Lido Validator Exits Policy (Draft for Discussion)

[Izzy]

As a part of the implementation of withdrawls and unstaking for users of stETH, it seems that the Lido DAO will need to come up with a policy on what the expectations and responsibilities of Node Operators who participate in the protocol by operating validators are.

Together with some other Lido contributors, we have put together a draft attempt at such a policy, to be used as a driver for discussion by the community.

The full document can be found here: Lido on Ethereum Validator Exits Policy - HackMD

I suggest that we take the next two weeks to discuss and iterate on the above and attempt to have a vote-ready document within the first week of March. It would also make sense to have a deep-dive session to go over how the policy would interact with the proposed updates to the oracle design and the withdrawals flow, so we will try to put something together. Aiming for first week of March should also provide Lido contributors and Node Operators enough time to test the implementation of relevant process/mechanisms when withdrawals are enabled on the Goerli testnet.

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Other topics / resources relevant to this discussion:

Withdrawals for Lido on Ethereum

The Shanghai/Capella upgrade for Ethereum, scheduled for March-April 2023, will introduce support for the unstaking of Ether. The ability to exit a validator and unstake associated Ether is required for the Lido protocol to build the withdrawals feature. Designing the withdrawal feature for the Lido liquid staking protocol is a complex task due to the difficulty of interfacing data between the Consensus and Execution Layers, as well as the async nature of the Consensus Layer validator exit and …

Withdrawals: Automating Lido Validator Exits

Intro After withdrawals are live on Ethereum, special tooling setup will be required to effectively manage exits for 100+ thousands of Lido validators. We propose a semi-automatic solution which requires Node Operators to pre-sign exit messages and run a dedicated daemon which will broadcast the messages to the network when Lido Oracles publish exit requests on chain in LidoOracle events. Problem Statement Ethereum validator exits are going to be voluntary: there is currently no way for Lido…

Withdrawals. On validator exiting order

TL; DR This post describes the current background behind validator exiting order design. We, Lido dev team, want to provoke public discussion and gather feedback and stakeholders’ sentiment; especially looking forward to hearing from Node Operators representatives. The current dev team preference is Approach 1: eject first the validator from a Node Operator with the largest amount of active validators. Intro When withdrawals in Ethereum become feasible Lido stakers will be able to withdraw E…

[Izzy]

There will be an open community session to discuss the draft on Wed Feb 22, 5PM UTC. Since posting a public zoom link isn’t ideal, if anyone is interested in joining please respond here, or ping someone from the NOM contributors in the Lido discord and the link will be shared.

[Izzy]

Just a reminder that there’s an open deep dive session today at 5PM UTC to go over the proposed policy and go in-depth on the tooling modules that were presented yesterday by the tooling team during the community call (relevant segment is here: Node Operator Community Call #4 - YouTube)

If you wish to join please contact a lido contributor and the zoom link will be provided!

EDIT:
Recordings of the sessions available here:
Session #1 Lido validator exits & oracle deep-dive session 1.mp4 - Google Drive
Session #2 Lido validator exits & oracle deep-dive session 2.mp4 - Google Drive

[spireblockchain]

Thanks for posting the session recordings. I wasn’t able to attend the original deep dive sessions so this is helpful.