Lido is always at the brink of innovation, trying to improve the experience of staking as much as possible. A technology that we think has a lot of potential for our ETH 2.0 operation is SSV (Secret Shared Validators).
Lido currently has over 600K ETH staked on the beacon chain, with every validator (32 ETH) being operated by a single node operator. While the
Lido DAO only picks top-notch node operators, we would like to move to a setup where there is no single point of failure. With SSVs implemented, one Lido validator would require a majority of Lido node operators to produce valid attestations or block proposals rather than on a single node operator. This further reduces slashing risks and also improves uptime. If one node operator goes down, the others can continue to sign messages together and keep the validator online. We see this as a major improvement of our resilience and believe it will strengthen the trust in Lido even more. If you would like to learn more about SSVs, check out this Medium post by Mara Schmiedt: Secret Shared Validators on Eth2. Bringing better validator resiliency to… | by Mara Schmiedt | Coinmonks | Medium
SSVs are still under active development and in our opinion not ready yet for production. Both Blox Staking and Obol are actively working on and researching SSVs for their own protocols. Having multiple teams working on different implementations of this technology is a good thing - the same as having a variety of ETH 2.0 node clients and diversity in staking setups between node operators. For now, Lido would like to stay agnostic of both these protocols, but we would like to support both teams’ efforts with a grant as we think it is highly useful to the DAO.
Therefore, the LEGO council would like to commit $100k in LDO token to both protocols, Blox Staking and Obol. As per LEGO rules, this requires a DAO vote which will be initiated shortly. We see this as a long-term commitment and are hoping to have a production-ready solution in place for use after the full transition to ETH 2.0 is complete.