Home
News
- 1 The limit of 32 ETH as minimum and maximum fees is proposed to push over 2,000 ETH.
- 2 With the Merge upgrade on the network, it became the blockchain network staking supporting blockchain network.
Ethereum (ETH) network went through its highly anticipated Merge upgrade in September last year. The transition from proof-of-work (PoW) consensus mechanism to proof-of-stake (PoS) was among the biggest upgrades across the crypto and blockchain industry. Following the update, the Ethereum network validators were bound to stake an amount of 32 ETH. Now, the maximum validator balance is said to go up to 2,048 ETH.
Increasing Upper Cap to Help Ethereum Validators
In an Ethereum Core Developers Consensus Meeting which took place on Friday, June 16, the proposal was pushed forward. As per the proposal, core developers are considering to increase the maximum validator fees ceiling to 2,048 ETH maximum. At present, one needs to stake at least 32 ETH minimum and maximum, in order to become a validator over the smart contract blockchain network.
Researcher at Ethereum Foundation, who also happens to act as one among to propose the change over network, Michael Neuder, stated the current limitation of validator fees as an upper cap will result in inflation of the set of validators.
Pushing the validator staking amount ceiling will result in the expanding set of active validators. It will lead to improved efficiency of the network when the block finally would take in a single slot over the Ethereum network.
Though the lower threshold helps the network to remain decentralized given the maximum participation of validators, the large-scale validators face some difficulties. Currently, the large-scale operations need to employ multiple validators in order to raise maximum yields. Large-scale validators, willing to earn more yield by staking more ETH, can get a chance to scale up their earning by lining up their multiple validators to the minimum.
The certain and lower staking amount resulted in a significant number of validators over the network. Over 600,000 active validators are there on the network, while approx 90,000 more are in the queue waiting to take active participation in the validating transaction process.
Concerns Around Lifting the Staking Limit
Validator rewards are also expected to get better with the auto-compounding. Rewards more than the limit of 32 ETH used to redirect and generate staking yield. However, with the limit to raise to the bigger number, the cap to get raised, the said rewards could get compounded and validators will have an option to to earn more.
Larger validator node operators like Coinbase, have to carry out operations while keeping thousands of validators to hit their goal. The heightened ceiling would help in keeping the high stake validators in minimum number of them,
However, the plan is not perfect and fool-proof. It also has shortcomings. On the flip side of maximum profits, the penalties on mistakes like double attestation, during validation of transaction, would also rise. The discussion is still on the proposal yet to see the signals for further developments.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
