Hello Rocket Poolers! It’s been a busy month at the Rocket Pool HQ, and for ETH2 in general, as client teams such as Prysmatic Labs have begun slowly rolling out their own testnets. In this update we’ll be covering our continued work on our upcoming public beta release, our potential rETH token and new mechanics introduced which provide even more safety for your staking deposits. We’ll also look at some details of our smart node software package design to help improve upgradability, scalability and monitoring(ility). Phew!
But before we dive right in, want to know a bit more about Rocket Pool and its founder David, but don’t want to spend 10 mins digging through google? Well Token Talks with Zach DeWitt has you covered. In his podcast, Zach covers the best emerging projects in crypto through unbiased and exclusive interviews with blockchain technology founders. In this talk, he uses his silky- smooth radio voice to talk to David about Rocket Pool and our plans for the staking future of Ethereum. Be sure to give it a listen.
Rocket Pool — Wait, what, who?
If you’re not familiar with Rocket Pool, here’s a quick run-down before we get into the details of the development update.
Rocket Pool is a next-generation Ethereum proof of stake (PoS) infrastructure service, designed to be highly decentralised, distributed and compatible with Casper 2.0, the new consensus protocol that Ethereum will transition to in late 2019.
We offer any user, business, corporation, pool, wallet provider, exchange, hedge fund — just about any service — the ability to provide their users with the option to earn interest on their ether holdings for a fixed term without worrying about maintaining an extensive staking infrastructure, just plug and play.
Rocket Pool has a long history in Ethereum and work on it originally began in late 2016 after the Mauve paper was released by Vitalik Buterin. This provided an early functional spec for Ethereum’s new consensus protocol called Casper which would allow users to earn interest on a deposit of Ether. Since then, Rocket Pool has grown and evolved into a next-generation staking network, aiming to allow businesses and their users to earn interest on their ether and to empower users who wish to stake on their own node by providing them with additional income on top of interest awarded by Casper.
Rocket Pool 2 Beta
As progress towards our next public community beta continues unabated, we showed you in our last update how the UI is shaping up for an Ethereum 2.0 staking network and pool. This new UI approach is focused on simplicity and ease of use - you can literally start staking within seconds of hitting the site using MetaMask or other web3 compatible software.
Those contract integrations are now complete and testing is now the main objective before we let the public have at it. This next beta is significantly bigger than our first - you’ll be able to stake ETH (well, fake ETH) and even test out our smart node software as a node operator. This will allow you to add your own node to the Rocket Pool network, with a minimum stake of 16 ETH (not 32 like outside of RP). This amount is also fee-free from us (hey, you’re helping the network out) and you get an additional return on top of it in the form of a network-determined fee charged to users who have their ETH assigned to your node for staking. Wow.
We’ll be giving a launch date for the upcoming beta in the near future, but we can say that every user in the community who tests it out will receive a share of 10,000 RPL given away once it concludes. The Ethereum community has been fantastic to us and we intend to return those well wishes as best we can.
The next iteration of Ethereum will be rolled out in several phases. Phase 0 will be the start of the beacon chain, a new chain that forms the base of ETH2. It will allow users to register their node as a validator, via a 32 ETH deposit on the current Ethereum 1.0 chain, and earn rewards on their staked ETH.
This staked ETH is effectively locked on the beacon chain until phase 2 of the ETH2 rollout. The time between phase 0 and phase 2 could be significant, so we’ve been in the lab weighing up several options that might allow Rocket Pool users to get liquidity for their deposits with us.
Currently we are not locked into any one approach, and are evaluating all new ideas (such as a proposed ETH1->ETH2 bridge) as they pop up. But rather than sit on our hands, we’re taking the pragmatic approach of pushing forward with rETH, until something better arises (if it does).
rETH is a new token that exists just for Rocket Pool 2 users. When you stake with Rocket Pool in phase 0, you will receive these tokens when you withdraw. These give our users a source of liquidity during this transition period, they could be traded or sold as desired until access to the real ETH on the beacon chain is available, at which point they could be traded in. We would also charge our fees in rETH in the meantime so we are using the same service we offer our users.
We currently aren’t locked into this idea as it would centralise part of our service (although all network node staking would still be decentralised and highly distributed); we’d have to be responsible for porting over rETH balances to the new Ethereum chain in phase 2 when smart contracts are supported.
We’re open to feedback on this idea and will be integrating it into the beta just for testing.
Currently Rocket Pool has developed a new technique called ‘chunking’. No, it’s not what your uncle did at your last Xmas gathering after too many drinks. This technique breaks up deposits into chunks of 4 ETH and distributes them around the network to random nodes when capacity is available. This means deposit safety scales linearly with the size of your deposit; you’re basically not putting all your eggs in one basket. If one of these chunks ends up on a dodgy node, only a portion of your deposit is affected.
With a change to some mechanics in Rocket Pool, we can now say that if you deposit with us, even if a chunk of your deposit ends up on a dodgy node that is penalised, that node operator will subsidise the users out of their original 16 ETH deposit. Whaaat?
If you run a node in the Rocket Pool network, you are only required to deposit 16 ETH, and you earn rewards on your own deposit — plus those from users assigned to your node — all fee-free. That’s a great deal! So, to make sure all node operators are fully accountable for users assigned to them, we now utilise the node operator’s 16 ETH deposit to compensate any users on their node who are affected by significant downtime.
If a node is down for a disastrously long time, to the point where its combined 32 ETH deposit is reduced to 16 ETH due to penalties, it is automatically ejected from staking and the 16 ETH remaining is given to the users as compensation for being on such an amazingly terrible node. They won’t get rewards on their ETH that was on this particular node, but they also won’t lose much, if any. Rocket Pool also doesn’t receive any fees from these users, ’cause we’re not bastards like that; they already had terrible luck so we won’t rub it in.
Smart Node Package
If you want to run a node and stake in the Rocket Pool network, you’ll need to install our smart node package. This will get you up and staking with a node quickly! It will feature an installer that allows you to select which beacon chain client you’d like to use (Prysm, Lighthouse, Nimbus etc), which ETH1 client you’d like to use (Geth/Parity/Infura) and our own CLI software which will allow you to interact with the Rocket Pool network, make deposits and more.
To improve our smart node package, we’re overhauling certain aspects of it to improve deployment, scaling and monitoring abilities for regular users, and to allow professional devops users with Kubernetes skills to deploy and easily manage as many Rocket Pool nodes as they want.
As you can see above, we’ll be utilising docker containers for each component of our smart node software stack. This will allow node operators to swap various clients (beacon chain, main chain) in and out without missing a beat. Updates will be easier to push, monitoring will be customisable and scaling will be much easier. We’ll have more on these changes in our next update.
Questions or just say hello!
Well this turned out a bit longer than expected, 10 points to you for making it this far! If you have questions or want to know a bit more about us, why not swing by for a chat and say G’day! You can view our website or have a chat with us in our chat room that anyone can join. If chat rooms aren’t your thing, we’re also on Twitter!