TL;DR
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Remember when we wrote about the ‘Shapella’ upgrade back in April? The Shanghai and Capella Ethereum network upgrades that allowed investors to withdraw their staked ETH for the first time?
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There is now a huge backlog of people wanting to stake their ETH for the first time; or redeploy their ETH to earn that sweet, sweet, ~5% guaranteed annual return.
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All of this has led some core Ethereum developers to propose increasing the validator limit from 32 ETH to 2,048 ETH.
Full story
Okay, ready to geek out?
Good.
So, remember when we wrote about the ‘Shapella’ upgrade back in April? The Shanghai and Capella Ethereum network upgrades that allowed investors to withdraw their staked ETH for the first time?
We didn’t know what was going to happen…
Would everyone immediately withdraw? Or would they stake their ETH until the value of their ETH rises to a point of profitability?
It turned out to be a combination of both.
More importantly, a few months later there is a huge backlog of people wanting to stake their ETH for the first time; or redeploy their ETH to earn that sweet, sweet, ~5% guaranteed annual return.
(Based, at least in part, on the relatively low interest rates currently offered by banks).
When we say “a huge backlog of people wanting to stake their ETH,” we mean thousands. No, tens of thousands. Actually, over ninety thousand.
Not only that, at the time of writing, it takes more than 44 days to activate a new Ethereum node.
What is the solution?
All of this has led some core Ethereum developers to propose increasing the validator limit from 32 ETH to 2,048 ETH.
(In other words, instead of requiring 32 ETH to be staked, they would require 2,048 ETH to be staked).
While a 6300% increase seems pretty dramatic, the numbers suggest that this is the best way to reduce the activation queue to manageable levels.
Unfortunately, increasing the validator limit by that much would make it prohibitively expensive for individuals to wager ETH.
It would also set a precedent for being able to change the validator limit based on supply and demand, which could spark further discussion in the future.
It’s just a proposal for now – and it’s great to see the core developers thinking about what the community wants.
Let’s see how this turns out.
