In what is an important move for both the platform and the cryptocurrency, Coinbase has officially become Ethereum’s largest node operator. Indeed, the crypto exchange officially operates 120,000 validators, controlling more than 11.4% of total staked Ethereum, according to its first Ethereum Validator Performance Report.

Additionally, the platform reports 99.75% validator participation and uptime. Indeed, it verifies the vital place that the platform plays in the overall ETH ecosystem. However, there are some concerns being raised by users regarding the concentration of the stake to a single entity.

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Coinbase Controls 11.42% of all Staked Ethereum According to New Report

It has certainly been a difficult year so far for Ethereum. Just this month, Standard Chartered revised its price target for ETH, slicing it by more than 60%. Additionally, it has failed to gain any sort of momentum amid the market downturn that has hindered much of the industry.

Now, a new development has arisen that has some users worried about what it could mean for the security of the platform. However, it is also a rather important developer for Coinbase, as it has officially become Ethereum’s largest node operator. Moreover, it has taken the lead by a wide margin, according to its most recent report.

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The detailed report notes different metrics, such as a 99.75% participation rate and uptime that ensure staked assets continue generating rewards at an efficient rate. Moreover, Coinbase notes that there have been no instances of slashing or double signing. This is a good sign for users’ funds, as it ensures security.

However, the increase in the share of Coinbase has only reinforced decentralization questions. One user on X (formerly Twitter) noted this. Specifically, they said the 11.42% stake “raises red flags for network security.” They did share that the transparency was good, but pushed for the need for greater distributed validation. That feeling is one likely shared by many in the community.