Vitalik Buterin Proposes Lower Staking and Faster Finality

Ethereum co-founder Vitalik Buterin is proposing significant changes to Ethereum’s proof-of-stake (PoS) consensus mechanism. Just two years after the network transitioned away from proof-of-work. In a Monday blog post, Buterin explored several potential improvements to Ethereum’s PoS model. Including lowering the financial barriers for solo stakers and reducing the time it takes to finalize transactions on the network.

Lower Staking Requirements

Currently, Ethereum validators must lock up 32 ETH—about $84,000—if they wish to participate in validating transactions and securing the network. However, Buterin believes this requirement is too high and suggests it could be lowered to just 1 ETH, approximately $2,600, to encourage more solo staking.

“Poll after poll repeatedly show that the main factor preventing more people from solo staking is the 32 ETH minimum,” Buterin wrote. “Reducing the minimum to 1 ETH would solve this issue, to the point where other concerns become the dominant factor limiting solo staking.”

Reducing the staking requirement would not only increase the number of participants but also address concerns about the network’s centralization. Lido Finance, the largest liquid staking platform, currently accounts for 28% of all staked Ethereum. Raising fears of too much control being concentrated in a few entities.

Faster Transaction Finality

Buterin also proposed speeding up Ethereum’s transaction finality times. Which currently take around 15 minutes. Finality refers to the point when a transaction is included in a block that cannot be altered.

Ethereum’s transaction finality is measured in epochs. Which occur every 6.4 minutes and consist of 32 slots that typically produce a new block every 12 seconds. Buterin suggested implementing “single-slot finality,” which would reduce the finalization time to 12 seconds. Making Ethereum transactions more secure and efficient.

“Single-slot finality would bring Ethereum’s properties in line with those of (more centralized) performance-focused [layer-1] chains,” Buterin wrote.

Balancing Efficiency with Security

Achieving single-slot finality would require a significant technical overhaul. Buterin acknowledged that several approaches could make this possible. Ranging from advanced cryptographic techniques to a two-tiered system for stakers. Each option presents its own set of challenges. But the goal is to improve both speed and security without compromising Ethereum’s decentralization.

Looking Ahead

Buterin’s proposals come amid ongoing discussions about the future of Ethereum, especially in light of the increasing adoption of layer-2 networks and the network’s upcoming Pectra upgrade. While Ethereum’s developers are working to improve staking rewards and transaction costs, the potential changes Buterin outlined could significantly alter how the network operates.

As Ethereum continues to evolve, these proposals offer a glimpse into the future of the network, balancing efficiency, accessibility, and decentralization as the ecosystem matures.