Vitalik Buterin Proposes Streamlined Proof-of-Stake for Ethereum; MicroStrategy’s Stock Surges 350% in 2023 Amid Bitcoin ETF Hype; Worldcoin Expands Identity Verification Services in Singapore Post India Pause
Ethereum Co-founder Advocates for a Simpler and Lighter Consensus Mechanism
Ethereum co-founder Vitalik Buterin has put forward a proposal to simplify and lighten the proof-of-stake (PoS) consensus mechanism on the Ethereum blockchain. In a move aimed at reducing the load on the network, Buterin suggests a method to decrease the number of signatures required from validators to maintain the Ethereum network.
As of now, Ethereum supports an extensive number of validators, approximately 895,000, to achieve decentralization and allow broader participation in staking. However, handling this many validators imposes significant technical challenges, requiring the network to process a substantial number of signatures per slot, around 28,000, which Buterin considers a burdensome load.
The proposal suggests a shift toward a more moderate solution, reducing the signatures per slot to around 8,192. This adjustment would lead to technical simplification, enhance quantum resistance, and maintain a substantial total slashable ETH at approximately 1-2 million ETH. Slashing is a mechanism designed to enforce positive validator behavior.
Buterin outlines three potential approaches to implement this change:
Reliance on decentralized staking pools, a two-tiered system with “heavy” and “light” staking, and rotating participation with accountable committees. These proposed solutions aim to make the digital signature load more manageable.
By setting a future signature load at a reasonable level, Buterin believes this adjustment will ease protocol and infrastructure development, providing developers with more predictability in scaling efforts. He concludes that future increases in signature load can be considered through hard forks, ensuring developers are confident in the technology’s ability to handle a larger number of signatures-per-slot with ease.
This proposal aligns with Buterin’s previous warnings about the potential risks of overextending Ethereum’s consensus beyond its core functions of block validation and network security.
MicroStrategy’s Stock Surges 350% in 2023 Amid Bitcoin ETF Hype
MicroStrategy (MSTR) has witnessed a remarkable surge of over 350% in its stock price in 2023, largely driven by anticipations surrounding the approval of a spot Bitcoin exchange-traded fund (ETF) in the United States. Currently trading at $654, reflecting an 8.3% intraday increase, the company’s significant exposure to Bitcoin is a key driver of its stock performance.
MicroStrategy, along with its subsidiaries, holds a substantial amount of Bitcoin, totaling 189,150 BTC. This represents a combined purchase price of approximately $5.9 billion, with an average purchase price of $31,168 per BTC. Some analysts are characterizing MicroStrategy’s stock as essentially a leveraged Bitcoin ETF, given its extensive holdings of the cryptocurrency.
Company’s Bitcoin Exposure Fuels Impressive Performance
An analysis from Seeking Alpha, based on the company’s quarterly earnings, reveals that MicroStrategy has employed a combination of long-term, low-interest debt, and share issuance to finance its Bitcoin acquisitions. As of September 30, the company’s total liabilities amounted to $2.534 billion, marking a 7.7% year-over-year decline, with long-term liabilities totaling $2.180 billion.
MicroStrategy, known for providing business intelligence, mobile software, and cloud-based services, has seen its growing exposure to Bitcoin tie its balance sheet more closely to the volatility and risks of the cryptocurrency markets.
The enthusiasm surrounding the potential approval of spot Bitcoin ETFs on Wall Street is also contributing to the surge in MicroStrategy’s stock and the broader cryptocurrency market. Bitcoin’s price has outperformed major traditional assets, gaining over 160% in 2023 despite challenging macroeconomic conditions and industry headwinds. The U.S. Securities and Exchange Commission is expected to make a decision in early January on allowing Bitcoin spot trading through ETFs, with industry giants like Fidelity and BlackRock awaiting approval. Successful approval could have a positive impact on Bitcoin’s prices and market liquidity by opening the cryptocurrency to a broader investor audience.
Worldcoin Expands Identity Verification Services in Singapore Post India Pause
Worldcoin, the identity verification project, has officially launched its iris-scanning services for residents in Singapore. The project has expanded its presence after a temporary pause in India, focusing on providing its unique identity verification services at five locations in Singapore. While Worldcoin claims its services are steadily growing globally, this announcement comes following a temporary suspension of scans for residents in India.
Iris-Scanning Project Resumes Operations After Temporary Hold in India
As of the latest update, Worldcoin’s website indicates verification locations are available in 11 countries, including the United States. However, the project faced regulatory challenges, with authorities in certain jurisdictions, such as Kenya, suspending operations due to privacy concerns.
Worldcoin initiated its identity verification services in 2021, garnering over two million sign-ups before its official launch in July 2023. The project boasts that over five million people have created accounts using their verified identity, representing approximately 0.06% of the global population.
The creator of Worldcoin, Sam Altman, who is also the co-founder and CEO of OpenAI, faced a brief departure from his position at the artificial intelligence research firm in November. His dismissal led to protests from colleagues, resulting in Altman’s reinstatement after 12 days. Worldcoin’s recent expansion signals its ongoing efforts to establish a global footprint in the identity verification space.
