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Sunday, May 22, 2022

Vitalik Buterin Is Not A Fan Of dYdX Cross-chain Decentralizing

The market’s numbers have been bearish for the second week back-to-back as well as experts like Vitalik Buterin backing the trend. However, there is no lack of bullish news when it comes to the fundamentals in the industry. Here is what has been happening in DeFi over the previous week.

Vitalik Buterin’s Outlook On DeFi Developments

One of Ethereum’s co-founders, Vitalik Buterin had candidly assessed the possible limitations with regards to security when it comes to implementing bridges across chains that are completely functional. His argument was that using the native chain to store assets provides better security against a 51% attack, compared to activities across chains.

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Vitalik Buterin said that holding assets that are native to Ethereum on Ethereum is always going to be safer than holding them on Solana or holding native assets to Solana on Ethereum. He then posted multiple examples that served as proof for his thesis. Vitalik Buterin further noted that should any malicious entity try launching a 51% attack on a chain, an innocent party’s transaction can be reverted or censored, instead of being blocked and lost.

Even in cases that are most extreme, the funds of the users will be safe even if almost the entire protocol gets compromised. This is because, in such a case, there will be overwhelming support from the nodes for the remaining unaffected blocks that still follow the rules. These blocks will thus take over the process of making decisions.

Compared to this, if such an incident occurs in a bridge across chains, the losses would be irreversible according to Vitalik Buterin. The problem increases the more chains are added to one bridge. For example, if there is a 50-chain bridge, and a 51% attack takes place on one of them. This will make all 50 of them vulnerable.  

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