The Importance of Decentralization in the Bitcoin Network
The decentralization of the Bitcoin network is a topic that garners significant attention within the cryptocurrency community. It is widely believed that Bitcoin miners should establish operations in a variety of jurisdictions to mitigate the risk of regulatory capture. This perspective gained traction following China’s 2021 ban on cryptocurrency, which, despite its harsh implications, was viewed by some as a necessary catalyst for diversifying mining operations that had previously been concentrated in the Middle Kingdom. As a result, mining facilities have since proliferated across different continents, enhancing the network’s resilience.
In contrast, discussions surrounding the decentralization of Proof-of-Stake (PoS) networks like Ethereum and Solana are less prominent. However, the staking firm SenseiNode is striving to bolster the resilience of these blockchains by launching validator infrastructure throughout Latin America.
“When we initiated our operations, a staggering 99% of nodes were based in Europe, the United States, and parts of Asia,” remarked SenseiNode CEO Pablo Larguia in an interview with CoinDesk. “We proudly emerged as the pioneers in promoting geographic and jurisdictional decentralization in Latin America.”
Currently, SenseiNode manages approximately $800 million in assets staked through its platform, positioning it as the 15th largest staking firm globally. In contrast, the largest player in the field, Kiln, oversees more than $7 billion in staked assets.
SenseiNode operates across various Latin American nations, including Brazil, Argentina, Mexico, Chile, Costa Rica, and Colombia, while also maintaining nodes in the U.S. and Germany. A key feature of their operations is that they utilize local and regional data centers to host their nodes.
“Most nodes in the U.S. and Europe are hosted on platforms like Amazon Web Services, which ultimately represents a point of centralization,” Larguia noted. Despite the challenges, data centers in Latin America are often less advanced than their Western counterparts, compelling SenseiNode to adopt an educational role. They frequently assist in developing the necessary infrastructure to facilitate robust staking services.
The requirements for running nodes can vary significantly from one protocol to another, according to Larguia. For instance, some blockchain projects may impose higher storage demands based on the age of their blockchain history.
Cost structures for operating nodes also differ considerably. To run an Ethereum validator, one needs an investment of around $300 per month, while the cost for a Solana validator is approximately $800 per month. Interestingly, there are no restrictions on the number of tokens that can be delegated to a single Solana validator, unlike Ethereum validators, which are capped at 32 ETH each. Consequently, Ethereum staking tends to be more expensive for SenseiNode compared to Solana staking.
“For Polkadot and Avalanche, we currently operate about two or three nodes; however, for Ethereum, we manage around 9,000 nodes,” Larguia elaborated, highlighting the scale and commitment of SenseiNode to fostering decentralized staking solutions.
