Ethereum researcher reveals IP-address tracking of stakers

A researcher from the Ethereum Foundation (EF), Justin Drake, on the Bankless Bankless podcast said that validators provide a large amount of data when staking ETH, including IP addresses.

Drake said he knows about this practice from within.

“There is a lot of metadata — deposit addresses, withdrawal addresses, recipients of fees, IPs, a validator’s presence in the network, and much more,” noted an EF representative.

According to him, collecting this information makes it possible to identify major players in the space and limit their participation in events aimed at retail users.

“We know who here are Kraken or Coinbase, and we can simply not airdrop them if the airdrop is targeted at individual validators,” Drake said.

Users in the comments raised questions about centralization of protocol governance and data collection. Some drew an analogy with George Orwell’s novel 1984.

The real surveillance coin is Ethereum, you have been warned…. https://t.co/3352b3SdeY

— DR8DU5 PR8T0R1A (@PrivateerX) April 13, 2023

“Ethereum — this is the real surveillance coin. You have been warned,” wrote one of the commenters.

The account owner, Richard “Dick” Whitman, sarcastically paraphrased Drake:

“We can stop censorship by restricting what we don’t like.”

The DeFi researcher, writing under the pseudonym DeFi Crypto Vaults, urged Ethereum users to take steps to protect themselves from data analysis and potential fraud. The expert recommended switching to Linux, consistently using a VPN, and hardware wallets such as Ledger.

In January, cofounder Ethereum Vitalik Buterin named privacy “the biggest remaining problem” of the network and proposed stealth addresses as a solution.