Buterin wants to facilitate more decentralization and promote solo staking by lowering Ethereum’s staking requirements.
Vitalik Buterin, a co-founder of Ethereum, has acknowledged the significance of reducing the minimum amount of Ether needed for cryptocurrency investors to generate passive income through solo staking.
Buterin participated in a community conversation on X on October 3 in favor of reducing the minimum Ether ETH $2,346.76 deposit needed for lone stakers.
Solo miners operate entire nodes on their private computers, independent of centralized organizations, staking pools, or other third-party services. However, locking up 32 ETH prevents more people from participating.
Buterin emphasized the value of lone stakers for bolstering Ethereum’s security and decentralization during the September Ethereum Singapore 2024 event.
The significance of lone investors in actual decentralization
Buterin asserts that even a tiny proportion of lone stakers can give ETH an indispensable decentralized layer of defense and assist in fending off 51% of attacks. At the time, he stated:
“The stronger that we can have solo […] I think there is a lot of ways in which that can serve as this really important extra layer of defense regarding security and privacy.”
During recent conversations with community members, Buterin presented strategies for fostering a more extensive network of individual stakeholder communities. His short-term fix was to raise the bandwidth requirement to 16 or 24 ETH in return for removing the requirement for a minimum staking investment.
However, an Ethereum developer noted that home networks’ bandwidth availability depends on their actual location, which may be counterproductive to the intended outcome.
lowering the minimum for solo staking to one Ethereum
However, Buterin said his workaround might enable scalable and inexpensive solo staking. He continued, saying:
“Then once we figure out peerdas, bandwidth reqs go back down, and once we figure out orbit single-slot finality (SSF), the deposit minimum can drop to 1 ETH.”
Reducing the Ethereum solo staking minimum limit to 1 ETH would encourage increased participation and increase the decentralization of ETH.
Recently, however, based only on technicality, Buterin decided to take action against ETH projects claiming to be layer-2 networks.
By the end of 2024, he claimed, all Ethereum layer 2s must be in “Stage 1.” If they don’t, the community should stop referring to them as layer 2s.