Ethereum’s New Plan to Stop Insider Trading
Imagine a world where everyone has an equal chance to contribute to a network. This is what blockchain technology promises. But sometimes, a few people can control too much of the network, which isn’t fair. An Ethereum researcher, Malik672, has an idea to fix this problem. Let’s find out more!
The Centralization Problem
Ethereum, like other blockchains, can face centralization issues. This happens when a few entities control most of the network’s operations, like building blocks. In October 2024, two block builders, Beaverbuild and Titan Builder, handled nearly 89% of Ethereum blocks![3]
Even though this number has decreased to about 80% by February 2025, it’s still a big concern.[3]
Malik672’s Proposal
Malik672 has a plan to fix this. He suggests using a decentralized random block proposal system. This means block building would be spread out among thousands of clients worldwide. A special algorithm would decide who builds each block.[3]
The goal? To stop insider trading, which happens when people with special knowledge exploit the network for personal gain. By involving more people in block building, the network becomes fairer and more decentralized.[3]
How It Works
The system uses something called Byzantine Fault Tolerance (BFT) to keep the network running smoothly. Even if some nodes try to cheat, the network can still work.[3]
Validators, or people who check if blocks are correct, use BFT to reach an agreement on the state of the blockchain. This way, the network stays trustworthy and fair.[3]
Potential Problems
While this plan has many benefits, it also has some potential issues. One is that it might slow down the network because of the extra work involved.[3]
Another problem is Sybil attacks. This is when a bad actor creates many fake clients to gain more power.[3]
Lastly, having many block builders might make decision-making more complicated and lead to more disputes.[3]
A Step Towards Fairness
Malik672’s algorithm is a big step towards making Ethereum truly decentralized. It helps stop insider trading and keeps the network fair and transparent.[3]
But it’s important to test and improve this system carefully to avoid its potential problems. As blockchain technology keeps growing, ideas like these will help keep networks secure, fair, and decentralized.
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Sources:
– zycrypto.com
– theoverspill.blog