Vitalik Buterin voices concerns over DAOs approving ETH staking pool operators
The Ethereum co-founder proposes a solution that could lower the likelihood of any individual liquid staking provider growing to a point where it poses a systemic risk. Vitalik Buterin, the co-founder of Ethereum, has expressed worries regarding decentralized autonomous organizations (DAOs) exerting a monopoly over the selection of node operators in liquidity staking pools. In a September 30 blog post, Buterin issues a warning that as staking pools adopt the DAO approach for governance over node operators —who are ultimately responsible for the pool's funds—it can expose them to potential risks from malicious actors. “With the DAO approach, if a single such staking token dominates, that leads to a single, potentially attackable governance gadget controlling a very large portion of all Ethereum validators.” Buterin highlights the liquid staking provider Lido (LDO) as an example with a DAO that whitelists node operators . However, he emphasizes that relying on just one layer of pr...