Some evidence for the prosecution …
We have been conducting a longitudinal study of the state of cryptocurrency networks, including Bitcoin and Ethereum.
Neither Are All That Decentralized
Both Bitcoin and Ethereum mining are very centralized, with the top four miners in Bitcoin and the top three miners in Ethereum controlling more than 50% of the hash rate.
The entire blockchain for both systems is determined by fewer than 20 mining entities [4]. While traditional Byzantine quorum systems operate in a different model than Bitcoin and Ethereum, a Byzantine quorum system with 20 nodes would be more decentralized than Bitcoin or Ethereum with significantly fewer resource costs. Of course, the design of a quorum protocol that provides open participation, while fairly selecting 20 nodes to sequence transactions, is non-trivial.
Thus, we see that more research is needed in this area to develop permissionless consensus protocols that are also energy efficient.
Ethereum Wastes Mining Effort That Can Be Put To Better Use
Ethereum has a much higher uncle rate than Bitcoin’s pruned block rate. This is by design, as Ethereum operates its network closer to its physical limits and achieves higher throughput. As a result, however, less of Ethereum’s hash power goes towards sequencing transactions than Bitcoin’s. Put another way, some hash power is wasted on uncles, which do not help carry out directly useful sequencing work on the chain.