Ethereum Foundation’s 10th AMA Highlights Validator Set, Randomness, DVT, and Technical Direction

Ethereum Foundation's 10th AMA highlights validator set, randomness, DVT, and technical direction.

Compilation | GaryMa Wu on Blockchain

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[AMA] We are EF Research (Pt. 10: 12 July, 2023)
by u/JBSchweitzer in ethereum

On July 12th, the Ethereum Foundation research team conducted the 10th AMA on the Reddit forum. Community members could leave comments and questions in the post, and the research team members would provide answers. Wu summarized the relevant questions/technical points from this AMA as follows:

1. Validator withdrawal: Validators are allowed to trigger withdrawal from their execution layer (0x01) by presenting a withdrawal certificate. If their balance is less than 16 ETH (due to penalties or confiscation events), validators will be kicked out of the protocol. Is the threshold of 16 ETH too low?

This is mainly related to the EIP-7002 proposal. It is understood that EIP-7002, jointly released by research and development developers including Danny Ryan, aims to allow validators to trigger withdrawal to the beacon chain from their execution layer (0x01) by presenting a withdrawal certificate. Currently, only the active key can initiate validator withdrawal, which means that in any non-standard custody relationship, the holder of the withdrawal certificate cannot independently choose to withdraw and start the withdrawal process. In order to ensure that withdrawal certificates held by EOAs and smart contracts can control the staked ETH without trust, this specification allows the withdrawal triggered by the 0x01 withdrawal certificate. This proposal will facilitate the development of liquidity staking and distributed validation, further promote the decentralization of the beacon chain, and better manage risks, such as private key loss or DVT validators losing connections with most shared keys.

2. Randomness problem: RANDAO + VDF

RANDAO is a way to generate random numbers. For example, if there are 10 students in a class and the teacher wants to randomly select one student to give a reward to. The teacher’s method is to ask all students to provide a random number at the same time. The teacher adds up the 10 random numbers and takes the remainder when divided by 10. The remaining number is the student to be selected. However, from the operation process of RANDAO mentioned above, a problem can be observed. If one student cheats and gives a random number after the other 9 students have provided theirs, the student can select a number that is most beneficial to themselves based on the information of the 9 random numbers, so that the final result points to themselves. Therefore, the effective operation of RANDAO requires the introduction of anti-cheating mechanisms, which means that everyone needs to provide answers at the same time. VDF also comes into play. VDF stands for Verifiable Delay Function, and the important characteristic of this function is that the calculation process of obtaining the result cannot be parallelized, i.e., it cannot be accelerated. However, once the result is obtained, the computation required for verifying the result is very small. VDF is implemented through hash functions, and the slow calculation and fast verification characteristics of hash functions also align with the properties of VDF.

However, team members of the research team have stated that the ultimate economic benefits of trying to exploit this “last proposer” vulnerability may not be ideal, and such deceptive behavior may seriously damage the reputation of validators.

3. Are SSV (Secret Shared Validators) and DVT (Distributed Validator Technology) necessary for Ethereum?

As Ethereum’s staking amount exceeds 20% and faces the centralization risk of potential node operators, two members of the research team believe that these technologies may be a “must” solution in the short to medium term.

Justin Drake stated that his recent thoughts have changed partially because in the long run, if one-time signatures are achieved, the importance of these risk challenges will significantly decrease. However, it may take decades to achieve one-time signatures, so DVT will be a more effective solution in the short to medium term.

One-time signatures are a special type of cryptographic signature where a private key can only be used to sign one message. It can solve many long-term problems in the blockchain field and provide numerous advantages, such as removing penalties, perfect finality, and trustless liquidity staking.

4. Maximum Effective Balance: Increasing the upper limit (32 ETH) of validator staking can reduce the number of validators in the network, thereby achieving faster transaction finality (single-slot finality), such as: 1) Keeping the upper limit of 32 ETH unchanged but limiting the number of network validators; 2) Considering including the number of validator attestations in the voting weight.

Option 1 would result in a market for trading the existing validator qualifications and introduce potential serious security risks.

Option 2 would change the security model of the protocol and reduce the difficulty for attackers to reorganize the chain.

Recently, there have been proposals in the community to increase the maximum effective validator balance from 32 ETH to 2048 ETH to help reduce the growth of the active validator set.

5. How is the progress of Single Secret Leader Election (SSLE) currently?

Vitalik stated that SSLE is still in the research stage, and its priority is relatively low as the non-secrecy of current leaders has not been proven to be a problem.

Note: Single Secret Leader Election refers to the fact that the proposers selected for each slot in the beacon chain are currently made public in advance, making them vulnerable to DoS attacks. The latest solution encrypts and hides this process so that only the proposers know their own identities, effectively mitigating potential risks.

6. Are there any updates to Ethereum’s technical roadmap?

Vitalik stated that most of the roadmap is progressing as scheduled, but there are also adjustments to the priority order. For example, due to the MEV-Boost vulnerability and the malicious validator attacks on MEV Bots in April, the priority of implementing protocol-level PBS (Proposer Builder Separation) will be increased, and concerns regarding potential security risks introduced by re-staking will increase the priority of optimizing and simplifying the solo staking experience.

In addition, in the overall direction, it is necessary to prioritize things that can effectively help many ecosystem-level issues, such as ERC-4337 smart wallets needing to implement friendly cross L2 and improve Gas efficiency.

7. Can EIP4844 solve the fragmentation problem of liquidity in L1 and L2?

The instant composability of zk-rollups (which may not be achievable between OP Rollups) does not depend on the completion of EIP4844. There is a huge design space for the composability and coordination between zk-rollups, and one possible solution is to have a dedicated minimal zk-rollup as a liquidity aggregator.

8. Has Justin Drake’s idea of Based Rollups to solve the ordering problem of Rollups (ordering on L1) been applied and implemented?

Based Rollups (or L1-ordered Rollups) means that the ordering of the Rollup network occurs on the L1 it is based on (in most cases, the Ethereum network). Specifically, in the case of Ethereum, this means that searchers, builders, and proposers on the network all participate in the ordering of the Rollup network.

Compared to traditional Rollup networks that handle ordering themselves, Based Rollups have many advantages. First, they rely on Ethereum for transaction ordering, so they can benefit from Ethereum’s activity. When discussing the risks of different Rollups above, we found that many problems could arise if the ordering mechanism or validators fail, but for Based Rollups, there is no such risk unless there is a problem with the Ethereum network. In addition, there are advantages such as decentralization and no need for tokens.

One of the Layer 2 zkEVM projects, Taiko, will be released in the form of Based Rollups.

Some people may confuse Based Rollups with sharing the memory pool with L1, but that is not the case. Rollups will have their own memory pool.

9. Concerns about the centralization risk of block builders?

Justin Drake stated that the current block builder market is already highly centralized (see https://www.relayscan.io/), and the main risk of centralization for block builders is censorship. Currently, a better solution is to have partial block auctions, such as inclusion lists, proposer suffixes, corrections to proposer suffixes: pre-commitment, and encrypted memory pools, MEV destruction, etc.

10. If the number of validators exceeds 1 million this year, can the mainnet operate stably? How many validators can the mainnet currently support?

Currently, the client teams state that the mainnet can support approximately 1-2 million validators. The developer community is also exploring related issues, such as the next testnet Holesky, which will have 1 million validators.

11. Will the Ethereum Foundation dissolve? What will be the final outcome of the foundation?

Justin Drake stated that the Ethereum Foundation does not have any income, and some meetings are also non-profit. It does not use the ETH in the treasury for staking and earning income. If the financial resources of the Ethereum Foundation are depleted, funding may come from two sources:

● Public product financing infrastructure within the ecosystem;

● Relatively low Ethereum L1 budget;

12. What is your opinion and suggestion on the current lack of mature technical solutions for cross-rollup transaction execution?

Vitalik believes that the use cases for synchronous cross-rollup transaction execution are not very high. Asynchronous cross-rollup transaction execution is acceptable and has many use cases. Synchronous cross-rollup transaction execution feels more like a profound definition field. If we figure it out, it will definitely improve market efficiency to some extent. Otherwise, we can completely do without it.

13. If the performance of rollups becomes bottlenecked in the future, is it possible for Ethereum’s previous Phase 2 shard to return to the stage?

Justin Drake said that execution shards do not provide more scalability. In addition, the bottleneck of Rollups is data, not execution. In fact, we can think of each rollup network as an execution shard.

As long as the L1 EVM implements SNARKified (Etheruem’s roadmap’s The Verge phase), Ethereum will have an enshrined rollup (a rollup with some kind of consensus integration on L1), and it can be said that Ethereum has an execution shard on the L1 consensus level. Once the arduous work of SNARKifying is completed, in the L1 EVM, making the SNARK verification logic itself public as an EVM opcode becomes relatively easy. This enables an unlimited number of enshrined rollups, and on the Ethereum consensus level, these enshrined rollups are like execution shards of the mainnet, with scalability and the same level of security as the mainnet.

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