Last key milestone in Ethereum’s current era achieved with ‘Distributed Validator Technology’.

Decentralization is a fundamental principle of the blockchain philosophy, and Ethereum developers are now focusing on a new design feature that could take this principle to the next level.

The aim is to implement “distributed validator technology,” or DVT. The Ethereum blockchain relies on 606,947 validators to confirm transactions made on the network, according to BeaconScan. However, each validator can be considered a point of failure in itself.

In addition, validators can be subject to significant financial penalties known as “slashing” if they go offline for extended periods. So validators have an incentive to increase their own resilience.

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The idea is that validators can become decentralized themselves.

Ethereum co-founder Vitalik Buterin has listed distributed validators among the blockchain’s top priorities since at least 2021, when he wished the Beacon Chain a happy birthday and provided an updated roadmap for the second largest blockchain by market capitalization, notable for its smart contracts.

DVT has garnered more discussion and development focus in recent months among entrepreneurs and crypto analysts at firms including Messari, Coin Metrics, Bankless, Wu Blockchain, and Pantera Capital.

Under DVT, a validator’s private key, used to sign on-chain operations like block proposals and attestations, can be split across several node operators. As a result, the duties and responsibilities of a validator can be distributed and shared across a cluster of node operators, instead of a single node.

Distributed validator technology “allows you to have multiple parties running a single validator,” said staking service provider P2P’s head of Research Steven Quinn to blockchain. “From a technical perspective, what that means is you can geographically distribute the machines.”

The 2021 roadmap, while not entirely complete, shows Ethereum’s trajectory of where it’s been and where it’s going, delineating different eras of current and future development.

Currently, Ethereum is still in the first era, titled “The Merge,” even though Ethereum has successfully shifted to a proof-of-stake consensus mechanism, completely overhauling its system for processing transactions.

What remains among the key milestones in the current era is the deployment of distributed validators, which is on its way thanks to two open-source networks: Obol and SSV.

Obol Network is “responsible for fostering the adoption of multi-operator validation as a use case for Distributed Validator Technology,” as stated on its homepage, and SSV.Network “enables the distributed operation of an Ethereum validator across varying operators,” according to a blog post.

Currently, each Ethereum validator runs on a single node, and both Obol and SSV see this as a single point of failure in the validation process. If a node operator goes offline and becomes unavailable for any reason, such as an infrastructure bug in the validator’s client, then the validator wouldn’t be able to conduct its responsibilities, such as proposing blocks and attesting.

As a result, the validator would incur a slashing penalty for their staked ether. Obol and SSV are attempting to remove this single point of failure in the validation process.

Regarding DVT, Messari research analyst Stephanie Dunbar told blockchain, “What I’m most excited about is the idea of increasing resiliency on Ethereum and in the future, potentially on other blockchains as well.”

DVT’s importance lies in making the Ethereum blockchain more resilient, defined as Ethereum being able to “withstand external and internal disturbances – this can be from geopolitics, regulation, markets, or even less intuitive disruptions like fires or earthquakes,” said Walter Smith from technology-driven investment firm Galaxy to blockchain over email.

With more clients and node operators in different geographical areas running a single validator, even if several node operators experience downtime as a result of a malicious actor or a bug in the codebase, the entire validator would not go down since a significant portion of the network is using distributed validator technology.

“Should <33% of the participating nodes in a DV cluster go offline, the remaining active nodes can still come to consensus on what to sign and can produce valid signatures for their staking duties,” according to Obol docs.

Distributed validator technology represents the last critical development in Ethereum’s Merge era before “The Surge,” as Obol and SSV have been gearing up to bring distributed validators to Ethereum mainnet.

SSV is currently in the final stage before launching its mainnet. In March, the public testnet Jato was introduced, and in April, Obol began deploying distributed validators on the Ethereum mainnet. DVT will make the heart of the crypto universe – Ethereum – more robust, more decentralized, and more credibly neutral. This will open its protocols and uses to everyone in a more stable way,” said Smith.

Edited by Bradley Keoun.

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