DVT and how it helps keep ethereum staking decentralized and censorship resistant

Test. Hello everyone. Glad to be here. My name is Ariel from the SSV network and I am very excited to be with you today. Let's start by making a little noise if you've already heard of the term DVT.

I hope there will be many more after this one . At SSV network, we are developing distributed validator technology, also known as DVT. Our grand vision is to help decentralize Ethereum with the deep conviction that Ethereum's security should be in the hands of as many people, entities, or node operators as possible, without relying on any one of them. And I think this concept prepares the ground well for understanding exactly what DVT allows, but I would first like to start with the question: why do we need it? Looking at the current state of Ethereum, it is clear that the centralization of staking is a major problem and a risk factor.

A few entities control the majority of the stake, which is very problematic not only because of the volume they manage, but also because the larger they are, the higher the systemic risk to the Ethereum ecosystem, which concerns us all. Furthermore, isolated entities are more vulnerable to censorship and regulatory risks. I think we all witnessed, a few weeks ago, the SEC's crackdown on Kraken's staking program. And because of economies of scale in staking, there are not enough incentives for large providers to distribute their infrastructure, which hurts customer diversity and contributes to single points of failure. So, what is DVT and how does it help us move towards a more decentralized Ethereum?

Distributed validator technology is a new technological primitive in the Ethereum stack that allows multiple non-trusting parties to collaboratively manage an Ethereum validator . It works by dividing a validator key into several parts, distributed to operators within what we call a cluster, or validator cluster. Each operator in this cluster owns a share of the complete key. When a task arrives, they each sign it partially. They then aggregate the signatures to reconstruct a complete and valid task to broadcast on the beacon chain.

Each operator in the cluster owns a share without being able to reconstruct the complete key by themselves. This means you no longer need to keep your signing key in an active wallet. Place it in cold storage. Follow best practices for key management. This essentially means that it's much more secure.

These operators can also work with different configurations, right? Like different customers, different hardware, different data centers, or different cloud providers. This allows you to attract a wider variety of customers. And because we use a threshold signature and a consensus protocol, fault tolerance is built into the system. Therefore, if an operator were to be offline, it would not affect the overall performance of the validator.

As long as the threshold is reached, it continues to function normally, which makes it much more resilient. That being said, the advantages of DVT are quite considerable. This change in the way validators operate significantly increases network availability and security, while significantly reducing the risks of slashing, unavailability, and centralization compared to traditional validator configurations. By improving the resilience of Ethereum's validators and consensus layer, we are helping to make Ethereum a more decentralized and secure network for all of us. So, what can you do with that?

Because after all, it is infrastructure, and infrastructure is meant to be used in some way used in some way . Therefore, you can create excellent staking pools or liquid staking pools using DVT. You can get greater participation from operators, which means the risk is shared among more people. This also allows for better performance, resulting in more optimized rewards. In the future, institutions and staking providers will be able to use DVT to decentralize their infrastructure and mitigate the risks associated with high-volume configurations, while reducing operational costs because you can run more validators on the same configurations.

Stakers wishing to do solo staking can take advantage of DVT to access the performance of experienced and reputable operators. They can choose to entrust the management of their validators to them without having to manage their own infrastructure, which is a major obstacle, while retaining full custody of their funds. Finally, and no less importantly, DAOs, groups, and communities can unite to manage their own validators securely and with minimal trust. Now that we know about DVT, let's get back to SSV. SSV is not a mainstream staking application.

It is a DVT infrastructure provider designed to build high- performance, secure, decentralized staking applications on Ethereum. The way we decided to implement DVT at SSV is through a multi-cluster DVT network, because we assume that a more secure Ethereum is a multi-cluster Ethereum. We foresee a future Ethereum with a long tail of diverse and innovative staking applications. These staking applications will not all use the same operators. They will have different sets of operators, many cluster variants, and to support this future, we have built the DVT as a network.

And we did it by adding two more essential components . Firstly, a robust pub/sub peer-to-peer network, but we also added a layer of smart contracts for coordination. Why did we proceed this way, or what are the advantages of doing it in the form of a network? Well, in SSV, operators and stakers can join the network at any time without permission via a smart contract call. Using smart contracts means that no coordination is needed if you need to manage your validator, leave the network, or change your set of operators, for example for reasons of competitiveness or performance.

Furthermore, being a network allows participants to benefit from network effects, doesn't it? Thus network effects, doesn't it? Thus , any tool developed for a specific cluster can benefit the entire ecosystem. And I think that this significantly reduces development costs at all levels. Opting for a network approach rather than an isolated one also offers greater transparency, doesn't it?

As a network, you can see the performance of your operators at the validator level, not just the cluster level, which allows us to better choose who manages our operators. And the best for last is a usable infrastructure. This means you can reuse the same network, configurations, and carriers, and the cost of SSV integration is virtually zero. It's literally a smart contract call, and I find that quite incredible. Because building an infrastructure for staking is very difficult.

It's very complex. This requires a lot of expertise and resources. Now that this infrastructure is available as a service, teams building on SSV can focus on their business and application, rather than the underlying infrastructure. This means that for the teams that will build the next Rocket Pool, it will take 3 months instead of 3 years. And we know this from experience because we already have teams that build exactly that within those timeframes.

So, a quick word about where we are now and where we come from? SSV began about 2 years ago when we received a grant from the Ethereum Foundation to develop an SSV node, which was later called DVT. We then formed the SSV DAO. It is very important for us to be community-oriented, transparent, to involve many people, and to have levers of control and balance for a protocol of this scale. We have integrated over 40 different contributors from around the world who share our passion for staking and decentralization.

And over the past 18 months, we have been operating on a testnet, with the participation of more than 3,000 operators, 100 of whom are verified operators. By this, I am referring to reputable and experienced staking providers . Some of them are among the largest in the sector and are experimenting with this technology with the intention of adopting it in the future. They are currently operating an SSV node on the testnet that you can choose and try today. We have also accumulated more than 20,000 validators.

It was important for us not only to see that it works on a large scale, but also that it works as well as, or even better than, current benchmarks. And I am very happy to say that this is the case. Furthermore, during all this time, we have also focused heavily on building a very healthy and dynamic ecosystem around our protocol. Whether they are leading staking providers, strategic partners, or staking applications. And as you can see behind me, we already have more than 25 different teams developing applications dedicated to using DVT and SSV as infrastructure, which really shows that the state of Ethereum, which I talked about at the beginning of my speech, will be very different in the future.

Now, I would like to take this opportunity to call on all developers present here to check out our funding programs check out our funding programs . We recently launched a $ 50 million grant ecosystem fund to support teams building DVT-based applications. So, if you are interested in staking, if you are a serious team and you know how to execute, contact us. We would be delighted to collaborate with you. I personally think that with the Shanghai update fast approaching, there has never been a better time to take advantage of it and get into staking.

That said, uh, what do we do next? As I said, this project has been in development for 2 years. We are currently in the final stages of completing our V3 testnet, which is scheduled to launch in April. The V3 testnet is our release candidate and, with scheduled and ongoing audits, I can confidently say that the DVT will reach the mainnet this year, and even sooner than you might imagine. So, keep an eye on our progress.

If you want to know more about us, please visit our website. Marco, from our team, will be giving a presentation later today on DVT and liquid staking pools. Very interesting. Come and see it. Also, if you have any questions or would like to discuss, we have a booth in the Dow section throughout the conference.

My team and I will also be outside to answer all your questions. Thank you for listening and have fun this week. Bye.