SafeStake

When it comes to Ethereum, the only constant is change. The migration from Proof-of-Work (PoW) mining to Proof-of-Stake (PoS) consensus and the Shapella upgrade that enabled withdrawals has created a tsunami of interest in Ethereum’s existing and potential use cases and a general push for more mainstream adoption.Why? Ethereum offers extremely high levels of network security backed by billions of dollars in staked funds, along with a broad, decentralized, and highly dedicated community and robust infrastructure.In short, unlike so many other cryptocurrencies, Ethereum is so much more than just a token:<ol><li>Ethereum is a highly functional and secure blockchain network with the potential to give the largest global payment processing giants, like J.P. Morgan Chase, Fiserv, and Wells Fargo, serious competition.</li><li>Significant advantages taking shape on the horizon will offer lightning-fast low-cost transactions and decentralized security via distributed validators will advance adoption at all levels.</li><li>Ethereum is the foundation and future of Web3, where decentralized apps (Dapps), decentralized finance (DeFi), and decentralized autonomous organizations (DAOs) are already becoming the new norm.</li><li>This list could likely go on and on. So, let’s pause and reflect on the accomplishments thus far while eagerly anticipating the promising future ahead.</li></ol>In the dynamic landscapes of 2022/23, Ethereum has witnessed a wave of remarkable innovations and exciting prospects. Among these groundbreaking advancements, Distributed Validator Technology (DVT) emerges as a game-changing development that is set to redefine how validators secure Ethereum’s Beacon Chain.As DVT draws closer to becoming a reality for all stakers, it promises to revolutionize the validation process, ushering in a new era of enhanced security, fault tolerance, and decentralization for the entire Ethereum ecosystem. The future holds immense potential and opportunities for Ethereum staking, with DVT at the forefront of this transformative journey.<h3 id="what-is-dvt">What is DVT?</h3>Distributed Validator Technology is essentially exactly what its name says it is. With DVT, Ethereum validators run on several decentralized nodes instead of on single nodes.DVT offers Ethereum validators what is not possible at the Ethereum protocol level — redundancy, fault tolerance, private key security, and decentralization.The benefits of DVT are several, including: maximized staking rewards, minimized slashing risks and penalties for being offline, higher levels of private key security, and overall decentralization, which promotes censorship resistance.<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/2f3a7bd77786431c857d47892c54ca0f.png" /><h3 id="what-is-safestake">What is SafeStake?</h3>If DVT is the tech, SafeStake is the tech stack, offering the first DVT protocol and infrastructure written in Rust and using HotStuff consensus for increased validator performance, security, and reliability.In Stage 2, the non-custodial SafeStake protocol will incorporate liquid staking pool functionality, where operators known as ‘initiators’ can make 2 ETH deposits to create mini-pools. The mini-pool will collect the remaining 30 ETH from other users depositing as little as 0.1 ETH each.Like most other liquid staking pools, all staking deposits happening in SafeStake Stage 2 will receive 1:1 SafeStake liquid staking tokens (LSTs) that always retain their liquidity. These tokens can be used to earn compounding interest on other DeFi platforms or sold/swapped at any time.<h3 id="a-trusted-setup-for-the-validator-private-key">A Trusted Setup for the Validator Private Key</h3>SafeStake is poised to become a key player in the emerging DVT sector thanks to the unique approach taken by our development team regarding the use of Multi-Party Computation (MPC) in the threshold signature scheme together with the Distributed Key Generation (DKG) function.<h3 id="mpc-multi-party-computation">MPC (Multi-Party Computation)</h3>Multi-Party Computation (MPC) is a powerful cryptographic technique that enables multiple parties to collaborate and compute a function on their private data without revealing that data to each other.<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/b2e0e6ec24614eccae57e0eccccae594.png" />Implementing MPC can be challenging, as it requires a high degree of coordination and trust among the participants. For this reason, the SafeStake technical team has written the protocol with a trust setup based on a threshold signature scheme using Distributed Key Generation (DKG) without a trusted dealer.SafeStake employs a multi-party threshold calculation scheme that works by allowing each participant in the private key generation ceremony to perform the relevant calculations while preserving the encryption. In this construct, each node separately contributes to signing the collective message without the need to relay the encrypted content or that of the other participants in the network.<h3 id="dkg-distributed-key-generation">DKG (Distributed Key Generation)</h3>It is important to note that SafeStake’s DKG functionality is one of the key features that differentiates it from other solutions that use share exchanges, as our implementation of DKG avoids depending on a trusted party that generates, knows, and distributes the secret.In a SafeStake DKG ceremony, participants contribute to the key pair generation and secret share distribution process by means of MPC so that no party can discover the shared secret.Instead, the SafeStake protocol facilitates each participant sending a share to the DKG function which creates the public/private key pair. Then it delivers the public key to all parties and splits the private key into secret shares, with each participant receiving a share back.In this way, SafeStake maintains a non-interactive threshold signature system with proactive security that requires a minimum number of participants (the threshold) to be able to use or reveal the generated secret key. This prevents users, operators, and malicious actors from accessing or recreating the validator’s private key or an equivalent data signature of the original.As an added measure of security, thanks to SafeStake’s proactive secret sharing, the key shares can be renewed periodically without changing the secret. When shares are renewed, any information gained by an attacker that might help them reveal the secret and compromise the private key becomes useless.<h3 id="avoiding-incorrect-shares-with-hotstuff-consensus">Avoiding Incorrect Shares with HotStuff Consensus</h3>DVT is more complex than it may sound or appear at first glance. Splitting private keys into shares to offer validators a more decentralized, fault-tolerant, and secure environment isn’t without certain risks. In some cases, some participants may receive incorrect shares, rendering their participation invalid.To avoid this potential issue, SafeStake utilizes the HotStuff consensus protocol. HotStuff is the first partially-synchronous BFT replication protocol and SafeStake uses it to govern the operator network and determine the message content of the threshold signature scheme between operator nodes.HotStuff ensures that operators do not receive any incorrect shares and remain online as long as possible to attest, minimizing penalties and slashing risks.<h3 id="safestake-a-unique-architecture">SafeStake: A Unique Architecture</h3>The developers at SafeStake worked for more than a year to apply the most advanced and innovative threshold signature cryptography to the protocol, effectively eliminating the single points of failure associated with most distributed systems.With a highly functional threshold signature scheme, SafeStake ensures that the minimum number of nodes needed to attest on behalf of a validator are always available and that the honest actors are always part of the majority. Simply put, if one or two nodes are offline or compromised by a malicious actor, the other nodes will continue attesting safely and effectively for the validators.<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/e3bdc16a9ece4769a05c750a4550a0a8.png" />The above flowchart illustrates the validator registration process in SafeStake Stage 2, where mini-pools created by 2 ETH deposits and filled by other deposits as low as 0.1 ETH will attract more users that want to earn staking rewards with smaller amounts of ETH.Additionally, the use of the first partially synchronous BFT replication protocol (HotStuff) combined with our proactive threshold signature scheme without a trusted dealer and the robustness of smart contracts written in Rust make SafeStake stand out from the other DVT platforms and protocols.<h3 id="final-thoughts">Final Thoughts</h3>As we look into the future of Ethereum, it becomes evident that the blockchain is undergoing a remarkable evolution, brimming with new and exciting technologies. These advancements hold the promise of revolutionizing Ethereum’s scalability, usability, and overall performance. The blockchain ecosystem is embracing these cutting-edge solutions, which will undoubtedly lead to transformative changes across various industries.Moreover, ongoing research and development efforts have resulted in ingenious Layer-2 technologies, which are set to tackle Ethereum’s scalability challenges head-on. By moving certain operations off-chain while still maintaining security through smart contract interactions, Layer-2 solutions offer the potential for faster, less expensive transactions, helping to scale Ethereum for mass adoption and widespread usage.Additionally, advancements in decentralized finance (DeFi) applications are making financial services more accessible and inclusive. Smart contracts are automating complex financial processes, enabling secure lending, borrowing, and asset management without intermediaries. As these DeFi protocols continue to mature and become more user-friendly, they will open up new opportunities for people worldwide to participate in the global financial system, regardless of their background or location.In the future, the integration of privacy-preserving technologies like Zero-Knowledge Proofs and secure Multi-Party Computation (MPC) will add a new layer of confidentiality and data protection to Ethereum’s functionalities. This will encourage the development of privacy-conscious applications and foster greater trust among users, attracting even more mainstream interest and adoption.As these innovative technologies and improvements take root and become fully integrated into the Ethereum ecosystem, we can expect to witness a proliferation of diverse and practical use cases across industries, ranging from supply chain management, gaming, digital identity, healthcare, and more. The expansion of these use cases will, in turn, drive greater demand for Ethereum.Ethereum’s ongoing evolution and the emergence of revolutionary technologies have set the stage for a transformative future. The blockchain’s enhanced scalability, usability, and performance will undoubtedly expand its utility and application, propelling Ethereum into the forefront of the global digital landscape. As this momentum continues to build, Ethereum is poised to reshape industries and pave the way for a more decentralized, accessible, and inclusive world.SafeStake is contributing to Ethereum’s security and decentralization with an innovative and forward-thinking approach. Incorporating Multi-Party Computation (MPC) in the threshold signature scheme along with the Distributed Key Generation (DKG) function, has laid the foundation for the highest level of validator private key security, and sets SafeStake apart from other DVT solutions.The team’s unwavering commitment to security and innovation positions SafeStake to play a pivotal role in shaping the future of decentralized validation. End.... About SafeStakeSafeStake is a pioneering technology company focused on revolutionizing Ethereum staking. With its cutting-edge, decentralized Distributed Validator Technology (DVT), SafeStake provides an ultra-secure, fault-tolerant environment for Ethereum validators, maximizing staking rewards and minimizing penalties. SafeStake is committed to driving the growth and innovation of the Ethereum network while ensuring the security and prosperity of its participants.<a href="https://www.safestake.xyz/" rel="noopener noreferrer nofollow">Website</a> | <a href="https://medium.com/ethereum-on-steroids" rel="noopener noreferrer nofollow">Blog</a> | <a href="https://twitter.com/SafeStakeDVT" rel="noopener noreferrer nofollow">Twitter</a> | <a href="https://t.me/ParaState" rel="noopener noreferrer nofollow">Telegram</a> | <a href="https://discord.com/invite/zFS3Mnfpwj" rel="noopener noreferrer nofollow">Discord</a> | <a href="https://github.com/ParaState" rel="noopener noreferrer nofollow">Github</a>

Combining MPC and DKG for Unparalleled Private Key Security

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SafeStake

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