Vitalik Buterin Reveals: Only Staking a Fraction of His ETH, Not All…But Why?

Vitalik Buterin, the co-founder of Ethereum, recently discussed why he chooses not to stake all of his Ether (ETH) due to the complexity of multisignature wallets.

During an episode of the Bankless podcast on June 29, Buterin revealed the primary reason for staking only a small fraction of his ETH.

He explained that when you stake your ETH, the keys required to access it need to be made public on an online subsystem. To ensure security, a multisignature (Multisig) setup is necessary. However, setting up Multisig for staking purposes can be challenging and involves various complications.

This revelation prompted a response from Charles Hoskinson, the co-founder of Ethereum and founder of Cardano, who expressed his surprise on Twitter on June 30.

Hoskinson mentioned that he is “at a loss for words” upon learning that Buterin stakes only a small portion of his Ether. In contrast, Hoskinson claimed that he personally stakes “all” of his Cardano (ADA) holdings.

During the discussion, Buterin also talked about the EigenLayer protocol, which enables validators and stakers on Ethereum to transfer their assets to emerging networks.

Although the protocol is currently in its testnet phase and is expected to launch in the third quarter of 2023, Buterin highlighted the challenge of potential centralization risks.

He explained that the system would place higher value on trustworthy stakers compared to untrustworthy ones, as the former would have a lower likelihood of facing penalties.

Sreeram Kaanan, the founder of EigenLayer, acknowledged the complex risks associated with restaking and emphasized the importance of a constrained approach in its development.

This approach aims to ensure that any new innovations unlocked by the concept align with the ecosystem’s best interests.

In a blog post on June 9, Buterin also discussed the limitations of the Ethereum blockchain without adequate scaling infrastructure to achieve cost-effective transactions.

He pointed out that the adoption of smart contract wallets has introduced challenges related to user experience, particularly when users manage multiple addresses simultaneously.

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Unlock News Desk, is a group of Blockchain and Crypto enthusiastic young people, working to keep Unlock readers up to date with the industry news. Connect with the team via email: info(@)unlock-bc.com

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