Cryptocurrency
Achieving Equilibrium Between Blockchain Security and Decentralization (Op-Ed)
![](https://letizo.com/wp-content/uploads/2024/02/achieving-equilibrium-between-blockchain-security-anddecentralization-op-ed_65df27a59207e.jpeg)
By Trevor Traina, Founder and CEO of Kresus
You are reading these words because our planet is orbiting the sun at just the right distance to neither fry nor freeze us. Our planet is perfectly balanced for life to thrive. And within that world, numerous other forces exist in a state of optimal balance: light and dark, tropical and polar, terrestrial and aquatic.
So it is when it comes to designing blockchain systems. Their most powerful forces must be balanced in such a way that one cannot usurp another. Security should be as high as possible, but this must be balanced with the need to maintain sufficient decentralization. Network fees should be low but not so low as to induce spam attacks.
Finding that Goldilocks zone, the place where conditions are just right, is as much an ideological challenge as it is a technological one. After all, blockchain systems are ultimately designed and used by people who are only as strong as their weakest link. Web3 systems must walk the line between being optimized for security and for decentralization. It’s a delicate balancing act that goes to the very heart of what makes blockchain valuable.
Too Much Decentralization Can Kill You
There’s such a thing as too much freedom, which is why societies have laws and moral codes to regulate the worst excesses of human behavior. When it comes to Web3, it’s similarly possible to have too much freedom (i.e., decentralization) in the form of systems that have no recourse for worst-case scenarios:
- A team member loses their multisig key
- A user loses access to their wallet
- Tokens are sent to the wrong address
- A coding error leaves funds locked into a smart contract
- Assets are stolen using an exploit
All of these are “bad things” by Web3 standards, yet they occur every single day. As new users enter the space, the number of victims of phishing attacks, front-end injection, wallet poisoning, and other exploits will continue to rise. Attackers are getting more sophisticated, while each wave of Web3 users remains as vulnerable as the last.
Only recently, scammers used wallet drainers on Google and X ads to steal digital assets worth close to $60 million. Back in July, meanwhile, it was reported that four separate wallet drainers had stolen close to $65M since the start of 2023.
Give a society too much freedom, and a few of its members will rob, assault, and injure, driving at high speeds and engaging in other risky behaviors. Give Web3 users too much decentralization, and a portion will hack, be hacked, lose access to their wallets, and generally screw up.
Real-world freedom is dampened through security: police forces and CCTV. And blockchain freedom (decentralization) is also mitigated through security, which must be set at the right level to protect users from the most common mistakes while retaining the features that make blockchain so powerful:
- Strong transaction finality
- Lack of centralized control
- Support for financial self-sovereignty
Some crypto users want full control over their assets while also maintaining an undo button if they screw up. Others shudder at the thought of non-custodial wallets being “weakened” through provisions such as social login, seedless design, and key shares held by the developer.
Too Much Centralization Can Kill You
Do you know that saying about pleasing some people some of the time but not all of the people all of the time? That. When it comes to securing decentralized systems, it’s hard to create a single product that satisfies every user type. Put in too many safeguards, and hardcore users will abandon you; force new users to record a lose-it-at-your-peril seed phrase, and sooner or later, they’ll come unstuck.
Add too many centralized levers into a supposedly decentralized protocol, and you risk weakening the very foundations that gave it strength. Consider an ERC20 token contract that is upgradable by its creator. On the one hand, this allows the token’s parameters to be updated to reflect a shift in direction. On the other hand, it allows unscrupulous token creators to rug their operators.
As a result of this dichotomy, DeFi developers must strike a delicate balance between providing users with autonomy over their digital assets and making sure they aren’t taken advantage of by scammers seeking their next mark. Crypto wallets need to be more secure, but developers fear overstepping the boundaries of the decentralized wallet they’ve created.
Go for the Low Hanging Fruit
So what’s the solution? Well, for one thing, developers need to implement security features that can solve real threats – not theoretical ones. Less “military-grade encryption,” in other words, and more practical measures to warn users when they’re connecting to a spoofing site or about to send funds to a known phisher.
A lot of this comes down to better UX and more common sense on behalf of developers. For instance, it would be easy to filter all address poisoning attacks in which a user receives a dust transaction from a “lookalike” wallet they’ve recently interacted with. So why’s no one doing it?
Let’s focus on thwarting the most common hacks and scams before we move on to tackling threats from quantum computing and theoretical MiTM attacks. Hackers don’t go for the toughest possible exploit conceivable; they go for the low-hanging fruit, chalking up easy wins where possible. DeFi developers need to follow suit, focusing on fixing the most common ways in which users get rekt.
Security and autonomy don’t have to operate in conflict with one another: with a little thought, it’s possible to have the best of both worlds, combining the power of non-custodial ownership with a web2-level UI that demystifies everything from transaction signing to wallet backup.
Our planet may be perfectly balanced for life to thrive, but the on-chain environment still has some way to go. Still, it took the earth millions of years to create a climate that was hospitable for intelligent life. At just 15 years of age, blockchain has time on its side.
Author bio
Trevor Traina is the Founder and CEO of Kresus, the go-to Web3 SuperApp that combines a crypto wallet and an NFT platform. He is an investor and seasoned entrepreneur who co-founded five companies that were acquired by the likes of Microsoft, MasterCard, and Intuit and served on multiple non-profit boards such as the Fine Arts Museum of San Francisco and the Venetian Heritage, among others. Trevor served as the U.S. Ambassador to Austria from 2018 to 2021.
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Cryptocurrency
Top 10 Solana (SOL) Ecosystem Projects by Development Activity
![](https://letizo.com/wp-content/uploads/2024/09/top-10-solana-sol-ecosystem-projects-by-developmentactivity_66dc47b18afea.jpeg)
TL;DR
- Due to recent growth, Solana and its projects have gained popularity.
- Ecosystem meme coins like Dogewifhat (WIF) and Bonk Inu (BONK) have seen significant declines after a substantial surge earlier this year.
The Unsurprising Leader
Solana and numerous projects built on it have brimming in popularity in 2024. Some factors that could have contributed to this might be SOL’s bull run at the end of 2023 and the beginning of 2024, the growing community, and innovations in the ecosystem.
The crypto analytics platform Santiment recently outlined the top 10 Solana-based projects in terms of development activity in the past 30 days.
Somewhat expected, the first spot belongs to Solana itself, which collected a score of 186.33. It is worth noting that the protocol’s native token – SOL – has been experiencing a downfall since the end of July, plunging by approximately 30% and currently trading at around $127 (per Coingecko’s data).
Wormhole holds the second position with a ratio of 90.5. It acts as a bridge connecting various blockchain networks, such as Solana, Ethereum, BNB Smart Chain, and others. It enables users to transfer digital assets and data across these blockchains without a centralized intermediary.
Pyth Network is third, with a score of 68. It operates as a decentralized oracle network where multiple providers contribute to a collective data feed.
JITO and Neon round up the top 5 list. The other Solana-based projects down the line include Drift, Orca, Helium IOT, Helium Mobile, and Metaplex.
The Missing Ones
It is interesting to note that meme coins, which are part of Solana’s ecosystem, did not make the list. Such tokens, including dogwifhat (WIF), Bonk Inu (BONK), and many more, were among the top-trending topics in the crypto space at the start of the year due to their skyrocketing prices.
However, their progress has stalled as of late. WIF – the biggest Solana-based meme coin in terms of market capitalization – currently trades at around $1.52, representing more than a 70% decline from the ATH registered in April.
BONK (the second-largest) is worth approximately $0.00001666 as of the moment, or 60% less than the peak in May.
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Cryptocurrency
These Altcoins Bleed Out as Bitcoin (BTC) Price Fell by $4K in Hours (Weekend Watch)
![](https://letizo.com/wp-content/uploads/2024/09/these-altcoins-bleed-out-as-bitcoin-btc-price-fell-by-4kin-hours-weekend-watch_66dc47b73b311.jpeg)
Bitcoin’s nosedives continued in the past 24 hours as the asset slumped from an intraday high of $57,000 to under $53,000 within hours.
The altcoins are also in the red, and the total crypto market cap has dumped to $2 trillion for the first time in over a month.
BTC’s Troubles Keep Coming
The primary cryptocurrency lost the coveted $60,000 level last week, and the true downfall followed suit. Aside from a brief attempt to overcome that line on September 3, the bears have been predominantly in control, which culminated yesterday.
Before that, it was rejected a couple of times and marked lower daily highs. A relief rally came on Friday when the US released the job report for August, which showed that there was a slight decline in the unemployment rates.
BTC reacted quickly with a price increase from $55,500 to $57,000. However, that turned out to be a false breakout, and the cryptocurrency headed south immediately after. In a matter of minutes, it plummeted to $54,000 before the bears initiated another leg down that pushed it to a monthly low of $52,700 (on Bitstamp).
Despite recovering to just over $54,000 now, it is still 4% down on the day and more than 8% in the past seven days. Its market cap has plunged to $1.070 trillion, while its dominance over the alts is down to 53.5%.
Alts in Red Yet Again
The bearish scenario repeated once again, and the altcoins are back in red. Ethereum is among the leaders in this adverse trend, having lost over 4% of value. As a result, it now struggles at $2,250. BNB is down by 3%, XRP by 3%, and SOL by 2.5%.
DOGE has dumped the most from the larger-cap alts. The OG meme coin has seen 5% of its value evaporate over the past day and is below $0.1.
Further losses come from the likes of TON, BCH, SHIB, LTC, OKB, XMR, and many others.
The total crypto market cap has declined by another $50 billion and is down to $2 trillion on CG.
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Cryptocurrency
Vitalik Buterin Pledges L2 Tokens to Support Public Goods in the Ethereum Ecosystem
![](https://letizo.com/wp-content/uploads/2024/09/vitalik-buterin-pledges-l2-tokens-to-support-public-goods-inthe-ethereum-ecosystem_66dc47bce1201.jpeg)
Ethereum co-founder Vitalik Buterin has pledged to donate all Layer 2 (L2) tokens he holds to support public goods within the Ethereum ecosystem or broader charitable causes.
This announcement comes a few days after accusations that he had sold millions in Ether (ETH) for personal gain.
Vitalik Buterin Denies Profit Motive
Buterin was quick to respond to the allegations, emphasizing that he has not sold any ETH for personal profit since 2018. Instead, he clarified that any proceeds from his ETH sales have been directed toward projects that contribute to the Ethereum ecosystem or other charitable initiatives.
In a September 5 update, he expanded on his stance, pledging to donate all L2 tokens he holds, including not-yet-liquid assets, to support similar causes.
He wrote, “All proceeds will be donated, again either to support public goods within the Ethereum ecosystem or broader charity (e.g., biomedical R&D). I also do not intend to invest into L2s or other token projects in the foreseeable future.”
He explained that his aim in funding projects is to support initiatives he believes are important, particularly in situations where other parts of the ecosystem may not fully recognize their value.
The Allegations
On August 30, an X user accused him of selling over $2 million worth of ETH shortly after posting a positive update about Ethereum’s future.
Later on, Lookonchain also revealed that Vitalik had transferred 800 ETH, worth around $2 million, to a multi-signature wallet. Shortly after, the wallet swapped 190 ETH for 477,000 USDC.
Further analysis from Lookonchain indicated that on August 9, he had moved an additional 3,000 ETH, valued at over $8 million, to the same multi-sig wallet.
These transfers fueled speculation that the Ethereum co-founder was liquidating his Ether holdings to realize profits.
Buterin had previously disclosed that his entire Ether holdings came from the Ethereum pre-mining period, which allocated 11.9 million ETH (about 10% of the total supply) to early contributors. As one of them, he received 700,000 ETH for his role in the network’s creation.
According to blockchain tracker Arkham Intelligence, his current holdings amount to approximately 240,000 ETH. This is a reduction of around 460,000 ETH from his initial stash.
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