CoinDesk Report:
Author: nixo, Translation: Blockchain Jargon
We conducted a survey of independent operators (commonly referred to as “independent stakers”) to understand their demographics, challenges, and motivations for providing better insights.
Despite concerns about structural deprivation and centralization of validators, respondents exhibited high confidence and resilience in staking.
The data aims to offer perspectives from these privacy-oriented participants in their own words, accurately representing their needs. This survey is intended to be conducted annually, with feedback on the question set welcomed.
1. Methodology
1) Collection and Distribution
Survey results were collected using LimeSurvey software. Branching logic was employed to maintain relevance with respondents. Cookies prevented duplicate entries, and captchas deterred bot activity. The survey was public and anonymous.
Responses were solicited through EthStaker’s social channels (Reddit, Discord, Twitter, Farcaster), Obol’s Twitter account, major staking service providers, hardware vendors, and public channels of client software. Additionally, the survey was published on Beaconcha.in, Rhino Review, and Week in Ethereum newsletters. Responses were gathered from April 8, 2024, to May 6, 2024.
2) Sampling Bias
Preference for household staking over more remote methods was evident in the data, possibly due to participant identity and reach of the survey. Active participants in the staking community often manage their configurations, while those who do not may ignore surveys requiring immediate attention to maintain their validator nodes.
These qualitative insights are more reliable than quantitative ones, relying on subjective data from a self-selected group of stakers.
3) Scope of the Data
Publicly available node crawlers estimate Ethereum nodes between 6,000 to 11,000, managed by professional operators. This survey focused exclusively on stakers using their own capital, unrelated to professional operators. As of the draft, the estimated number of validators using Rocket Pool is 1832, derived from ETH-holding nodes minus Allnodes. This roughly serves as a lower limit for independent operators. Of the 1024 total responses, 868 came from stakers claiming control over their node configurations. Response rates from node operators range hypothetically from 8% to 47%, albeit with lower probability, encompassing all node operators, including professionals. The survey primarily targeted non-professional operators.
While validator numbers are easily visible online, exact counts of validators, individual operators, or even nodes on the network remain indeterminate (a feature rather than an error). Node operators may opt to self-identify their validators, though many independent and some professional operators may not.
2. Results
Raw data can be found here: https://github.com/eth-educators/staking-survey-data.
1) Profile of Respondents
– 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 between 66% to 100% of Ethereum.
– 30% use a smoothing pool, 61% do not, and 9% are unfamiliar or unsure of 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 (non-use of staking software typically implies following guides and using systemd).
– 85% have not changed their staking method since starting.
Figure 1: When did you first start running validators?
Figure 2: Where do you stake and do you hold Liquid Staked Tokens (LST)?
Figure 3: Have you changed your staking methods and how much ETH do you stake?
Figure 4: Are you involved in a smoothing pool?
Figure 5: What operating system do you use for staking?
Figure 6: Do you use staking auxiliary software?
2) Key Focus Areas
Key concerns include supermajority client risks, suboptimal tax structures for staking, hardware issues, and key management.
– 69% of respondents do not track their bandwidth usage; 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), the average time is 3.2 hours per month.
– On a scale of 1-10, where 10 represents the highest risk to the network, stakers rated supermajority risk at 7.4 and staking power centralization risk at 7.2 (adjustments were made for clarity).
– When asked to estimate the percentage of Ethereum staked in the next 2-3 years, respondents (n = 1003) averaged 49.4%.
– When asked to guess what percentage of staked Ethereum is operated by independent operators like themselves, respondents (n = 924) averaged 15.9%.
Figure 7: What are your biggest concerns?
Figure 8: How much bandwidth does your node use?
Figure 9: How many hours do you spend per month on maintenance?
Figure 10: What are the network’s risk factors?
3) Value Retention and Representation
Compared to when they started staking, 89% of respondents believe independent stakers are equally or more important to the network (11% see their value diminished).
– Compared to when they started staking, 66% of respondents believe independent stakers participating in consensus provide equal or greater benefits (34% see their value diminished).
– When asked how well they feel represented in ongoing research and protocol development, the average score was 5.8 (on a scale of 10, with 1 indicating “not represented at all”) (adjustments were made for clarity).
– 50% of respondents believe protocol research either ignores independent stakers or is powerless against vested interests (19% reported they do not care).
– 92% of respondents support or are neutral toward adjusting issuance curves to better incentivize decentralized forms of staking (excluding existing proposals).
Figure 11: What is the value of independent staking?
Figure 12: What does issuance and representation in research mean?
Figure 13: Advocacy for independent stakers
4) Continued Engagement
Primary motivations for initial staking were supporting the Ethereum protocol (84%) and earning returns (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% have no plans to exit.
Figure 14: Do you plan to increase your staking?
Figure 15: How long do you expect to continue running validators?
5) Sources of Learning for Stakers
– 69% of respondents cite technical guides (e.g., Someresat, CoinCashew, Rocket Pool docs, client docs) as their primary learning source.
– 63% cite EthStaker as their primary learning source.
– 53% cite ethereum.org as their primary learning source.
– Discord, blockchain browser notifications, Twitter, Reddit, ethresear.ch, and podcasts are frequently reported sources for following updates and protocol research, with notable mentions of The Daily Gwei.
Figure 16: What sources do you use to learn about staking?
Figure 17: What sources do you use to follow protocol research?
6) Open Questions: Unresolved Concerns
At the survey’s conclusion, respondents had the opportunity to comment on any issues not adequately covered. 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, making independent node operation less attractive and feasible, with re-staking seen as a potential centralizing factor.
User Experience, Technical Barriers, and Hardware:
There’s a call for simplifying the staking process to make it more accessible to non-technical users. Bandwidth issues, demand for IPv6 support, and asset management solutions were also mentioned.
Issuance Curve Adjustments:
Significant concerns were raised regarding the impact of changing issuance curves, especially for independent operators. Some support research in this direction, while many fear reduced returns favoring 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 favorable tax treatment.
MEV:
There are differing views on the use of MEV (Maximizing Extractable Value), with some ethical concerns leading to its non-activation. Respondents advocate for alternative solutions and further research to address MEV issues, which could potentially empower large centralized entities within the protocol.
Privacy Concerns:
Stakers are concerned about the disclosure of operational details such as IP addresses and transaction contents, compromising their privacy and security. Respondents seek the development and integration of privacy protection technologies, highlighting issues with audit systems that lack privacy and impact network neutrality and inclusivity.
Demographics:
95% self-reported as male.
90% perceive themselves to have some or strong technical capability.
74% are not employed in cryptocurrency.
88% stake from North America, Europe, or Australia.
Technical Background and Employment Industry
Your Region of Staking?
Independent operators predominantly consist of technically skilled males from North America, Europe, and Australia, using Linux operating systems. These results are unsurprising given the various reasons behind these imbalances, a target of diversity initiatives within the staking community.
However, details on operators’ staking percentages and the proportion of ETH used to run validators remain less known, as stakers tend not to share potentially security-compromising information.
Genesis Participation:
A significant portion of actively engaged Genesis stakers operate from home without holding large amounts of Liquid Staking Tokens (LST). These encouraging findings suggest a high confidence and resilience among independent operators in staking.
Independent Operator Proportion:
StakeCat’s recent report examined addresses confirmed as independent operators since the merge, indicating an increasing proportion of independent operators on the network since the merge event.
Independent Operators’ “Stickiness”:
Over the years, independent operators have been characterized as “irrational actors” and “altruists,” with their staked shares perceived to exhibit stronger “stickiness” compared to those injected by delegated stakers. While specific comparisons weren’t directly possible from this survey, respondents expressed a willingness to continue staking regardless of minor fluctuations in annualized returns or changes in the staking ecosystem.
Future Outlook:
StakeCat’s recent report indicates strong ongoing demand for independent staking, with the ratio of independent operators to professional operators remaining relatively stable or even increasing over time. Proposals aimed at protecting meaningful participation of independent operators under current protocol designs facing centralization pressures should heavily consider insights derived directly from their motivations and concerns.
This survey and report aim to provide these data points for brainstorming and research purposes only, emphasizing the need for proposals that directly address the motivations and concerns of independent operators.
