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0 pointsTenoke5y ago0 comments

Okay, admittedly it's not quite there yet but by the end of march 100% of blocks will be produced by independent stake pool operators. The number of current pools is somewhat misleading - switching between them is frictionless, more will keep being added, and there are rules in place so they can't grow too much (staking rewards decrease quickly) and the average # of ADA per wallet is dropping (<100k/wallet average now).

I should've really said the most decentralized alternative option but even in terms of biggest holders ETH is more top heavy (many controlled by the same people as you said).

> but there's a much easier barrier to entry for new validators.

Is it? The minimum to run a validator is 32 ETH[0] while there isn't even a minimum for ADA. 4 GB of RAM and 1 GB bandwidth[1] (for ADA) isn't much of a deterrent either.

0. https://ethereum.org/en/eth2/staking

1. https://forum.cardano.org/t/a-guide-to-becoming-a-stake-pool...

0 comments

flixic5y ago

> there are rules in place so they can't grow too much (staking rewards decrease quickly)

I think this refers to the k factor, that puts the "soft limit" on decentralization. This I see as a barrier to entry: Ethereum 2.0 is 32ETH and that's it. Cardano has no monetary fee, but has eventual competition between pools, which is variable, likely ongoing cost. Barrier to entry is less defined, and could at some point grow beyond dollar value of 32 ETH (to become a competitive pool). Whereas Ethereum 2.0 will always stay a constant 32 ETH, no matter how many validators exist.

TenokeOP5y ago

There might be competition between pools but also costs for them to grow beyond a point which benefits decentralization - the issue at hand.

What does it matter here if they have a harder time when none of them are incentivized to even grow to 1%? Even if they do grow, there's plenty of incentive for stakers to move to new ones on the spot. This might mean that e.g. pools will increase their costs due to the risk and stakers will earn a bit less but they still won't grow beyond a point.

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