Decentralized ETH staking network SSV.network launched its mainnet last Thursday, September 14. The newly-launched mainnet is meant to provide infrastructure for those who want to run an Ethereum (ETH-USD) validator using a Distributed Validator Technology Network, or DVT Network. Following the Ethereum Merge that took place last year, DVT has emerged as an inclusive solution to the notoriously complex staking process.
Distributed Validator Technology (DVT) has received considerable attention in recent months and is touted as a way to increase validator participation while remaining true to the decentralized ethos of blockchain technology. As one of the original pioneers in DVT, SSV.network’s mainnet launch allows multiple node operators to participate in community staking via partner applications, with reported plans to facilitate solo staking as part of the final permissionless phase.
A New Development in Ethereum Staking Post-Merge
The Ethereum Merge, or network upgrade, which kicked off on September 6th, 2022, was considered a major leap forward for the blockchain industry. The Ethereum network transitioned from a proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) consensus, reducing the network’s energy consumption and lowering the technical barriers to entry.
Despite the Ethereum Merge marking a considerable milestone in improving and scaling the Ethereum network, financial barriers to participation still persist, and for many, ETH staking has remained out of reach.
The new development in Ethereum staking, DVT, allows Ethereum proof-of-stake (PoS) validators to be run across multiple nodes operated by a group acting as a single validator and governed by smart contracts. In simple terms, this means that multiple contributors can participate in staking without the reliance on centralized intermediaries or the financial entry requirement of 32 ETH. This also serves to make the Ethereum network more robust and secure.
Centralized Models Versus Self-Custody
In the recent announcement by SSV.network, Alon Muroch, Protocol Lead at SSV, shared the company’s goal “to onboard even more users who would be otherwise wary of trusting single entities,” adding, “In one stroke, DVTs can alleviate all of the staking centralization concerns we’ve heard in recent years.”
Within the blockchain industry, there have been increasing fears over the domination of centralized staking platforms, such as Binance (BNB-USD), Coinbase (NASDAQ:COIN), and Kraken, who hold a significant portion of the staked ETH supply.
As centralized staking platforms inherently hold custodial control, the development of self-custody via decentralized models reduces network risks such as security breaches, potential mismanagement of funds, as well as other malicious activities. Unfortunately, investors are often all too familiar with the recent hacks that the cryptocurrency industry has experienced in recent years.
Key to the decentralized approach of SSV.network is its Secret Shared Validator (SSV) technology. This encourages global adoption by providing an open infrastructure for anyone who wants to run an Ethereum validator, including individual users, staking pools, and institutional staking services.
As a recipient of an EF grant in 2021 and having collaborated with the Ethereum Foundation to develop the DVT network, SSV.network is a leader in the field of DVT, being the first to build and launch this system.
According to the announcement, the mainnet launch is supported by over 10 dApp partners, including Stader, Ankr, Stakestar, 01node, Metapool, and StakeTogether, who will deploy their staking dApps on the network. The release also states that 40 SSV DAO grantees will go live on the network following the launch.
Supported by prominent dApp partners and endorsed by the Ethereum Foundation, SSV.network’s advancements in DVT mark a crucial step in making blockchain technology accessible to all while upholding the core principles of decentralization.
With Ethereum staking undergoing a transformative moment, developments in DVT not only democratize the staking process but also strengthen the security and resilience of the Ethereum network. The shift from centralized to decentralized staking platforms, advocated by SSV, reflects the ongoing technical development in the space as well as the demand for self-custody in the blockchain industry.
