Over 60% Of Ethereum Nodes Are Running On Cloud Servers; Including 25% On Amazon Web Services
When the word cryptocurrency is thrown around, especially bitcoin, it brings an image of decentralized financial services that stand apart from the general chaos of politics. A safe haven to put your finances in because no one truly controls cryptocurrency.
This illusion was possibly shattered when Chainstack released a report detailing the extent cloud services are used for Ethereum’s data nodes.
Using a cloud service to spin up a node, especially on AWS, is much easier than buying all the equipment yourself. It’s not really a surprise that so much of Ethereum runs on cloud services, but it is concerning. To imagine that so much of Ethereum is kept in the hands of a single entity.
If Amazon felt the need too, they could make a quarter of Ethereum’s nodes disappear overnight, severely damaging the cryptocurrency’s ability to process transactions and, doubtlessly, affecting Ethereum’s value.
The chances of this happening in today’s political climate are rather slim, due to such an act would be terrible to Amazon’s reputation and in turn it's sales, but it is a concerning thing to be aware of as you go along, doing business with Ethereum.
The Usual Suspects
Of the staggering 8 399 Nodes that Chainstack detected when they did the investigation, 3,434 (Or 38.4%) of those nodes were run independently. Various cloud services managed the rest. Amazon owns 2195 of those nodes, the closest competitor, Alibaba Cloud, owning just 489 nodes.
57.3% of all nodes are owned by the big ten cloud service providers: Amazon, Alibaba, Google Cloud, DigitalOcean, Hetzner, OVH, Microsoft Azure, Cantabo, Choopa, and Linode.
Sobering information to take in, isn’t it?
A Trend Well Established
This is one of the first studies within the cryptocurrency market to highlight an issue such as this, but Ethereum is, without a doubt, not the only one going through this event. Tron, another cryptocurrency, has already stated it uses cloud services from Chinese giant Baidu. Komodo has tools specifically to create tools on AWS.
This information was successfully derived from Ethereum’s discovery protocol. A protocol that enables all Ethereum Nodes to communicate with each other and maintain a list of nodes that has been used within the span of 24 hours.
Using this, Chainstack made use of ethernodes.org, another blockchain explorer that in turn runs independent nodes made Chainstack capable of accessing the IPs and, in turn, to their respective ASNs, or Autonomous System Number.
From there, it’s just a matter of finding a free lookup tool to find the ASNs registered to the various IPs, and then further crossreferencing those ASNs with the cloud service providers.
While this may be the first investigation of its kind, it will doubtlessly be the last. Who knows what results we’ll find if we do this to other Nodes, Bitcoin included.