? Let's Learn Something New: Why 32 ETH?
The decision to set the Ethereum staking requirement at 32 ETH is rooted in a balance between network security, decentralization, and technical constraints. Here's a detailed explanation of why this specific amount was chosen:
?? Ethereum's Consensus Mechanism: Gasper
Ethereum employs a consensus mechanism known as Gasper, which combines two primary components:
?? LMD GHOST: A fork-choice rule that helps the protocol select the most viable chain tip that hasn't been finalized.
?? Casper FFG (Friendly Finality Gadget): A finality mechanism that allows the network to finalize blocks, making them irreversible. Casper FFG, in particular, plays a crucial role in Ethereum's ability to achieve consensus and secure the network. However, it introduces a challenge related to communication overhead, known as quadratic messaging complexity. This means the amount of communication between nodes increases quadratically with the number of participating nodes, as described by the formula (i.e. O(N^2), where N is the node count)
?? The 32 ETH Compromise
The quadratic messaging complexity necessitates a limit on the number of validators to ensure the network can function efficiently and remain decentralized. This limit is influenced by:
Messaging throughput per second (m): The capacity of the network to handle messages.
Time-to-finality (T): The time required to finalize a block. To balance the goals of wide participation, low hardware requirements, and swift finality, the Ethereum developers arrived at the 32 ETH stake requirement. This stake size is part of a compromise that also includes a time-to-finality of 768 seconds.
The choice of 32 ETH aims to:
? Limit the number of validators to a manageable level, given the messaging overhead.
? Ensure decentralization by allowing a reasonable number of participants to become validators without requiring excessive resources.
?Maintain network security by having a significant amount of value at stake.
?? Realistic Expectations and Future Adjustments
Considering the entire Ethereum supply, if every ETH were to be staked, it would result in a theoretical maximum of around 3.75 million participating nodes. However, realistic expectations set the staking participation to 20-25% of the total supply, significantly reducing the messaging throughput required and making the network accessible to individuals with modest internet connections. The 32 ETH requirement is not seen as a permanent fixture. It is anticipated that advancements in technology, improvements in internet and hardware capabilities, and innovations such as messaging compression and signature aggregation (e.g., BLS signature aggregation) could allow for a reduction in the required stake size. Future adjustments might lower the threshold to 16 ETH or even 8 ETH, enhancing accessibility and further decentralizing the network.
In summary, the choice of 32 ETH as the stake size for Ethereum validators is a strategic decision designed to balance technical limitations with the goals of decentralization and network security. As the Ethereum ecosystem evolves, it's likely that this requirement will be revisited and potentially adjusted to reflect advancements in technology and network capacity.