Maximizing staking rewards with an ultra-secure, decentralized, DVT (Distributed Validator Technology) solution for ETH staking.
What is SafeStake?
SafeStake is a trust-minimized middle layer for secure, fault-tolerant, and decentralized non-custodial ETH staking.
|In short, SafeStake maximizes staking rewards by securing validators and keeping them online and available to perform their duties to secure the Beacon Chain.|
Staying true to Ethereum’s original ethos, SafeStake is based on the idea of decentralization, benefitting the entire Ethereum ecosystem.
Why are DVT solutions like SafeStake important?
Consider these facts:
- In order to earn staking rewards, Ethereum validators must be online and available to answer calls from the Beacon Chain to sign data (attest).
- Currently, Ethereum validators are limited to running on a single node, prohibiting fault tolerance and presenting a single point of failure.
- Currently, the validator private key is needed to sign data requests from the Beacon Chain so it must be online and available at all times.
- Many large centralized staking-as-a-service (SaaS) providers are contributing to Ethereum’s centralization (and therefore, censorship), actually working against the blockchain’s ethos.
When you think about how these facts combine, it’s easy to see that the current staking environment presents significant issues for stakers, like validator liveliness and private key security, and the entire Ethereum ecosystem, like centralization and censorship.
It should also be noted here that almost all instances of slashing since the inception of the Beacon Chain have occurred when people or staking services attempted to create a fault-tolerant environment for their validators. Since running the same validator private key on two different validator client instances is strictly prohibited at the protocol level, when both validator instances attest at the same time, the Beacon Chain reacted by slashing them from the network. Ouch!
How can SafeStake and DVT help?
SafeStake allows validators to run on multiple nodes, safely and effectively bypassing Ethereum’s protocol limitations.
The protocol divides the validator private key into four shares, then distributes them to multiple nodes managed by independent decentralized operators. This creates a highly decentralized, ultra secure, fault-tolerant environment for Ethereum validators.
With DVT, only three out of four operator nodes need to be online and available to attest on behalf of the validator to create a signature equivalent to that of the original private key. And since the key shares do the work, the original validator private key can be safely stored offline.
Additionally, SafeStake’s proprietary implementation of DKG (Distributed Key Generation) without a ‘trusted dealer,’ combined with the BLS Threshold Signature Scheme and Shamir Secret Sharing, ensure the original key signature or equivalent can never be recreated by any single operator node, preventing malicious behavior and theft.
How does SafeStake work?
To understand how it all works, let’s take a look at what powers the SafeStake protocol and infra.
To begin, SafeStake was written from the ground-up in Rust, and is a trust-minimized middle layer that runs on top of Lighthouse, an open source ETH2 consensus client, also written in Rust.
SafeStake’s foundational framework IS its BLS threshold signature scheme. It utilizes the most advanced cryptography currently available in the blockchain industry along with Hotstuff, a robust BFT library, for operator node consensus.
The protocol employs Shamir Secret Sharing to allow the key shares that are online to produce a signature equivalent to the original (created by the real validator key). It is important to note that the real secret is never shared and the key shares never recreate the original signature for security.
A turnkey ETH staking solution
SafeStake makes running an Ethereum validator easier and less time consuming than setting up and running a solo staking node.
With SafeStake, those wishing to earn staking rewards by running an Ethereum validator can do so without any technical expertise, and they don’t have to monitor their validators 24 hours a day to make sure they’re online and available.
In Stage 1 (the current Galileo incentivized testnet iteration), stakers simply make their 32 ETH deposit to create their validator on the Beacon Chain, then import their validator to the SafeStake network and delegate their staking duties to the four operators they choose, known as an ‘operator committee.’
However, SafeStake is based on the idea of more accessible pooled staking, with the goal of contributing to the decentralization and security of the Ethereum ecosystem by helping to expand the blockchain’s validator base.
With this in mind, we will begin testing Stage 2, where we will introduce a mini-pool architecture that supports 8 ETH deposits after the mainnet launch of Stage 1 source code. Stage 2 significantly lowers the staking threshold and will help expand the validator base by making staking more accessible to those with smaller amounts of ETH.
Stage 2 will also introduce Liquid Staking, allowing users to stake their ETH in the SafeStake ETH pool and receive liquid sfETH tokens in return. The share of the pooled validator’s rewards will be accrued automatically to the user’s sfETH token balance while remaining completely liquid at all times, allowing them the freedom to buy, sell or trade tokens any time.
Our DVT Liquid Staking solution is expected to further expand the Ethereum validator base as stakers will be able to take advantage of the extensive DeFi market to earn compounding returns and ETH staking rewards at the same time.
Security is paramount when considering an ETH staking service. As we have mentioned, SafeStake is written in Rust, a top-tier programming language, and it’s no small thing.
Rust is king when it comes to preventing memory-related bugs and vulnerabilities, and almost always beats Go in runtime benchmarks. With SafeStake’s Rust foundation, efficiency will be the norm when processing large volumes of data and other CPU-intensive operations related to running validators, operator nodes, and interacting with our smart contracts.
Also, consider the penalties validators can face for inactivity/being offline, dishonest validations, or malicious behavior. Missed attestations and block proposals result in missed opportunities to earn staking rewards.
In more serious cases, where malicious behavior or a validator being offline for so long that its balance falls below the required 32 ETH, slashing can result in significant losses of staked ETH and a forceful exit from the Beacon Chain.
To minimize the risk of slashing and other penalties, SafeStake uses HotStuff as the consensus protocol for the operator committees. HotStuff is more robust as compared to the iBFT/qBFT consensus protocol others in the DVT space are utilizing, resulting in higher validator effectiveness rates when three out of four operators attest.
How the Hotstuff protocol works
The SafeStake Ecosystem
There are three major participants in the SafeStake network: Validators, Operators, and the SafeStake DAO. Let’s take a look at each to get a better understanding of their specific roles:
- Validators: SafeStake will feature two types of validators:
- Stage 1: Users with 32 ETH are able to select a group of four operators that will be responsible for carrying out their validator duties.
- Stage 2: Users with 8 ETH ETH can participate in a ‘Pooled Validator’, where they receive sfETH in return for each ETH staked in the SafeStake Liquid Staking pool.
- Operators: SafeStake uses operator committees to perform validator duties on behalf of stakers by coming to consensus. As mentioned, even if one operator in the committee is offline, the other three can still come to consensus to complete the tasks, achieving high availability and fault tolerance. Additionally, the validator private key is split as shares among the operators, so even if some become compromised or act maliciously, the private key remains safe and secure. Similar to validators, the SafeStake architecture presents two types of operators:
- Stage 1: Operators run the threshold signature scheme for the decentralized staking service supporting 32 ETH deposits.
- Stage 2: Operators can be ‘initiators’’ that deposit 8 ETH to create the mini-pool. Initiators will select three other operators to manage their validator with them as part of the operator committee, two of which must be selected from the ParaState DAO.
- SafeStake DAO: The SafeStake DAO is the decentralized organization that has built, maintains, and updates the infrastructure and protocol. The DAO consists of validators, operators, and $DVT token holders and is also responsible for governing the SafeStake network.
The DVT token ($DVT)
$DVT, formerly known as $STATE, is the native token of the SafeStake network, deployed on the Ethereum ERC-20 standard.
$DVT plays a key role in the SafeStake network, performing the following important functions:
Payment Device: Stakers who run a validator on SafeStake will be required to pay a monthly subscription fee in $DVT to their operator committee.
Governance: The ParaState DAO is governed solely by $DVT token holders: Since the ParaState DAO is the entity that governs the SafeStake protocol, all key decisions concerning it will be made exclusively by DAO members.
Security: A minimum balance of $DVT will be a requirement for all operators to successfully register and run an Operator Node on SafeStake mainnet.
Galileo Incentivized Testnet
Currently, we are running Stage 1 of our Galileo Incentivized Testnet, encouraging validators and operators to join the SafeStake network to help test our DVT tech stack at scale.
There’s still plenty of time to get in on the action, earn some great $DVT rewards, and get the chance to win some fantastic ETH prizes as testnet reaches active validator milestones! Click here to learn more and join today!
Stage 1 of the Galileo incentivized testnet is expected to conclude by the end of Q2 2023. The plan is to launch this code base of SafeStake’s DVT staking solution on Ethereum mainnet, with support for 32 ETH deposits, shortly after.
Then, we will launch Stage 2 of the SafeStake incentivized testnet, and introduce a lower 8 ETH staking entry point via staking mini pools and liquid staking functionality.
You can see future plans for SafeStake in the roadmap illustration below from our website:
- SafeStake is a turnkey staking solution for non-technical users.
- It is completely non-custodial – neither SafeStake or the operators on the network ever hold validator private or withdrawal keys.
- Operators and Validators carry out threshold signing under the HotStuff consensus algorithm to minimize the validator’s slashing odds and increase security and validator effectiveness.
- The SafeStake code base written in Rust, which is considered ‘king’ of preventing memory-related bugs and vulnerabilities, and a ‘safer’ programming language by NIST (National Institute for Standards and Technology). Other DVT solutions for ETH2 staking are written in Go or other ‘last-level’ languages.
- It is the first DVT protocol to implement true Distributed Key Generation (DKG) at the protocol level without a ‘trusted dealer’ for the ultimate security.
- Unlike other staking solutions, SafeStake does not need to rely on an oracle to monitor the network operators to ensure they don’t front-run transactions and steal ETH rewards.
- SafeStake’s architecture is streamlined to offer a more robust and secure solution for Ethereum 2.0 staking, allowing the validation flow to happen in a few simple steps.
SafeStake’s mission is to maximize staking rewards for Ethereum validators while contributing to the increased decentralization and security of this amazing PoS blockchain.
SafeStake is one of the first protocols to use Distributed Validator Technology (DVT) for ETH2 Staking, giving power back to users via decentralized technology.
The core focus of SafeStake is to make staking more accessible, secure, reliable, and decentralized. In the next stages of the Galileo incentivized testnet, we will lower the minimum threshold required to participate in ETH staking from 32 ETH to 8 ETH (Stage 2), and eventually as low as .01 ETH (Stage 3). These following stages will also introduce staking pool and liquid staking functionality to SafeStake.
Developed and supported by a multinational team and maintained by a decentralized DAO, SafeStake strives to proudly represent the spirit of decentralization and non-custodial staking.
The protocol encourages the use of its decentralized framework by offering a Staking as a Service (SaaS) infrastructure for different users and entities interested in taking part in earning ETH2 staking rewards. Users need not have technical knowledge about staking to participate.
We are excited for what the future holds and hope you will follow SafeStake as our team continues to develop and build the product to be the most solid DVT staking solution in the space.
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