Why Infrastructure Centralization Invites State-Level Attacks

Over 70% of Ethereum traffic flows through centralized RPC providers like Infura and Alchemy. A state-level takedown order or network-level blocking (as seen with Tornado Cash) could censor or cripple major dApps and wallets.

• Single Jurisdiction Risk: Infrastructure concentrated under US/UK legal frameworks.
• Censorship Vector: Enables blacklisting at the infrastructure layer, bypassing L1 resistance.
• Data Monopoly: Creates a honeypot of user metadata and transaction graphs.

Dominant cross-chain bridges (e.g., LayerZero, Wormhole, Arbitrum) and L2 sequencers (e.g., Arbitrum, Optimism) rely on centralized multisigs or committees. A state can compel these entities to freeze funds or halt chains.

• TVL at Direct Risk: $10B+ in bridge contracts controlled by <10 entities.
• Protocol Failure: A halted sequencer stops an entire L2 chain, a digital siege.
• Regulatory Capture: Becomes the easiest point for enforcement, as with OFAC-compliant blocks.

The MEV supply chain (searchers, builders, relays) is dominated by a few entities like Flashbots. State actors can infiltrate or co-opt this stack to extract value, censor transactions, or deploy chain-level exploits.

• Systemic Risk: Centralized relay control can enforce blanket censorship.
• Value Extraction: A compromised builder can siphon millions per day via predatory MEV.
• Opaque Stack: Lack of client diversity creates blind spots for detection.

Mitigation requires architecting for byzantine fault tolerance at every layer, not just consensus. This means decentralized RPC networks (e.g., POKT Network), permissionless validation, and credibly neutral sequencing.

• Client Diversity: Eliminate single-client dominance (Geth).
• P2P Primitive Revival: Invest in libp2p and lightweight clients for direct chain access.
• Intent-Based Abstraction: Shift risk to users via UniswapX, CowSwap-style solvers, reducing systemic bridge TVL.

The OFAC sanctioning of the Tornado Cash smart contract addresses demonstrated that infrastructure centralization is a liability, not just for front-ends but for core protocol logic. The attack vector was the centralized reliance on Infura and Alchemy for RPC access.

• Key Impact: Major RPC providers blocked access, bricking dApp functionality for compliant and non-compliant users alike.
• Systemic Risk: Exposed how a single point of failure in the data layer can be weaponized to censor an entire application layer.

Following the Merge, the dominance of a few centralized block builders like Flashbots created a trivial censorship vector. Regulators only needed to pressure 2-3 entities to achieve >51% network-level censorship.

• Key Impact: Demonstrated MEV supply chain centralization enables low-cost state coercion.
• The Precedent: Shows that even "decentralized" L1s are vulnerable when their critical infrastructure (block building, relay networks) is centralized.

During the 2022 OFAC compliance updates, Infura—serving ~90% of all Ethereum traffic—incorrectly flagged the canonical chain as non-compliant. This caused MetaMask and other major dApps to temporarily display incorrect balances and stall transactions.

• Key Impact: A single engineering error at a centralized RPC provider created widespread chain reorg confusion.
• The Lesson: Infrastructure monoculture turns operational mistakes into network-wide crises, proving that reliance on a handful of providers is a critical security flaw.

Solana's RPC layer is dominated by QuickNode and Alchemy, creating the same centralization risks seen on Ethereum. High-performance requirements have led to infrastructure consolidation, making the network susceptible to the same state-level coercion.

• Key Impact: Performance demands have paradoxically bred centralization, replicating Ethereum's critical vulnerabilities.
• The Pattern: Shows that even high-throughput L1s are not immune; the economic logic of running infrastructure leads to dangerous consolidation unless actively designed against.

>90% of Ethereum traffic flows through centralized RPC providers like Infura and Alchemy. This creates a single point of censorship and failure, as seen when Tornado Cash sanctions were enforced at the infrastructure layer.

• Vulnerability: A state can blacklist addresses or censor transactions by pressuring a few corporate entities.
• Solution: Decentralized RPC networks like POKT Network and Lava Network distribute requests across thousands of independent node operators, eliminating this vector.

$20B+ in bridge TVL and ~90% of L2 transaction ordering are controlled by small, trusted committees. This is a systemic risk, inviting targeted regulatory or technical attacks on the single entity controlling funds or sequencing.

• Vulnerability: A compromised or coerced bridge multisig or sequencer can freeze or steal user funds, halting entire ecosystems.
• Solution: Intent-based bridges (Across, layerzero) and decentralized sequencer sets (Espresso, Astria) replace trusted operators with cryptoeconomic security and shared sequencing markets.

Reliance on a single Data Availability (DA) layer like a centralized sequencer's mempool or a sole DA committee creates a censorship point. An attacker can prevent state updates by denying data publication.

• Vulnerability: A state can force a DA provider to withhold data, bricking rollup state transitions and freezing DeFi (Uniswap, Aave) and NFT markets.
• Solution: EigenDA, Celestia, and Avail provide decentralized DA with cryptoeconomic guarantees, while EIP-4844 proto-danksharding decentralizes data posting on Ethereum itself.

Block building is centralized around a few dominant builders (e.g., via MEV-Boost). This allows sophisticated actors, including states, to perform time-bandit attacks, reorg chains, or implement generalized frontrunning at scale.

• Vulnerability: Centralized block production enables transaction censorship and undermines consensus fairness.
• Solution: SUAVE aims to decentralize the MEV supply chain by creating a neutral, open marketplace for block building, separating it from proposing.

$50B+ in DeFi TVL relies on price feeds from a handful of oracle networks (Chainlink, Pyth). While decentralized in design, node operation and data sourcing have centralization pressures, creating a critical attack surface for market manipulation.

• Vulnerability: Compromising a major oracle can lead to cascading, protocol-wide liquidations and insolvencies.
• Solution: Redundant oracle design, cryptoeconomic slashing, and first-party data (e.g., Uniswap's TWAP oracles) reduce reliance on any single truth provider.

The ultimate decentralization is sovereignty. App-chains and rollups that control their own sequencing, DA, and settlement are harder to attack en masse but face higher complexity and liquidity fragmentation.

• Vulnerability: Monolithic L1s and shared L2s present a single, large target for regulation or technical attack.
• Solution: Rollup-as-a-Service platforms (Conduit, Caldera) and modular DA layers enable teams to launch sovereign chains with decentralized stacks by default, trading off some interoperability for resilience.