The following article is a summary of a recent ETHResearch contribution by Chorus One Research, which describes a bug we've encountered in mev-boost, the standard software validators used to solicit blocks from sophisticated, specialized entitites called builders on Ethereum. This bug is not specific to Chorus One; it can affect all Ethereum validators running mev-boost.
To read the full paper, please visit: https://chorus.one/reports-research/mev-boost-withdrawal-bug
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Chorus One runs a proprietary version of mev-boost, dubbed Adagio, which optimizes for mev capture by optimizing latency. Our commitment to Adagio obligates us to have an in-depth understanding of mev-boost and Ethereum's PBS setup in general. As such, we decided to dive deeper, and to make our findings available to the Ethereum community.
In practice, mev-boost facilitates an auction, where the winning builder commits to paying a certain amount of ETH for the right to provide the block that the validator proposing the next slot ("proposer") will include. This amount then accrues to an address provided by the validator, referred to as the "fee recipient".
Proposers and builders do not communicate directly, but exchange standardized messages via a third party called a "relay". The relay can determine the amount paid for a block by comparing the balance of the fee recipient at certain fixed times in the auction.
We have observed that in instances where the block in question coincidentally includes reward withdrawals due to the fee recipient, the relay has been unable to separate these withdrawals from the amount paid by the builder. This leads to an inflated value for the auction payment. This inaccuracy can negatively reflect on the Ethereum network under its current economic model (EIP-1559). Specifically, it may decrease the amount of transactions processed and decrease the amount of ETH burned, thus manifesting a small but measurable negative net outcome for the network overall.
For a deep dive, please visit: https://chorus.one/reports-research/mev-boost-withdrawal-bug
About Chorus One
Chorus One is one of the biggest institutional staking providers globally operating infrastructure for 50+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures.
Since its introduction in 2008, the Bitcoin whitepaper has marked the beginning of a transformative journey. Nations have embraced it as official currency, companies have added Bitcoin to their assets, and in 2024, Bitcoin ETFs are actively being traded. Despite these advancements, Bitcoin has struggled to shed the perception of being merely a store of value, akin to digital gold. While it's true that facilitating smart contracts was not Bitcoin's initial aim, the explosive growth of decentralized finance (DeFi) prompts a thought-provoking question: could the functionalities of DeFi be integrated into Bitcoin?
This is where Bitcoin Layer 2 solutions, or L2s, come into play. Below, we'll delve into one of the most thrilling projects in this realm - Stacks.
⚡️Chorus One is proud to join the latest team of signers on Stacks and further enhance the network’s security and decentralization. Learn more here.
It's widely acknowledged that Bitcoin stands as the most decentralized and secure blockchain. However, the high cost of its block space, low TPS, along with the need for additional computing resources among other factors, have made the development of smart contracts on its platform particularly challenging. This situation paved the way for the emergence of networks dedicated to smart contracting, such as Ethereum. Stacks, however, offers a solution to this issue.
Stacks is a novel layer built atop Bitcoin and it extends the utility of the most secure and decentralized blockchain by introducing smart contracts and dApps functionalities without altering Bitcoin's core protocol. This integration is facilitated through the Proof of Transfer (PoX) consensus mechanism, a pioneering approach that reuses Bitcoin’s Proof of Work (PoW) to secure the Stacks network, enabling smart contracts that directly interact with Bitcoin state and transactions. The goal of the Stacks layer is to grow the Bitcoin economy, by turning BTC into a productive rather than passive asset, and by enabling various decentralized applications. The Stacks layer has its own global ledger and execution environment, to support smart contracts and to not overwhelm the Bitcoin blockchain with additional transactions. It also provides mechanisms for higher performance, such as fast blocks, decentralized peg, and subnets.
The question of the necessity for a Bitcoin Layer 2 revolves around the potential of integrating fully-expressive smart contracts into Bitcoin. Successfully embedding such functionality could revolutionize Bitcoin's application, ushering in new use cases worth hundreds of billions, including stablecoins, NFTs, and Automated Market Makers (AMMs). This evolution would transform Bitcoin from a passive asset into a cornerstone of digital finance, significantly boosting its demand, value, and utility by enabling a wide array of yet-to-be-explored applications.
For blockchains with native smart contract capabilities, essential features include the ability for smart contracts to be fully secured by the network's security mechanisms, such as hash power in Proof of Work (PoW) systems or staked assets in Proof of Stake (PoS) systems. This ensures that smart contracts benefit from the same level of security as the underlying blockchain. The smart contracts not only need to have ‘read’ but also ‘write’ capabilities. As a layer on top of Bitcoin, Stacks plans to bring these features to Bitcoin through the following elements:
STX: STX, the native token of Stacks, plays a pivotal role in the PoX (Proof-of-Transfer) consensus mechanism, serving two main functions: (a) incentivizing miners to secure the Stacks global ledger, which operates independently of Bitcoin's Layer 1, and (b) ensuring the operational continuity of the sBTC peg by providing rewards to threshold signers involved in the peg mechanism. STX was distributed to the public through the first-ever SEC-qualified token offering in US history and currently enjoys a market capitalization of over $4B.
PoX: Proof of Transfer (PoX) is a unique consensus mechanism to the Stacks blockchain that is designed to leverage the security and robustness of Bitcoin, while allowing Stacks to introduce smart contracts and decentralized applications (dApps) on top of Bitcoin. In typical Proof-of-work (PoW) systems, miners must solve complex mathematical problems. In PoX, miners must transfer a base cryptocurrency (in this case Bitcoin) to join the mining process. This Bitcoin is transferred to STX holders that participate in the network by sta(c)king their STX STX tokens, thus securing the network. So in PoX, you’re bidding Bitcoin in the hopes of being selected to add the next block to the chain versus committing computation power in the case of PoW. Like other networks, the miners on Stacks get block rewards but in STX and not BTC. This dual mechanism integrates the economic incentives of both Bitcoin and Stacks.
Stacking: Stacking is not staking, but the fundamental concept is very similar. Staking involves locking up token X and getting rewards with staking yields in the same token X. Eg - Stake SOL and get rewarded in SOL. Stacking mandates depositing STX tokens to get rewarded in a different token (BTC). This synergy between BTC and STX is interesting and actually incentivizes BTC holders to participate in the STX ecosystem. STX holders on the other side are incentivized to stack their tokens to be rewarded in arguably the most decentralized and secure cryptocurrency token BTC.
Signing: Post the Nakamoto release, the role between Miners and Stackers has been segregated. Where previously, miners decided the contents of the block and also decided whether or not to include them in the Stacks chain, now they would only be deciding the contents of the block and the stackers would be taking on the role of deciding whether to include them in the block or not. Stackers validate and sign blocks through a distributed signing protocol, requiring a significant fraction of locked STX to agree on block inclusion, thus preventing forks and enhancing the chain's integrity. Chorus One is proud to join the team of signers on Stacks along with other industry leaders likeBlockdaemon, NEAR Foundation, DeSpread, Alum Labs, Kiln, Luganodes, Copper, and Figment.
sBTC: sBTC is a fungible token that is pegged 1:1 with Bitcoin to enable Bitcoin holders to participate in the Stacks ecosystem. Users who want to interact with BTC and developers who want to create apps with BTC programmability can both use sBTC, thereby extending BTC’s utility beyond Bitcoin. To deposit BTC into sBTC, a Bitcoin holder would create a deposit transaction on the Bitcoin chain. This deposit transaction informs the protocol of how much BTC the holder has deposited, and to which Stacks address the holder wishes to receive the sBTC. The sBTC system responds to the deposit transaction by minting sBTC to the given Stacks address. To withdraw BTC, a Bitcoin holder creates a withdrawal transaction on the Bitcoin chain. This withdrawal transaction informs the protocol of how much sBTC the holder wishes to withdraw, from which Stacks address the sBTC should be withdrawn, and which Bitcoin address should receive the withdrawn BTC. In response to this transaction, the sBTC system burns the requested amount of sBTC from the given Stacks address and fulfills the withdrawal by issuing a BTC payment to the given BTC address with the same amount.
Clarity: Stacks also has its native programming language called Clarity, crafted with a focus on safety and security. The inspiration for Clarity's development was drawn from analyzing and addressing vulnerabilities commonly found in Solidity. By integrating these lessons, Clarity was meticulously designed to offer a secure coding environment, prioritizing the prevention of exploits right from its core. You can read more about Clarity in the online book - Clarity of Mind.
Total supply: ~1.82B
APY: 6% (BTC)
We currently support infrastructure for over 50 networks, and we're thrilled to announce that Stacks will mark our inaugural support for a Bitcoin Layer 2 solution. This is a significant milestone for Chorus One, largely due to the exceptional team behind Stacks, whose expertise and dedication have been evident over many years of development.
If you have STX tokens and would like to stack them, feel free to reach out to one of our experts at staking@chorus.one.
To read more about Stacks, we recommend the official documentation available in docs.stacks.co.
Chorus One is one of the biggest institutional staking providers globally operating infrastructure for 50+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures.
Proto-danksharding, blobs, and data availability are terms becoming increasingly familiar in the Ethereum community, all leading up to the Dencun Upgrade – Ethereum's most significant update since Shapella.
With less than a month to the upgrade, Chorus One is here to provide you the essential information about this pivotal event, including three key staking/validator based Ethereum Improvement Proposals (EIPs) involved, with a special focus on the much-anticipated EIP-4844.
In April 2023, we explored the post-Shapella landscape in our blog article "Beyond Shapella," highlighting the significant impact of the Shapella upgrade on Ethereum staking. This upgrade introduced the flexibility to withdraw staked ETH and rewards, captivating institutional interest in Ethereum, the second-largest cryptocurrency by market cap.
The Shapella upgrade marked a turning point, boosting ETH's staking appeal among institutional investors. Since then, Ethereum's roadmap has seen several developments, leading us to the brink of another major milestone - the Dencun upgrade. This forthcoming hard fork is set to advance Ethereum's evolution, promising to tackle existing challenges and open up new opportunities.
In fact, Ethereum jumped 28% since the start of February and rose above $2,900 at the time of writing, as the Dencun upgrade approaches and transaction numbers on L2s climb up.
The Ethereum Cancun-Deneb (Dencun) Upgrade, scheduled for March 13, 2024, is a pivotal hard fork aimed at enhancing the network's scalability, security, and usability. This upgrade, incorporating key Ethereum Improvement Proposals (EIPs) such as EIP-4844 for proto-danksharding, is set to improve network efficiency and lower transaction costs. Building on the achievements of prior updates like the Shanghai upgrade, Dencun seeks to fortify the infrastructure for decentralized applications and elevate the Ethereum user experience.
At its heart, the Dencun Upgrade integrates advancements from the Cancun upgrade on the execution layer with those from the Deneb upgrade on the consensus layer, employing a dual approach to refine Ethereum's protocol rules and block validation procedures. The inclusion of various Ethereum Improvement Proposals (EIPs), especially Proto-Danksharding, is geared towards enhancing scalability from different dimensions.
Additionally, the upgrade will introduce a series of other EIPs, including EIP-4788, EIP-6780, and EIP-5656. While this article will concentrate on the most crucial proposal, EIP 4844: Protodanksharding, it will also touch upon three staking and validator-centric improvements within the Dencun Upgrade: EIP-7044, EIP-7045, and EIP-7514.
EIP 7044: Perpetually Valid Signed Voluntary Exits
The introduction of EIP-7044 marks a significant advancement: exit messages will have indefinite validity, removing the need for continual updates and ensuring a smoother withdrawal process. This EIP specifically targets the challenge posed by the limited lifespan of signed voluntary exit messages, simplifying the staking landscape, especially in cases where the staking operators and fund owners are not the same.
TL;DR: EIP-7044 makes it easier to withdraw staked funds by ensuring that exit requests don't expire. This removes the hassle of having to update these requests regularly, especially helpful when the staking operators and fund owners are different.
EIP 7045: Increase max attestation inclusion slot
EIP-7045 modifies the timeline for attestations, extending the inclusion period from one rolling epoch to two fixed epochs. This adjustment gives validators additional time to incorporate their attestations into a block, thereby enhancing the security and stability of Ethereum's Proof of Stake (PoS) consensus mechanism. The expansion of maximum attestation slots contributes to quicker block confirmations and bolsters the consensus mechanism's resistance to short-term censorship attempts.
TL;DR: EIP-7045 changes how long validators have to get their approvals into a block, extending it from one flexible time period to two set time periods. This extra time helps make Ethereum's system for confirming transactions more secure and stable, speeds up the process of confirming blocks, and makes it harder for anyone to temporarily block or censor transactions.
EIP-7514: Add max epoch churn limit
EIP-7514 proposes to change how fast new validators can join the Ethereum network. Instead of the current system where the number of new validators can grow quickly (exponentially) because the amount of new validators accepted also grows, this proposal suggests a steady (linear) increase by setting a limit of 8 new validators per epoch (~6.4 minutes). This means no matter how many people want to become validators and how big the active set grows, only 8 will be able to join in each epoch. This approach aims to make the network more manageable, especially when a lot of people are waiting to stake their ETH. It helps prevent the network from getting overloaded and keeps everything running smoothly.
TL;DR: EIP-7514 plans to limit the number of new validators joining the Ethereum network to 8 every 6.4 minutes. This change aims to control growth and prevent the system from becoming overloaded, ensuring it runs smoothly even when many people want to stake their ETH.
EIP-4844, known as Proto-Danksharding, is a key update to Ethereum that introduces a new type of transaction called "blobs", for better data storage efficiency. This allows for more cost-effective data posting to the Ethereum mainnet by Rollup sequencers, without overloading the network, due to the controlled size and quantity of blobs in each block. The innovative aspect is the temporary storage of blob data in Ethereum's consensus layer, not its execution layer, which boosts scalability while keeping the network decentralized. Proto-danksharding sets the stage for further scalability enhancements, such as full Danksharding, by improving gas consumption and network resource management.
Proto-danksharding allows these rollups to employ data blobs for posting grouped transactions more affordably, greatly decreasing operational expenses and enhancing scalability.
The Dencun upgrade is set to significantly enhance Ethereum's appeal, making it more attractive for developers, builders, and investors, by boosting transaction efficiency and cutting costs.
At Chorus One, we've been diligently preparing for this upgrade, ensuring our clients and software are updated in a timely manner to prevent any impact on our users. Our proactive approach underscores our dedication to facilitating a smooth transition and maintaining strong staking support after the upgrade.
Chorus One is one of the biggest institutional staking providers globally operating infrastructure for 50+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures.
We're excited to announce the launch of "Staking Synopsis", a series dedicated to keeping Ethereum stakers and enthusiasts informed about the latest updates in ETH staking, including the developments at Chorus One.
With the highly anticipated launch of EigenLayer's Mainnet scheduled for April, and its rising prominence in the Ethereum community, we're kicking off the series with a special focus on Restaking.
As frontrunners in Ethereum research, we're focused on developing a carefully curated restaking strategy to optimize the benefits of this technology for our users.
So, our series will cover everything you need to know about our approach, which positions us as a top choice for ETH staking and restaking among node operators.
Let's dive into our first edition!
Engaging with EigenLayer by depositing liquid staking tokens (LSTs) or your staked ETH enables you to accumulate ‘Restaked Points’, reflecting your contribution to the EigenLayer ecosystem's collective security. These points are calculated based on the duration and amount of your staking participation.
By accumulating ‘Restaked Points’, you not only enhance your rewards on your LSTs or staked ETH but also become eligible for potential airdrops!
Note: Please be aware that although staked ETH deposits into EigenLayer are currently accepted and can be withdrawn at any time, rewards can only be redeemed after the launch of EigenLayer’s Mainnet and once the Activated Validator Services (AVSs) utilizing EigenLayer's pooled security become operational.
Chorus One makes the staking and restaking process straightforward and efficient.
Here’s how it works:
Delegating your restaked ETH to Chorus One
At present, you can only deposit your staked ETH into EigenLayer; the option to delegate to node operators is not yet available.
We will notify you once the delegation feature on EigenLayer becomes operational, indicating that it's time to delegate your restaked ETH. At that point, you will be able to delegate to Chorus One with just a few clicks.
Visit OPUS ‘Dedicated’ to get started.
Note: Restaking LSTs with EigenLayer is currently on hold and will resume once the deposit cap is raised. In the meantime, you are welcome to use OPUS 'Pool' to stake any amount of ETH and mint osETH.
Visit OPUS ‘Pool’ to get started.
Chorus One aims to make restaking as accessible and simple to all users as possible. In doing so, we have a tailored AVS and restaking strategy that makes this possible in the following ways:
Selective AVS Strategy: Contrary to other node operators who may aim to onboard as many AVSs as possible, Chorus One adopts a more strategic approach.
We prioritize security and are currently in the process of carefully vetting AVSs for which we provide infrastructure. Given any risks associated with restaking, we believe it's crucial to conduct thorough research on each project we support.
Enhanced Rewards with Adagio: As pioneers in MEV research, Chorus One stands out by utilizing an in-house Ethereum MEV-client, Adagio. This unique tool enhances the MEV yield for all ETH validators we run by implementing strategic timing games. Learn more about Adagio here.
By choosing to stake and restake with Chorus One, your validators benefit from using Adagio, yielding higher rewards compared to alternatives.
Top-Tier Security with ISO 27001:2022 Certification: Chorus One is among the select few node operators to achieve the ISO 27001:2022 certification, a globally recognized standard for security.
This certification isn't just a formality for us; it's a reflection of our deep commitment to maintaining the highest levels of security in our staking infrastructure, operations, and systems, ensuring our customers' peace of mind.
(Source: Dune Analytics)
An EigenPod is a user-managed smart contract designed to aid in the administration of balance and withdrawal statuses within the EigenLayer protocol.
When organizing your EigenPod and delegating your restaked ETH to a node operator, consider the following: You may point multiple validators to a single EigenPod.
This underscores the importance of judiciously selecting a node operator to delegate your staked ETH to, taking into account their specific restaking and AVS strategies.
If you’re interested in staking/restaking with Chorus One, or learning more, simply reach out to us at staking@chorus.one and we’ll be happy to get back to you! Here are some useful resources for your benefit:
Additionally, if you’d like us to share further resources on any topic, please let us know!
Chorus One is one of the biggest institutional staking providers globally operating infrastructure for 50+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures.
