- The Amazon Web Services (AWS) alone hosts more than 50 percent of the total Ethereum nodes.
- Ankr and Pocket are node infrastructure protocols aiming to offer decentralized alternatives at reduced costs with near-zero downtime.
The Ethereum network is one of the most widely used blockchain platforms catering to a large number of services including smart contracts, decentralized finance (DeFi), decentralized apps (dApps), NFTs, and much more.
The Ethereum blockchain network currently has more than 4,653 active nodes. As per crypto analytics platform Messari, nearly two-thirds of all the Ethereum active nodes have been hosted on centralized servers. Of them, Amazon Web Services (AWS) has the lion’s share at more than 50 percent.
This could probably expose Ethereum to central points of failure. Messari says that a similar picture stands true for the Solana nodes. In its recent Twitter post, the crypto analytics platform noted:
Crypto needs to decentralize. Three major cloud providers are responsible for 69% of the 65% of @Ethereum nodes hosted in data centers. Of the estimated 95% of @Solana nodes hosted in data centers, 72% are hosted with the same cloud providers as @Ethereum.
After Amazon Web Services, cloud service provider Hetzner dominates in the second position hosting 15 percent of Ethereum nodes. OVH and Oracle Cloud come third at 4.1 percent each. Alibaba comes fourth at 3.9 percent while Google Cloud comes fifth at 3.5 percent.
Crypto needs to decentralize.
Three major cloud providers are responsible for 69% of the 65% of @Ethereum nodes hosted in data centers.
— Messari (@MessariCrypto) August 18, 2022>> Buy Ethereum (ETH) quickly and securely with PayPal, credit card or bank transfer at eToro. Visit Website <<
However, the scenario three years back in 2019 was pretty much the same. The only difference is that Amazon Web Services (AWS) has just increased its share of hosting Ethereum nodes by 2x. Back in December 2020, Messari pressed a similar issue. Messari said that the high-cost nature of Ethereum nodes can make the network vulnerable.
High costs to run infrastructure make it more likely that nodes would run infrastructure with cloud computing providers (i.e AWS) – making Ethereum more exposed to central points of failure.
A decentralized alternative to Node infrastructure
Messari said that it is essential to have decentralized alternatives to the centralized node infrastructure of the Ethereum blockchain network. This will pave the way for a permissionless Web 3 ecosystem. In its report, Messari notes:
Ankr and Pocket are node infrastructure protocols aiming to offer decentralized alternatives at reduced costs with near zero downtime.
Pocket Network grew from 4,300 to over 37,800 nodes in the last year, servicing over 1 billion daily relays, a 125x increase YoY. In contrast, Ankr only has 345 centrally operated nodes but relays 3.1 billion public RPCs every day.
But Messari adds that the off-chain relay distributor mechanism for Pocket and Ankr are centrally operated while creating a single point of failure.
The crypto analytics platform further adds that even though Ankr has 3x more Remote Procedure Calls (RPCs) it suffers similar centralization problems as other players. Interestingly, Ankr has no plans to resolve this matter. On the other hand, Pocket is working “to replace its centralized relay distributor with a decentralized on-chain mechanism in its upcoming V1 release”.
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