Ethereum
Solana vs. Ethereum feud intensifies with Validator Ouster
The Solana Foundation has expelled a number of validator operators from its influential delegation program. This action is attributed to their involvement in carrying out “sandwich attacks” against unsuspecting network users, a form of predatory trading that undermines the integrity of the network. The decision adds a new layer to the growing rivalry between Solana and Ethereum, highlighting broader concerns around network governance and the ethical dimensions of validator operations.
Tim Garcia, Validator Relations Manager, made the announcement via Discord, emphasizing the finality of the Foundation’s decision: “A group of Solana Foundation Delegation Program operators have been removed from the program due to violations. […] Decisions in this matter are final. Enforcement actions are ongoing as we detect operators participating in mempools that enable sandwich attacks.
Mert Mumtaz, founder and CEO of Helius Labs, provided a detailed description explanation issues at stake. He described a sandwich attack as a manipulative trading strategy in which malicious actors exploit the order of transactions to disadvantage retail investors, ensuring that they receive the worst possible prices.
“This is not natively possible on Solana because the client does not have a memory pool,” explained Mumtaz. “Some actors have added mods to their validators to enable sandwiching on Solana.” He stressed that the main objective of the SOL Foundation is to protect individual users against these attacks, emphasizing that although the ousted operators can still operate on the network, they will no longer benefit from the Foundation’s subsidies.
Solana counters. Rivalry with Ethereum intensifies
The incident drew heavy criticism from stalwarts of the Ethereum community, including Ryan Berckmans, an esteemed investor known as ryanb.eth. He criticized SOL’s approach to solving MEV issues, questioning the seriousness of the network as a settlement layer.
“The Solana Foundation provides financial support to many validators because it costs over $65,000/year to operate a Sol validator. Now the next step in their plan to solve MEV was to obtain financial support from validators who extract the MEV. Solana is not a serious implementation layer”, Berckmans affirmed.
Contrary to Berckmans’ criticism, Mumtaz highlighted the financial and operational disparities between Solana and Ethereum validators. “You haven’t done the work to have an informed opinion,” Mumtaz retorted, pointing out that while Solana validators have lower setup costs than Ethereum’s 32 ETH. minimum bet requirement.
“Maybe you forget that with the minimum of 32 ETH, it costs around 120,000 Eth, which is twice as much as Solana – *and* while the SOL validator’s revenue has exceeded Eth several times over the last month. it doesn’t take away “support from validators who do mev,” he said and clarified that the SOL Foundation “simply does not distribute grants to malicious validators who sandwich, who steal retail and then keep all rewards with 0 network/in protocol distribution – this is purely extractive.
Continuing the dialogue, Lucas Bruder, CEO of Jito Labs, defended the position of the Foundation, with an emphasis on the alignment of interests between the Foundation and the wider network. “The Solana foundation is a shareholder in the network. Stakeholders should want to see the network succeed. Why would they support something that diminishes the network’s chances of success? » he applied.
However, Bruder also acknowledged the predominant nature of memecoin trading and the potential risks of alienating this user base. “Most activity on Solana is memecoin tradingso if you screw up the core user base of blockspace, they will leave and we will all be sitting here with less usage wondering why we didn’t do anything,” he argued, emphasizing the need to a long-term approach. solutions to network challenges.
Ryan Berckmans doubled down on his criticism, saying: “So if the Solana Foundation doesn’t use its centralized power to incentivize validators to stop mining as much MEV as possible, then memecoin traders might have had enough and move to a fast and cheap chain with less extraction potential. MEV mining, like Ethereum Base L2, then Solana would be a ghost chain. I think this story writes itself. The SOL/ETH ratio significantly overestimates Solana’s durability as a serious competitor to Eth L1 or our best L2s.
This ongoing debate highlights the heated rivalry between SOL and ETH as well as the complexity of governance in decentralized networks, technical challenges associated with MEV, and strategic decisions that can significantly impact the perception and functionality of blockchain ecosystems.
At press time, SOL was trading at $158.03.
Featured image of CoinDCX, chart from TradingView.com