Vitalik Buterin Addresses Concerns Over L2s and Fund Security in Ethereum
Ethereum’s Buterin has addressed concerns regarding the potential for Layer-2 solutions to compromise user funds. The debate was sparked by Mert Mumtaz, the co-founder & CEO at Helius, who suggested on social media that major Layer-2 platforms could theoretically engage in fund theft.
However, Vitalik Buterin, the founder of Ethereum, has clarified that the likelihood of such theft is minimal due to the necessity of an exceptionally high level of consensus among participants. He explained that a security council oversees the chain in case of governance issues, requiring a 75% vote threshold for decision-making.
To ensure decentralization and prevent collusion, at least 26% of the council members should have no affiliation with the company behind a specific Layer-2 solution. For example, in the case of Arbitrum, a group that can block quorum is composed of individuals external to Offchain Labs, the company responsible for the Layer-2 solution.
Buterin highlighted that both Arbitrum and Optimism adhere to these requirements, making the notion of fund theft by Layer-2 solutions seem implausible. Despite this, some remain skeptical about the independence of the quorum-blocking subset from the company. In response, Buterin pointed to the current composition of Arbitrum’s security council.
Cryptocurrency analyst Adam Cochran emphasized the importance of considering the collective impact of a council, the trust associated with its members, and their motivations. Cochran stressed the significance of having a diverse council with stakeholders holding public reputations, making it less likely for funds to be compromised.
In conclusion, the stringent governance structures in place for Layer-2 solutions like Arbitrum and Optimism, coupled with the diverse composition of their security councils, significantly reduce the risk of user fund theft. The commitment to transparency and decentralization within these platforms serves as a safeguard against malicious activities.
