Confluence Protocol Upgrade November Update
At the beginning of September, the Livepeer Inc. development team published a preliminary proposal for Confluence, an upgrade to the Livepeer protocol to reduce gas fees and to drastically reduce costs for Livepeer network users. Since then, the team has been working on transforming the preliminary proposal into a formal LIP and implementation that can be considered by the community as a part of protocol governance by:
- Designing the mechanics for migrating stake to L2 and using protocol contracts on L2
- Implementing the contract code required for the aforementioned designs
- Identifying a general blockchain scaling strategy for the Livepeer protocol that Confluence can be aligned with
- Planning for a Confluence public testnet
Find below a list of more specific updates from the team around these areas.
LIP and Engineering Progress
- Published LIP-73: L2 Stake Migration which describes a design for orchestrators and delegators to migrate stake from L1 to L2 without waiting through the unbonding period
- Completed a round of gas benchmarking of protocol contract transactions on Arbitrum and estimated a 50–100x cost reduction for staking, reward and payment settlement transactions relative to L1
- Decided to proceed with implementation for LIP-73 using Arbitrum as the target L2. The team is planning on having an open conversation in Discord next week to break down the thought process for using Arbitrum in the short term as well as how that decision fits into a bigger picture scaling strategy for the Livepeer protocol (see “Scaling Strategy” more more details)
- Explored designs for running protocol contracts on L2 with the biggest consideration being how to handle protocol inflation. Initially, the team published LIP-74: L1 Minting and L2 Staking which describes a design for keeping protocol inflation on L1 and sending newly minted LPT to L2 for distribution. However, after some discussion and identifying additional technical requirements for LIP-74 that may outweigh the benefits of the proposal, the team has been focused on an alternative design that enables protocol inflation on L2 instead which should be simpler, with fewer additional technical requirements to implement. The plan is to share an updated proposal with this new design soon
- Began implementation of a bridge (spec) to move LPT between L1 and Arbitrum which is a requirement to support the LIP-73 stake migration process
Scaling Strategy
- Proposed a scaling strategy for the Livepeer protocol with the goal of unlocking cost savings for network users in the short term while ensuring flexibility to take advantage of future blockchain scaling solutions
Public Testnet
- Began planning for a public testnet that community members will be able to participate in to help test and get familiar with the stake migration process for Confluence
Next Steps
The top priorities for the team going forward are:
- Share an updated proposal for running protocol contracts on L2 with specific details on handling protocol inflation
- Complete the Arbitrum LPT bridge implementation
- Complete the LIP-73 stake migration implementation
- Share details for the Confluence public testnet. Stay tuned for more updates on this front in the coming weeks!
If you have any questions or comments, or would like to get involved in the discussion around the Confluence protocol upgrade, jump into any of the following forum threads:
