Two addresses control 46% of all Ethereum PoS nodes for transaction processing post-Merge
The cryptocurrency industry is still responding to Ethereum’s (ETH) shift to a Proof-of-Stake (PoS) system, which has several potential advantages, such as making ETH a deflationary asset. In this section, the on-chain activity of Ethereum holders is one of the primary indicators being tracked to estimate the effects of the update.
In fact, as of September 15, the Ethereum post-Merge inflation research revealed that 46.15 percent of the cryptocurrency’s Proof-of-Stake (PoS) nodes are owned by two addresses, according to statistics from blockchain analysis platform Santiment.
Following the update, the leading address has verified about 188 blocks, or 28.97%, while the second biggest address has validated 105 blocks or 16.18%. The two wallets often dominate Ethereum’s transaction processing, data storage, and addition of new blockchain blocks.
Nodes play a vital role in the introduction of the staking mechanism on Ethereum since they pledge “stakes” of tokens for a specified duration in return for the opportunity to create the next block of transactions.
Even if the Merge is in its infancy, the supremacy of the two addresses goes against Ethereum’s overall ideal of decentralization. With staking, Ethereum seeks to decentralize the blockchain’s control, which is difficult to do with the energy-intensive Proof-of-Work blockchain.
In the meanwhile, the Merge continues to generate excitement in the cryptocurrency market, with the development project acting as a catalyst for a price gain and attracting more institutional investors to the ecosystem. Nonetheless, the primary focus is on the first success of the Merge.
As reported by Finbold, the creator of the cryptocurrency lending site Nexo cautioned that there is no assurance the improvement would boost Ethereum. He mentioned the necessity to monitor early success.
Notably, the Merge is anticipated to transform Ethereum into an energy-efficient blockchain, a development that shifts pressure away from Bitcoin (BTC). According to Finbold, environmental advocacy groups are urging Bitcoin to enhance its environmental performance.
It is important to note that Bitcoin is still criticised for its carbon impact, even as governments work to mitigate climate change.
In addition, Vitalik Buterin, the co-founder of Ethereum, predicts that the Proof-of-Stake status would lower world power use by around 0.2%.