pull down to refresh
0 sats \ 0 replies \ @ugmug OP 22 Feb 2022 \ parent \ on: How Ethereum's PoS would be taken over by exchanges bitcoin
Awesome! This is exactly what I was hoping for when I wrote it. Let's break everything down:
Yes, users would absolutely attempt to withdraw their ETH, however, keep in mind in my scenario (and I do admit I'm making some broad assumptions) the exchanges themselves are the attackers. They can impose long withdrawal times on ETH, citing any number of reasons (technical difficulties, third party custodian, etc.) in order to keep funds on the exchange. I could even go tinfoil hat and say this is where nation states will step in and begin to ban withdrawals to noncustodial wallets. Remember, exchanges are slaves to the governments they operate within.
As for decentralized solutions like a DAO, I think a majority of ETH users will still place their funds on centralized exchanges. We only need to visit rekt to see how pooling funds in a contract is a gigantic risk of a loss of funds entirely. These DAOs can say that they're trustless and whatever other marketing scheme they want to pull off, but ultimately someone has to be running, monitoring, and maintaining the validators.
The main difference here is the validator set is pseudo-anonymous. Unlike mining pools, where you can actually see how much of a share of the hash power any pool has, you can't see how many validators an entity is running. So what will happen is the Ethereum community will have to make a retroactive change in response to an attack, instead of being able to proactively prevent it from happening in the first place. This is in-line with my previous post about PoW vs PoS because it's also proactive vs reactive security.
Correct that they can't forge signatures or rewrite history, though technically they could rewrite history, there's just an automatic penalty for doing so, which means they won't bother. However, my scenario outlines how they could change consensus rules, even if that does trigger a hard fork, as it won't matter since they have the majority of the user funds. Validators have one field where they can customize their identity, called the graffiti. Here you can see the graffiti field's use for every new block. You'll notice a good number of blocks have this field blank, some are advertisements, some have client info, etc.
I disagree here. We already know there are plenty of alternates to both Infura and Etherscan, yet they remain dominant due to network effects of everyone using them already, like Metamask, for example. Both Infura and Metamask are owned by Consensys, so it is unlikely that Metamask, which a majority of "Defi degens" use, will default to another provider. The real social aspect here is how the centralized exchanges can put the spin on their change to get the community to accept it. All they have to do is split the community and get some followers, then they can enforce their chain by excluding the minority fork.
I think we're way past the point of no return here. There are some clients which use less resources, but since they're not as popular or as well funded as Geth, there's no telling how their developers will maintain the software.
I think that about covers everything you brought up. Thanks for starting some discussion on this!