SafeStake’s Impact on Ethereum: Expanding the Validator Base to Ensure Finalization of Transactions
Back in May, the transactions waiting to be finalized on Ethereum did not reach their destination for the first time in the blockchain’s history.
According to a post-mortem report from the team at Prysmatic Labs, the blockchain experienced a significant lack of block production that lasted for 13 epochs (around 78 minutes) between May 11 and 12, 2023, resulting in a delay in the completion of transactions.
The cause — around 65% of the blockchain’s validators, all running either the Prysm or Teku consensus client, went offline at the same time. The result — these validators incurred downtime penalties that totalled a loss of around 78 ETH in missed attestations and block proposals, not to mention the significant delay in transactions finding their home in a block.
This event highlights the need for a large and diverse set of validators to participate in consensus to secure the Ethereum blockchain in a more decentralized way.
But what is finality in Ethereum?
One of the major challenges that proof-of-stake (PoS) consensus mechanisms face is the risk of finality failure. In Ethereum, finality equals security, and refers specifically to the guarantee that a block cannot be altered or removed from the blockchain without burning at least 33% of the total amount of staked ETH.
In this way, ‘crypto-economic’ security works to prevent malicious actors from modifying the contents of the blockchain as it would be far too costly to do so.
Transaction finality in Ethereum happens when more than two-thirds of the votes from the entire group of validators are gathered, allowing transactions to be finalized and permanently recorded on the blockchain, and guaranteeing their immutability (inability to be altered).
Because Ethereum is secured by a mechanism where validators come to consensus about the state of the blockchain, those validators must remain online at all times to validate transactions and create new blocks.
To raise a red flag when transaction finality is at risk (i.e. a large number of validators are offline), Ethereum has an emergency protocol called “inactivity leakage.” The purpose of inactivity leakage is to create the necessary conditions for the chain to regain finality.
As previously mentioned, a two-thirds majority of the staked ETH (validators) must agree on both the blockchain’s origin and destination checkpoints. Now, suppose validators representing more than one-third of the total validators are suddenly disconnected, as was the case in May, with the validators running the Prysm/Teku clients. When this happens, completing the checkpoints by a two-thirds majority becomes an impossible task.
However, thanks to inactivity leakage, the participation of inactive validators gradually decreases over time, until they represent less than 1/3 of the total validators. So, no matter how large the group of inactive validators is, in the end, the active validators will control more than 66% of the stake, and finalize the chain.
Last May’s events demonstrated for the first time how Ethereum handles the disconnection of a large number of validators, thanks to the activation of the inactivity leakage protocol. Despite bugs that existed in the Prysm and Teku consensus clients, which make up more than 50% of the clients available, Ethereum was able to quickly recover and finalize on-chain transactions.
How can we reduce the risk of finality failure?
While the emergency “idle leak” protocol has allowed Ethereum to come out on top in the isolated events of last May, there has been much debate recently about the best steps to take to improve the resiliency of the blockchain network.
The investigation that followed the transaction completion failure revealed that the LMD-GHST protocol also successfully contributed to Ethereum’s return to normalcy, making the hiccup almost unnoticeable to users in terms of gas costs and time for transactions to complete.
Nonetheless, discussions have cropped-up around the acceleration of SSF (single slot finality) implementation and extending the maximum upper limit per validator from 32 to 2,048 ETH, sometimes becoming heated among the Ethereum core developers and the user community seeking to mitigate the risks of transaction finality failure.
Whatever the case, we believe that the most effective solution is likely to be the one that is focused on helping the blockchain’s validator base become more resilient and resistant to issues that would cause large numbers of them to go offline in the first place. In that type of environment, stop-gaps like inactivity leak and others become last resorts in the event of a major blockchain catastrophe.
This is where SafeStake’s cutting-edge DVT (Distributed Validator Technology) solution comes in.
SafeStake is a staking platform that employs distributed validators running on a permissionless network of independent, decentralized operators. Operators are spread out geographically and have the ability to run their nodes as they see fit, as long as they meet minimum performance and uptime requirements.
The result is a diverse and resilient validator network that significantly reduces the risk of transaction finality failure.
Increase the Validator Base
SafeStake is lowering the ETH staking threshold and implementing liquid staking plus DVT to allow more people to participate in running a validator and maximize their staking rewards. More validators helps increase the security and stability of the network.
Diversify the Validator Set
SafeStake validators run on a permissionless network of independent and decentralized operators that are spread out geographically and have different node configurations. The SafeStake protocol splits a validator private key into four (4) key shares and gives one share to each operator in the committee that will attest on behalf of the validator. Now, the validator is geographically decentralized and much more resistant to outages, as only three (3) out of the four (4) operators that attest on its behalf are needed for it to function properly.
Decentralize the Protocol Governance
SafeStake is governed by a decentralized community of stakeholders who have a say in its development and direction, ensuring the platform remains secure, stable, and resilient over time.
The SafeStake DAO is the entity that governs SafeStake, and is comprised of a broad network of DVT token holders who have the power to vote on proposals.
Final Thoughts
The fact that Ethereum experienced a non-completion event underscores both the effectiveness of its emergency protocols and the need for a more diverse and resilient set of validators. By embracing a variety of consensus clients and fostering a broad, diverse, and decentralized base of validators, the network can transcend the need for imposed mechanisms, like inactivity leakage, which may erode trust due to the need for human intervention.
It takes 2.5 epochs to finalize transactions, but the proposed SSF (single slot finality) advancement can significantly reduce this time. However, the success of such proposals relies heavily on the presence of a diverse and resilient validator base.
Recognizing this, SafeStake is on a mission to help prevent Ethereum finality failure by expanding the validator base and promoting diversity among its participants. Our commitment to achieving this goal is backed by an unwavering focus on implementing robust security features into the protocol that enhance the security and stability of the entire blockchain.
We believe SafeStake will play a vital role in fortifying the Ethereum blockchain, helping to ensure its continued reliability and trustworthiness in the face of future challenges.
About SafeStake
SafeStake is a pioneering technology company focused on revolutionizing Ethereum staking. With its cutting-edge, decentralized Distributed Validator Technology (DVT), SafeStake provides an ultra-secure, fault-tolerant environment for Ethereum validators, maximizing staking rewards and minimizing penalties. SafeStake is committed to driving the growth, innovation, and decentralization of the Ethereum network while ensuring the security and prosperity of its participants.
