Lane Rettig on the Ethereum Proof-of-Stake Upgrade
Former Ethereum core developer Lane Rettig breaks down the claims made about the network’s proof-of-stake (PoS) upgrade and provides a critical analysis of its impact on energy consumption, security, and profitability.
Key Points:
- Claim #1: Proof-of-stake is less wasteful
- – Energy consumption reduction is misleading as GPUs used for mining still exist and consume energy
- – The number of validators has increased, resulting in more energy consumption
- – The market for maximal extractable value (MEV) has grown, requiring computational power
- – The total social cost of operating the network should be considered
- Claim #2: Proof-of-stake is more secure
- – PoS allows for a cartel to control the network silently, unlike PoW
- – PoS chains are easier to attack and weak subjectivity is a concern
- – Bitcoin’s “longest chain wins” rule is more neutral and trustless
- Claim #3: Proof-of-stake increases profitability
- – The block subsidy fell after the upgrade and deflationary periods occur
- – Network security cannot be circumvented without consequences
Hot Take:
Rettig’s analysis challenges the claims made about the Ethereum PoS upgrade, highlighting concerns about energy consumption, security vulnerabilities, and the sustainability of profitability. While the upgrade may have technical advantages, Rettig questions the economic justifications put forth by its proponents.
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