Blockchain
Centralization: the hideous enemy of freedom and progress within the realm of distributed ledger expertise. It typically rears its head as quickly as builders encounter scaling challenges.
In decentralized protocols, the quickest technique to transfer from level A to level B typically paradoxically entails resorting to some type of centralized mechanism. Neglect beliefs like censorship-resistance and independence, devs may cry out, we simply need this factor to be fast and low cost!
The hunt for additional decentralization within the blockchain area continues, however for some components, Stephane Gosselin says, centralization won’t be such a nasty factor, in spite of everything.
The previous co-founder and chief architect of Flashbots and founding father of Frontier Analysis spoke to Blockworks on the Bell Curve podcast about layer-2 rollups and the way centralized sequencers won’t be the issue that many worry.
All rollup sequencers are centralized
Let’s get one reality out of the way in which to start with: All layer-2 rollups on Ethereum — each single certainly one of them — use centralized sequencers.
The sequencer’s job is to course of and order transactions into blocks to be added to the chain. It’s cheaper, quicker and simpler for rollup suppliers to keep up their very own proprietary centralized sequencer system than to farm out the job.
“I’m nonetheless not satisfied that that’s a nasty factor,” says Gosselin, “I don’t assume it’s a achieved deal to say that, truly, first in, first out sequencers on a layer-2 are a nasty factor.”
The standard argument in opposition to rollup centralization, Gosselin says, is that it creates a “latency recreation” that pulls centralization towards a particular geographic area. Being concentrated in a specific place leaves a rollup prone to censorship and oppressive regulation wherever the rollup is deployed, Gosselin says.
“However, nonetheless, the query is like, is that really dangerous?”
Ethereum has been designed, Gosselin says, as a maximally decentralized layer-1 with comparatively little financial exercise on the bottom layer. Its aim is to settle information with out what he describes as “rivalry” — demand for selecting a particular place — which takes place inside layer-2s as a substitute.
“If in case you have an structure the place the layer-1 is simply settling information blobs and there isn’t rivalry, and you’ve got all of the exercise within layer-2s, it reduces the centralization stress on the layer-1 considerably.”
Cross-chain messaging to the rescue
Cross-chain messaging may save the day, Gosselin says, offering censorship-resistance between layers when wanted. “You will have some technique to push messages out from the layer-2 again into the layer-1, or possibly for it to be interpreted by another spin-up of that layer-2 elsewhere.”
By a messaging mechanic like IBC, Gosselin says layer-2s would stay censorship-resistant and non-custodial as a result of particular person rollup contributors can “exit their state and bridge it over to another roll-up in another jurisdiction.”
Host Mike Ippolito factors out that in such a scenario, customers would expertise vital “market disruption.”
“There could be a time frame the place we’d should migrate the property and every thing down into the primary chain and again up onto one other rollup.”
The looming risk of disruption, Ippolito says, may “stop TVL and exercise from migrating as much as the rollups as a lot as they in any other case would.”
Gosselin concurs, noting, “the opposite argument is, properly, if in case you have a way for the state to have the ability to exit again to the layer-1,” he says, “then you could have a whole lot of rivalry on the layer-1.”
“And so you could have all the identical centralization stress on the layer-1,” he says.
“I don’t assume, by any means, it’s completely solved.”
“On the finish of the day, sure, you’re going to have trade-offs in these totally different execution environments,” Gosselin admits, however in the end, app builders simply need an interface for connecting and robotically deploying their companies.
“These shared sequencers or decentralized block builders, cross-chain bridges, are all in the identical recreation of making an attempt to construct and supply these companies,” he says.
“There’s so many various methods to construct these items — and it’s not clear to me the place it’s going to go.”
