Lido Team Accuses Rocket Pool of Centralization

Lido Team Accuses Rocket Pool of Centralization

The Lido team has recently made accusations against its competitor, Rocket Pool, claiming that it is too centralized. Both Lido and Rocket Pool are liquid staking protocols that enable users to delegate their cryptocurrency to validators and receive derivative tokens in return. Lido’s community staking lead, Dmitry Gusakov, highlighted in a social media post that the Rocket Pool contracts are controlled solely by the Rocket Pool team. This control allows them to modify parameters and execute any method within the contracts. Consequently, Rocket Pool developers have the ability to manipulate the inflation rate and increase fees significantly. In contrast, Gusakov emphasized that Lido’s contracts are governed by a decentralized autonomous organization (LidoDAO), ensuring that such actions are fully controlled by the community.

Rocket Pool Acknowledges Vulnerability

In response to the accusations, Waq, a member of the Rocket Pool Grants Management Committee, acknowledged the existence of the vulnerability and assured that it will be rectified in the future. Waq further accused the Lido team of attempting to take credit for discovering a known issue. According to Gusakov’s post, the vulnerability stems from the “guardian” parameter found within the RocketStorage contract at Ethereum address 0x1d8f8f00cfa6758d7bE78336684788Fb0ee0Fa46. Several functions in Rocket Pool contracts are restricted to be called solely by the account listed in this parameter. Currently, the RocketPool deployer account at 0x0cCF14983364A7735d369879603930Afe10df21e holds this privileged position. Actions such as modifying the “RPL InflationIntervalRate” or the “ETH DepositFee” can be executed exclusively by the “guardian,” enabling the team to potentially manipulate the Rocket Pool governance token (RPL) inflation rate or even confiscate users’ deposits by setting the fee to 100%.

Community Response and Efforts Towards Decentralization

Chris Blec, a content creator, shared Gusakov’s post, emphasizing that it demonstrates that Rocket Pool’s supposed decentralized autonomous organization (pDAO) is not truly decentralized. According to Blec, the governance of Rocket Pool is not genuinely controlled by RPL token holders. In response, Jasper.lens, a RocketPool community advocate, clarified that the community is already aware of the centralization issue and plans to address it in the upcoming Saturn upgrade. Jasper explained that during the initial testing phase, Rocket Pool decided against implementing on-chain voting for their DAO. This decision inadvertently led to centralization concerns. However, after completing extensive testing, the upcoming Saturn upgrade aims to rectify these centralization vulnerabilities.

Rocket Pool’s Commitment to Fixing Centralization

In agreement with Jasper.lens’ statement, Waq affirmed that the Rocket Pool community has been diligently working for over a year to address this centralization issue. Waq also predicted that the Lido team would hastily claim credit for the resolution, as they have done in the past. Nonetheless, once the problem is resolved, Rocket Pool intends to ensure that their platform operates in a more decentralized manner.

Advancement of Liquid Staking Protocols

Liquid staking protocols have gained significant popularity in recent months. DefiLlama, a blockchain analytics platform, reported on May 1 that these protocols have surpassed decentralized exchanges as the leading category in terms of total value locked within the DeFi sector. Furthermore, Tenet’s partnership with LayerZero on May 30 aims to expand the implementation of liquid staking to additional blockchains in the future.


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