Vitalik Buterinethe founder of Ethereum, recently suggested a series of changes aimed at improving the network’s staking model. The primary objectives are to improve decentralization and reduce the computational burden on the consensus layer. The proposal comes as Ethereum faces challenges related to centralization risks and the sheer number of signatures required for consensus. Buterin’s proposal could potentially revolutionize the way staking and consensus are approached on the Ethereum network, making it more accessible and efficient.
In the current Ethereum staking model, there are two types of participants: node operators and delegators. Node operators are responsible for running nodes and providing collateral, usually in the form of ETH. Delegators, on the other hand, contribute a certain amount of ETH but are not required to participate otherwise. This two-tiered staking model has been popularized by staking pools such as Rocket Pool and Lido, which offer liquid staking tokens (LSTs). However, Buterin identifies two major problems with this system. First, there is a risk of centralization in the mechanisms for choosing node operators, which are either not very decentralized or have other shortcomings. Second, Ethereum Layer 1 verifies approximately 800,000 signatures per epoch, a number that could increase, adding a significant computational burden to the network.
To address these issues, Buterin suggests that delegators need to play a more meaningful role in the network. He outlines two classes of solutions: delegation selection and consensus participation. In the delegation selection model, delegates can choose which node operators to support, giving them “weight” in the consensus. This would give them more power and make the network more decentralized. In the consensus participation model, delegators could be given a lighter role in the consensus process, which would act as a check on node operators. This would allow more people to participate in the network validation process without taking on the full responsibilities and risks of a node operator.
Buterin also provides concrete implementation ideas for these solutions. One such idea is to have each validator specify two staking keys: a persistent staking key (P) and a fast staking key (Q). These keys can be used in various ways to improve the consensus mechanism and reduce the number of signatures required. For example, the protocol might require both the node and a randomly selected delegator to unsubscribe from a message from a node to count.
In conclusion, Buterin wants to achieve two important objectives with his proposal. Primarily, it seeks to enable those who do not have the resources or ability to make a solo bet to meaningfully participate in the network. Second, it aims to reduce the number of signatures needed for consensus to around 10,000, promoting decentralization and making it easier for more people to run a validating node. These changes can be implemented at different layers, including within staking pool protocols or as part of the Ethereum protocol itself, providing a flexible approach to improving the network’s staking model.
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