Hardly anyone knows them, but without the company Infura not much would work at Ethereum. Based in New York, USA, the company has been the silent giant behind the network since 2016. As the largest API provider for Ethereum, it connects over four hundred apps such as Brave or Metamask to the blockchain. We met one of the co-founders, EG Galano, 38, at ETHBerlin. How did Infura get so big? And what does Galano think about the merge and the criticism of Proof of Stake? a conversation
BTC-ECHO: How did Infura come about?
EG Galano: I came into the blockchain space in late 2015 and met Joe Lubin, one of the brains behind Ethereum and the founder of ConsenSys. Me and my later co-founders provided the infrastructure for nodes to some of the teams within ConsenSys. And we decided to offer that with Infura as a service. One of our first customers in 2016 was the popular virtual wallet Metamask, also developed by ConsenSys.
BTC-ECHO: How exactly does your service work?
Galan: Blockchains are peer-to-peer networks. One of the earliest of this type is BitTorrent. If you want to upload or download something in such a network, you need a technical interface that connects you to it, the API. In the case of blockchains, this means that if you want to write transactions or read data, you need a network node and a few gigabytes of data storage. Both require resources and technical know-how. We provide this interface for many apps on Ethereum, for example Metamask or Uniswap, the largest decentralized exchange in the world.
BTC-ECHO: Many were afraid that something would go wrong with the merge. were you excited
Galan: I was up all night watching the live stream. Disaster could always have happened, but we were very close to testing and I was very confident that it would work. The intensive preparatory work has paid off.
BTC-ECHO: Where do you see the greatest benefit for Ethereum from the merge?
Galan: Energy consumption drops drastically. Especially people who were new to crypto made it a bigger problem than it actually is. We are now carbon neutral. It’s a good argument to use Ethereum. It also encourages competition in space. We can now fully focus on usability. The merge was only the first step in a great vision. The coming months and years will be about making Ethereum faster. I’m particularly looking forward to that.
BTC-ECHO: Top crypto exchanges like Coinbase hold over 30 percent of the stake and counting. Don’t you just swap the big banks for big stock exchanges? How is this better than Proof of Work?
Galan: I don’t see it as particularly different from mining. Proof of Stake replaces the capital used for mining by locking a stake in the smart contract and receiving rewards for it. With mining, your share grows with the value of the infrastructure you use. It’s the same with staking. If it’s a problem, it’s one that existed before. I’ve seen the tweets that claim what you say.
But there is a mechanism for decentralization with Proof of Stake. We can set an entity’s rewards to decrease when it meets certain criteria. For example: We see too many people running their nodes on cloud servers, like Amazon Web Services. We can make a list. Of course you can run them over it, but if a certain amount of people do that, all of their staking rewards will decrease. There would be discussions, a client would have to be programmed. If you don’t agree, you can hardfork the blockchain at any time.
BTC-ECHO: Over 50 percent of Ethereum’s network nodes run on Amazon Web Services. Jeff Bezos could turn off the tap. The German cloud service provider Hetzner has already done this. Is there a risk of network censorship?
Galan: I see it as a deplatforming risk. You need an exit or backup strategy for such cases. We have a partnership with Microsoft and Azure. We built physical data centers to ensure we don’t become dependent on a cloud provider. Amazon wouldn’t just take us offline, they would let us know in advance, at least 24 hours. You are a reputable company. For Ethereum there would be a short disruption at most, then the system would go online again. Someone will say: all these block rewards don’t go to anyone because everyone’s out, and I’m going to be the person who gets them. The financial incentives and the fact that it’s a validator would, I believe, lead to the network stabilizing itself as the design intended.
BTC-ECHO: Where do you see the Ethereum ecosystem in ten years?
Galan: We’re building the best tools right now and handing them over to the developers. I love that. Today we work with concepts that were hardly known to anyone three years ago. In ten years I would like to see that we have refined the tools so that normal users can interact with a blockchain without realizing it. You won’t be able to tell it apart from the traditional internet.
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