staking all of my ETH and staking a fairly small portion is because if you stake your ETH…the keys that access it have to be public on some system that’s online. For safety, it has to be multi-sig and multi-sigs for staking are still fairly difficult to setup; it gets complicated in a bunch of ways.
However, not only Ethereum co-founder Vitalik Buterin, but other core team members are also in a similar situation. Ethereum’s Justin Drake stated that he too was in quite a similar situation. He said: “Personally, I’m staking a little bit less than the average…part of the reason [I’m not staking too much] is that when you make the sausage, you know how it is made.”
Crypto Community Reacts, Charles Hoskinson Lashes Out
Buterin’s explanation may be a bit complex, but that hasn’t stopped the community from criticizing it. They wonder why they should feel confident about Ethereum staking if one of its founders isn’t.
The community has responded strongly to this, with some comparing it to the founder of Dodge only driving short distances because they don’t trust the car for long journeys. Others have made similar remarks, suggesting that Vitalik Buterin’s statement implies a lack of trust in his own creation.
Cardano co-founder Charles Hoskinson has also made a similar comment noting: “I had to listen to this a few times. I’m just at a loss for words. All of our Ada is staked. Guess what that’s how it’s supposed to be for a properly designed Proof of Stake protocol”.
JUST IN:
Cardano founder Charles Hoskinson criticized Ethereum founder Vitalik Buterin for staking only a small portion of his ETH holdings, claiming that this shows a lack of trust in his own protocol.
— Whale | Dinobet.io (@WhaleChart) July 2, 2023
Buterin also talked about the EigenLayer protocol, which enables Ethereum validators and stakers to transfer their assets to other upcoming networks.
Although the protocol is still in its testnet stage and won’t be launched until the third quarter of 2023, Buterin mentioned that the main concern is the potential for “centralization risks”. The Ethereum co-founder added:
Trustworthy stakers would be valued more by the system than untrustworthy stakers. Trustworthy stakers are much less likely to actually get slashed.
According to Sreeram Kaanan, the founder of EigenLayer, there are various “complex risks” associated with restaking, and it is crucial to adopt a cautious and controlled approach when developing restaking mechanisms. We need to consider what is truly beneficial for the ecosystem and impose limitations on the innovations that can be introduced through this concept, he explained.
