The below is a summary for purposes of pointing the upcoming snapshot vote to.
Incident Summary
On April 13, 2023, 11 validators operated by RockLogic GmbH were slashed due to the duplication of validator keys in two different active clusters, causing a double vote.
Lido DAO contributors alerted the RockLogic team to the slashings and RockLogic subsequently brought the affected cluster offline to mitigate potential further risk. The root cause was identified by the RockLogic team and the remaining validators were steadily brought back online.
The estimated impact on stETH holders, from the time of the incident until the validators fully exit and are automatically withdrawn from the network on May 20th, is estimated to be ~13.77 ETH.
For more detail regarding the incident’s root cause, timeline, impact, and response, please see the Lido post mortem and RockLogic post mortem.
Staker Compensation
On April 19, 2023, RockLogic GmbH requested that the Lido DAO utilize the slashing cover fund to provide compensation to stakers (more detail regarding the cover fund).
The actual amount of compensation will be determined following the full exit and withdrawal of the 11 validators from the network, but has been estimated to be close to ~13.77 ETH.
Next Steps
If there’s no objections, I propose that a snapshot vote commence on Apr 20 (and run until Apr 27th). DAO participants will vote whether the slashing cover fund should be utilized to source compensation for this incident.
If the snapshot vote passes, an on-chain Aragon vote will be held after May 20th (the date the validators will be withdrawn) to proceed with on-chain execution in order to compensate stETH holders via usage of the slashing cover fund.
Lido DAO and community members are encouraged to voice their opinions regarding this matter in this thread.