Lido Finance will expand the number of validators to increase the decentralization of Beacon Chain

Lido Finance will expand the number of validators to increase the decentralization of Beacon Chain

Stayking service Lido Finance will introduce the technology of distributed validators.

Lido Will Adopt Distributed Validator Technology and Start Researching Allow Allow Allow to Become in Lidhout Permisional and Empower Steth Holders Teters Teters ToTH. https: // t.CO/JQYVYRX29W

– Wu Blockchain (@wublockchain) April 15, 2022

There are also plans to develop a scoring system that will allow anyone to become a validator in LIDO without permission.

The initiative is implemented as part of a mission to reduce barriers to Ethereum 2 stake.0, as well as an increase in the degree of decentralization and security of the network.

According to Dune Analytics, over the past 30 days, 75% of the new participants have been provided by Lido Finance service. Such dynamics caused fears in the growth of its centralization.

The project involves 21 validator. The share of each is less than 2% of the total coins in stakeing. Lido Finance intends to reduce this figure to 1%.

The list of validators is constantly updated by experts to minimize risks for users.

As criteria are:

  • diversification on geography and jurisdictions;
  • lack of physical and legal communication between validators;
  • the use of their own GCDs;
  • distribution between own and cloud infrastructure;
  • introduction of the best industry practices in the field of safety and key management;
  • direct dependence between the financial results of operators and the popularity of the service;
  • long -term compliance with the success of Ethereum and decentralized economy.

A similar approach is not devoid of shortcomings and is perceived as a temporary measure. Lido Finance intends to improve it by reducing the barriers for NOD operators and creating incentives for encouraging “good behavior” and minimizing risks for management.

The technology of distributed validators will combine the latter into independent committees. Structures will begin to jointly propose and confirm the blocks, which will significantly reduce the risk of ineffective or incorrect behavior of one of the participants.

The step will allow you to connect to the service of those validators that are now perceived as “unreliable”. They will directly contribute to the decentralization of the group, without creating a risk to Lido or Ethereum participants.

The second improvement is to create an assessment of the Noda operator composed of a number of metrics. The resulting indicator will affect the distribution of remuneration.

The introduction of this innovation will move away from the current binary approach (trusted and unreliable providers), as well as help improve their performance.

The project intends to improve management within the framework of the Tao. In particular, the introduction of new mechanisms is supposed to prevent unauthorized changes in LIDO. Among them are temporary blocking and granting the right to the quorum of STETH owners.

According to Defi Llama, LIDO from TVL $ 10.2 billion, it takes the fourth line among Defi Protokols based on Ethereum. Over the past month, the indicator has grown by 40.3%, while in an ecosystem as a whole – by 8.5%.

Recall Andreessen Horowitz investigated $ 70 million in Lido Finance.

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