Staking services company ssv.network is today releasing a blockchain it says will help decentralize staking for Ethereum and other blockchains to counter concerns the process is dominated by a few large participants.
The SSV mainnet is the largest implementation of a staking network that uses a Distributed Validator Technology (DVT) Network, the developers said.
The launch comes as staking, the process used to secure the Ethereum blockchain, is run largely by centralized staking providers, which together hold more than 70% of the staked ether (ETH) supply. These include a number of centralized exchanges such as Binance, Coinbase, Kraken holding just about 18% of the total staked ETH. Liquid staking providers such as Lido, RocketPool, Stader and Stakewise account for more 36% – with Lido accounting for the lion’s share.
Both liquid and exchange-based staking are fundamentally centralized and custodial, though protocols may include multiple separate operators. That concentration has sparked concerns in the broader crypto community
“Together with the partners and the community, SSV Network can usher in a new paradigm for Ethereum staking,” Alon Muroch, protocol lead at ssv.network, said in a message to CoinDesk. “Our goal is to onboard even more users who would be otherwise wary of trusting single entities, while not wanting to go through the relatively complex process of staking independently.”
“Together with the partners and the community, SSV Network can usher in a new paradigm for Ethereum staking,” Alon Muroch, protocol lead at ssv.network, said in a message to CoinDesk. “Our goal is to onboard even more users who would be otherwise wary of trusting single entities, while not wanting to go through the relatively complex process of staking independently.”
SSV circumvents centralization concerns by allowing the sharing of a validator – an on-chain entity controlling 32 ETH via a network – with multiple underlying operators responsible for creating blocks, the data sets that comprise the blockchain. The company built the system in collaboration with the Ethereum Foundation (EF) after more than two years of intense research and development, kickstarted by an EF grant in early 2021.
Each validator is controlled by a rotating set of registered operators, a process that requires no external coordination and is governed by SSV smart contracts. In contrast, current staking providers operate as single entities that pool tokens from their users.
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SSV’s mainnet launch will see more than 10 teams deploying their staking dapps on the network. The initial ones will include Stader, Ankr, Stakestar, 01node, Metapool, StakeTogether, XHash, Chainup, Coindelta and Claystack.
Edited by Sheldon Reback.
