CoinDesk Report:
Author: nixo, Translation: Blockchain Simplified
We conducted an investigation into independent operators, commonly referred to as “independent stakers,” to understand their profiles, demographics, challenges, and motivations for providing deeper insights.
Despite widespread concerns about structural deprivation and validator centralization among respondents, we observed high confidence and resilience in staking.
These data aim to provide perspectives in the words of these privacy-focused participants to accurately represent their needs. This survey is intended to be conducted annually and welcomes feedback on the question set.
1. Methodology
1) Collection and Distribution
Survey results were collected using LimeSurvey software. Branching logic was employed in questions to maintain relevance with respondents. Cookies prevented duplicate participation, and CAPTCHA was used to deter bot activity. The survey was public, ensuring respondent anonymity.
Responses were solicited through EthStaker’s social channels (Reddit, Discord, Twitter, Farcaster), Obol’s Twitter account, popular staking service providers, hardware vendors, and public channels of client software. Additionally, the survey was posted on Beaconcha.in, Rhino Review, and Week in Ethereum newsletter. Responses were collected from April 8, 2024, to May 6, 2024.
2) Analysis
Only complete survey data were used; incomplete surveys were discarded. Results underwent manual checks to ensure no complete survey data was discarded. Pie charts display results from single-choice questions, with asterisks (*) denoting answers from multiple-choice questions in discussions.
3) Scope of Data
Publicly available node crawlers estimate Ethereum nodes between 6,000 to 11,000, not all of which are validator nodes and many are managed by professional operators. This survey targets stakers using their own capital, excluding professional operators. As of the time of writing, an estimated 1,832 validators use Rocket Pool, derived from ETH-holding nodes minus Allnodes nodes, providing a rough lower bound on independent operator numbers. Of the 1,024 total responses, 868 were from stakers claiming control over their node setups. We estimate a response rate of stakers between 8% to 47%, albeit lower likelihood, reflecting all node operators, including professionals. This survey primarily focuses on non-professional operators.
Although validator counts are readily visible online, exact statistics on validator nodes, individual operators, or even network nodes (which can be seen as a feature rather than an error) remain unavailable. Node operators may choose to self-identify their validators, though many independent and professional operators may not.
2. Results
Raw data can be found here: https://github.com/eth-educators/staking-survey-data.
1) Respondent Profile
– 32% are genesis stakers.
– 80% stake from home, with an additional 4% staking both at home and remotely.
– 84% do not hold significant liquid staked tokens.
– 85% have not changed their primary staking method since starting.
– 77% stake 66% to 100% of Ethereum holdings.
– 30% use smoothing pools, 61% do not, and 9% are unfamiliar or unsure about relevant options.
– 95% use Linux to operate their validator(s)*.
– 51% do not use staking software to set up their validators. 27% use Rocket Pool, 15% use DAppNode, and 10% use Eth Docker (“not using staking software” typically means they followed guides and used systemd)*.
– 85% have not changed their staking methods since they began.
*Image*
Figure 1: When did you first start running validators?
*Image*
Figure 2: Where do you stake and do you hold Liquid Staked Tokens (LST)?
*Image*
Figure 3: Have you changed your staking method and how much ETH do you stake?
*Image*
Figure 4: Are you involved in a smoothing pool?
*Image*
Figure 5: What operating system do you use for staking?
*Image*
Figure 6: Do you use staking auxiliary software?
2) Primary Concerns
Major concerns include supermajority client risks, suboptimal tax structures for staking, hardware issues, and key management.
– 69% of respondents do not track their bandwidth usage, and 78% are unsure if it has increased since Dencun.
– Respondents spend an average of 3.4 hours per month (median 2 hours) maintaining their setups, excluding an outlier with a standard deviation of 22 (x = 155 hours), with an average of 3.2 hours per month.
– On a scale of 1-10, where 10 represents the highest potential risk to the network, stakers rated supermajority risk at 7.4 and staking power concentration risk at 7.2 (adjustments were made for clarity in scoring).
– When asked to estimate what percentage of Ethereum would be staked in the next 2-3 years, respondents (n = 1003) averaged 49.4%.
– When asked to estimate what percentage of staked Ethereum is operated by independent operators like themselves, respondents (n = 924) averaged 15.9%.
*Image*
Figure 7: What concerns you most?
*Image*
Figure 8: How much bandwidth does your node use?
*Image*
Figure 9: How many hours per month do you spend maintaining?
*Image*
Figure 10: What are the network’s risk factors?
3) Value Retention and Representation
– Compared to when they began staking, 89% of respondents believe independent stakers’ importance to the network has increased or remained equal (11% believe it has decreased).
– Compared to when they began staking, 66% of respondents believe independent stakers’ participation in the consensus process provides equal or greater benefits (34% believe they receive less value).
– When asked how well they feel represented in ongoing research and protocol development, the average score was 5.8 (on a scale of 10, where 10 represents “very well represented” and 1 represents “not represented at all”) (adjustments were made for clarity in scoring).
– 50% of respondents believe protocol research either neglects independent stakers or lacks influence when faced with powerful interest groups.
– 92% of respondents support or are neutral regarding changes to issuance curves to better incentivize decentralized forms of staking (excluding current proposals).
*Image*
Figure 11: What is the value of independent staking?
*Image*
Figure 12: What does issuance and representation in research mean?
*Image*
Figure 13: Advocacy for independent stakers
4) Continued Engagement
– The primary motivation for initially staking was to support the Ethereum protocol (84%), followed by earning rewards (81%).
– 65% plan to continue increasing their staking.
– 35% plan to continue increasing their staking but intend to stop upon meeting certain external conditions.
– 31% do not plan to increase their staking.
– 62% state they have no plans to exit.
*Image*
Figure 14: Do you plan to increase your staking?
*Image*
Figure 15: How long do you expect to continue running validators?
5) Sources for Learning
– 69% of respondents cite technical guides (e.g., Someresat, CoinCashew, Rocket Pool documentation, client docs) as their primary learning source.
– 63% cite EthStaker as their primary learning source.
– 53% cite ethereum.org as their primary learning source.
– For following necessary updates and protocol research, commonly reported sources include Discord, blockchain explorer notifications, Twitter, Reddit, ethresear.ch, and podcasts, with a significant mention of The Daily Gwei.
*Image*
Figure 16: Which sources do you use to learn about staking?
*Image*
Figure 17: Which sources do you use to follow protocol research?
6) Open Questions: Unresolved Concerns
At the end of the survey, stakers had the opportunity to comment on any issues not adequately covered in the survey. Complete responses can be found in the raw data, available [here](https://github.com/eth-educators/staking-survey-data).Decentralization and Centralization Risks:
Many respondents expressed concerns about the centralizing effects of current protocol developments and the inadequate representation of independent validators. Liquid Staking Tokens (LST) are seen as a centralizing force that diminishes the attractiveness and feasibility of independent node operation, while re-staking is viewed as a potential centralizing factor.
User Experience, Technical Barriers, and Hardware:
There is a strong call for simplifying the staking process to make it more accessible to non-technical users. Issues such as bandwidth limitations, the need for IPv6 support, and solutions for asset management were also highlighted.
Issuance Curve Adjustments:
There are significant concerns about the impact of changing issuance curves, particularly affecting independent operators. Some support research in this direction, while others believe reduced returns could favor only large centralized staking entities.
Economic and Tax Implications:
Tax policies pose a significant burden for independent validators. The economic feasibility of independent staking is lower compared to holding Liquid Staking Tokens (LST), which enjoy more favorable tax treatments.
MEV:
Opinions on the use of Maximum Extractable Value (MEV) vary. Some choose not to enable it due to ethical concerns. Respondents advocate for alternative solutions and further research to address MEV’s potential to benefit large centralized entities, potentially compromising Ethereum’s decentralized nature.
Privacy Concerns:
Validators are concerned about the disclosure of operational details such as IP addresses and transaction contents, impacting their privacy and security. Respondents seek the development and integration of privacy protection technologies to address these issues, which also touch upon the scrutiny faced by the review system, affecting network neutrality and inclusivity.
Demographics:
95% self-identify as male, 90% consider themselves to have moderate to strong technical abilities, and 74% are not employed in cryptocurrency. 88% of respondents staking come from North America, Europe, or Australia.
Figure 18: Technical Background and Employment Industry
Figure 19: Where do you stake from?
Independent operators predominantly comprise technically proficient males from North America, Europe, and Australia, using Linux operating systems. These results, while unsurprising, underscore various reasons for the imbalance and are targets for diversity initiatives within the staking community.
Staking Details:
Among actively engaged Genesis stakers, 80% operate from home, 84% do not hold significant amounts of Liquid Staking Tokens, and 77% stake more ETH than their total holdings, indicating high confidence and resilience among independent operators.
Independent Operator Ratio:
A recent StakeCat report studied addresses confirmed as independent operators (methodology outlined), noting an increase in their proportion since the merge event.
Future Outlook:
StakeCat’s recent report indicates strong ongoing demand for independent staking. Efforts are focused on protecting meaningful participation of independent operators under current protocol designs facing centralization pressures.
These proposals should heavily rely on insights directly obtained from the motivations and concerns of independent operators, with this survey and report providing data for brainstorming and research purposes only.
Figure 20: Increase in ETH staked over time post-Shapella hard fork
These dynamics highlight the challenges faced by independent operators compared to professional staking entities, stressing the need for fairer reward structures to address perceived disenfranchisement among stakeholders.
Independent Operator “Stickiness”:
Over the years, independent operators have been characterized as “irrational actors” and “altruists,” known for their higher stake retention compared to delegated stakers. The survey indicates a willingness among many to continue staking despite minor fluctuations in annualized returns or changes in the staking ecosystem.
Ultimately, while temporary incentives like airdrop activities in 2023 and 2024 acknowledge disparities between independent and professional operators, long-term structural fairness should not solely rely on them.
Looking Ahead:
StakeCat’s latest report underscores sustained demand for independent staking and aims to maintain or increase the ratio of independent to professional operators over time. Efforts are focused on protecting meaningful participation of independent operators amidst ongoing centralization pressures in current protocol designs.
These proposals should heavily rely on insights directly obtained from the motivations and concerns of independent operators, with this survey and report providing data for brainstorming and research purposes only.
