AWS Outage Hits Ethereum and Crypto: How Dependent Is Web3 on Amazon’s Cloud?

• Why Did the AWS Outage Cripple Ethereum and DeFi?
• Cloud Reliance by the Numbers: Who Controls Crypto’s Plumbing?
• Three Hidden Risks of Cloud-Based Crypto Infrastructure
• Are Decentralized RPC Networks the Solution?
• The Irony of “Decentralized” Tech Running on Amazon
• How the Industry Is Reducing Cloud Dependence
• Will Crypto Ever Truly Decouple from Big Tech?
• FAQs: AWS, Crypto, and the Centralization Dilemma

A recent AWS outage exposed the crypto industry’s heavy reliance on centralized cloud providers, disrupting Ethereum, Polygon, and other major blockchains. While decentralization remains a core ethos, the incident highlights a glaring contradiction: much of Web3 still runs on Amazon’s servers. This article explores the risks, ongoing efforts to reduce dependency, and why true decentralization remains elusive—for now.

Why Did the AWS Outage Cripple Ethereum and DeFi?

When Amazon Web Services (AWS) stumbled on October 21, 2025, the crypto world felt the shockwaves. Critical infrastructure like Infura—Ethereum’s backbone for wallets (MetaMask) and apps (Uniswap)—went dark. Why? Because Infura’s nodes predominantly run on AWS. The result? Users faced error messages instead of transactions, proving that even decentralized blockchains rely on centralized gateways. As one frustrated trader tweeted: “So much for ‘unstoppable’ money.”

Cloud Reliance by the Numbers: Who Controls Crypto’s Plumbing?

Data from Ethernodes reveals a sobering truth: 50% of ethereum nodes still operate on centralized hosts like AWS, Hetzner, or OVH. Back in 2022, Messari reported this figure was 70%, with AWS alone hosting over half. While progress has been made, the dependency remains critical. For context, imagine Visa’s network going down because a single data center failed—that’s essentially what happened here.

Three Hidden Risks of Cloud-Based Crypto Infrastructure

1.AWS outages can paralyze multiple chains simultaneously (Ethereum, Polygon, Arbitrum).
2.Cloud providers could theoretically block validators, as Hetzner did to solana in 2022.
3.Most nodes sit in U.S.-controlled data centers—hardly a globalized vision.

Are Decentralized RPC Networks the Solution?

Projects like Ankr and Lava are pioneering decentralized RPC networks, distributing requests across independent nodes. In theory, this could break the AWS stranglehold. But adoption lags due to technical complexity. As Infura’s outage proved, convenience often trumps ideology in crypto’s real-world deployment.

The Irony of “Decentralized” Tech Running on Amazon

Here’s the kicker: Blockchains themselves kept running during the AWS crash—but without Infura’s RPC endpoints, average users couldn’t access them. It’s like having a bulletproof car with no keys. This paradox fuels critics who argue Web3 is just Web2 with crypto paint. Even Binance faced similar heat during an April 2025 outage.

How the Industry Is Reducing Cloud Dependence

Ethernodes data shows centralized hosting dropped from 70% to 50% since 2022. Some teams now mandate multi-cloud setups or bare-metal servers. But as a BTCC analyst noted, “Until decentralized alternatives match AWS’s uptime, the trade-off between resilience and reliability persists.”

Will Crypto Ever Truly Decouple from Big Tech?

Unlikely soon. AWS offers unmatched scalability—crucial for chains processing millions of transactions. While idealists push for self-hosted nodes, the reality (and gas fees) deter most. Perhaps the answer lies in hybrid models, where critical services diversify across providers. One thing’s clear: October’s outage was a wake-up call.

FAQs: AWS, Crypto, and the Centralization Dilemma

Which crypto services were hit hardest by the AWS outage?

Infura’s Ethereum RPC endpoints failed, disrupting MetaMask, Uniswap, and apps relying on affected chains (Polygon, Arbitrum, etc.).

Why doesn’t Ethereum just abandon centralized hosting?

Cost and complexity. Running independent nodes requires technical expertise and higher expenses—barriers for mainstream adoption.

Has this happened before?

Yes. Similar outages impacted Solana (2022) and Binance (April 2025), underscoring a systemic vulnerability.