Solo staker report, Dappnode supports Rocket Pool - The Daily Gwei Refuel #593 - Ethereum Updates

Transcript

hello everyone welcome to another episode of The Daily gray refuel where we kept the latest news in ethereum ecosystem I'm your host and this designer until the 29th of May 2023. all right everyone let's get into it so I'm not sure how I missed covering this last Friday but there was a great report that came out from the raider.network team here covering solo stakers so they teased this a few weeks ago and I remember covering it on the refuel that they had found uh what percentage of solo stakers were on the network uh basically using some kind of parameters that they detail on their blog post but the headline here is that solo stakers on the ethereum mainnet represent 6.5 of the as active stake as of the end of 2022 so the data they they looked at only went to the end of 2022 so it's

obviously missing about five months worth of data here and obviously a big part of data because it's when withdrawals went live but I'm sure they're going to be doing an updated post on this at some point in the future maybe a year after withdrawals go live maybe sometime next year there'd be a good good thing to look back on and see see how much of the network is now solo stickers but this is great I mean 6.5 of the network being solo stickers is a huge achievement in my eyes I know some people might say this seems low but I don't think so I think that given that the barrier to entry for solo staking is so high on the capital requirement side uh obviously you're needing 32 per validator even if you are a solid stacker maybe you only have one validator because that is a huge Capital

requirement there and I think they've also included uh rocker pool mini pools as solo stickers as well so there is a less of a couple of requirement that there was 16th uh as I said this goes to the end of 2022 so it's not including the 80th mini pools only including 16 eighth but still that is a large Capital requirement even if you just bought your eighth at like between one and two grand that's 16 to 32 000 US Dollars you have to put down to become a a mini Port operator when it was 16 Heath and then you also had to have the RPL Bond as well now that given that the fact that 6.5 of the whole network is is still considered a solo Staker um is amazing to me I think that's a huge achievement

and I also think that it's a it's a big achievement not just because of the capital requirements but also because of the technical know-how uh that's needed as well because we all know that most of solos staking today is not one click like if you're running your own hardware and you're not running like a Dap node or something it is definitely not an easy process to get spun up as a solo Staker even rocker pull I mean spinning up a mini pool is not that hard the documentation is pretty good but it is not for the faint of heart it is not for total noobs because they're still command line stuff that you have to do even though you get a nice graphical user interface it's still something that may seem foreign to newer people to um you know to to uh to new people to that

sort of stuff so I think as I said this is a very very impressive number now diving into the actual blog post itself they have how they Define solo stickers now this was something that I brought up when this blog post was teased I think it was teased a couple months ago at this point because I really wanted to know how they're actually defined a solo stay car because there are various different ways you can Define them so they have four Key Properties here the first one is that solo stickers are independent operators and are not part of a major organization uh so I think I brought this up when I was talking about this this is definitely like pretty much critical if you're gonna be a size like you can't be part of a major organization because then you really aren't a solar Staker even if you're

running your own kind of validators and you're not part of any other a service like a centralized exchange or a staking service you still wouldn't really be considered a solo Staker because uh you're part of an organization that's staking and maybe you're staking for other people as well or anything like that and then they said you know as such a solid sticker might routinely lack 24 7 monitoring and slas and might experience more frequent and longer downtime periods seen less frequently among professional operators second uh definition here is solo stickers run infrastructure on premises or in a VPS but mostly on premises and they do right I mean I obviously run all my validators on premises I have my own Hardware here a lot of the people that you see talking about running their own validators share pictures of their own little knock which is obviously at their

home there are people who do run it on vpss but those things can get quite expensive given the bandwidth requirements so a lot of the times it ends up being cheaper just to host it on Prem so that's what they found here as well I think that a lot of uh people were running their Solo validators on-prem or at their at their homes uh the third definition here is solo stakers fund all or some in the case of rockapool of the stake through their own means obviously this is done because if you're a solo stacker if you're an individual no one is giving you eat to stake for them maybe you you are stacking on behalf of some other people but I think for for most people you acquire the eat yourself you buy it yourself maybe you mind it maybe you know maybe you're a minor turn Staker

here uh maybe you earned it throughout through some other means and then you stake it on your own there is no other way that you require it here you know it's not like you're taking in eighth from uh random users around the world like so like staking protocols do or staking LSD protocols do and essentialize exchanges and things like that and the fourth definition is that solar stake is in their majority run fewer than 200 validators each now this is obviously just natural because uh that is a lot of money right if you have 200 validators I mean to do the math off the top of my head right now that I think that's 6400 eighth right uh that is I I think what seven eight million dollars or something like that I I don't know exactly how much money that is but that's a crap ton of money so obviously

most people are not going to have anywhere near that um and it says here that over this level even if the entity is unknown uh they assume some sophistication that's beyond the hobbyist amateur level caveat there are a few savants out there who managed to run 300 validators from adapt node but yeah the majority would sit between the one to ten validator Mark I would believe and then obviously uh you get less than those people as more more goes on from there because the capital requirements get so large and then this blog post is quite detailed you can check it out I'll link it in the YouTube description below but they continue and basically uh talk a lot about these definitions talk about how they actually came to this conclusion they have a really cool visualization here that is a heat map that basically shows the St the

stake distribution so blue is uh solo validators and then red is centralized validators like coinbase and taking service providers and and things like that and you can scroll down here and see their classification or their nice little pretty charts here the summary results and all the good stuff there so I think I've said most of what I wanted to say about the post itself I highly recommend giving it a read there is one last thing that I wanted to point out here which I thought was was pretty cool and it was one of my main takeaways uh from the post they said here early data implies that the number of validating Beacon nodes that might map to solo stakers range from 35 to a whopping 75 percent out of the hole out of a total approximately 3 000 nodes that uh they've been able to pass in their

analysis and they said yeah we'll be following up with a post that discusses our findings there in the coming weeks now the reason why this was probably the biggest takeaway for me other than that headline number of 6.5 solo validators is that uh of the 3000 nodes if even the lower end here 35 is run uh by solo stickers right on premises uh and and and and basically basically of the of the entire network work that is extremely healthy for decentralization that means you have disparate individuals all around the world accounting for a large chunk of the ethereum network and that improves decentralization because obviously it would be very hard if not impossible probably impossible to shut down all of

those nodes right to go after all those individuals it it would be very hard because not only is it distributed across the globe but also you could I don't know worst case scenario fingerprint them get their IP address if your law enforcement go visit them at their house and say you need to shut down your beacon node but you have no guarantee that they've done that because maybe they're going to run maybe they're running one in the cloud remember they decide to run one in the cloud or maybe they're behind a VPN and it becomes harder to track and the resources aren't worth it it just becomes a very cat and mouse game so I thought that was the main takeaway for me is that like a huge number of uh the overall ethereum Network nodes are actually run by solo validation and on-prem which is really

really cool to see but anyway as I said you can check out the blog post for yourself it's really great highly recommend giving it a read I'll link it in the YouTube description below and I'll for sure talk about the the next project I'll publish about these numbers that I just spoke about when they do end up publishing that all right so I mentioned last week that the kzg ceremony was very close to hitting 100 000 total contributions uh well we hit it which is just absolutely awesome to see that we're at that 100 000 uh dollar 100 000 contributions Mark here uh it's great to see the ethereum community coming out in waves for this I know I mentioned last week that there might be some airdrop farming here but that's okay because really I mean the the people uh doing that or also contributing to

the kcg ceremony so it's actually a net positive in the end I think that we've had so many contributions here and just a quick refresher here for those of you who don't know this ceremony is required for erp4844 so this was obviously critical to get done before 4844 goes live hopefully at the end of this year on the network and it's great to see that we had such a huge turnout for this and it's going to provide a lot of great entropy 448.44 and give us near certainty or pretty much certain I mean nothing's ever 100 but we're at like the 99.999 mark that uh the ceremony was run properly and that the it you know because it's a one of entrust assumption that it is all good and it's going to function as expected but uh yeah if you haven't contributed yet you still have

time to do so you can go visit the site uh for yourself um I believe the site is linked on um on Carl's profile here but also you can just go to uh ceremony.ethereum.org is where you need to go to to contribute there alright a new chart from Tony who runs the Mev boost.pix website so this is a chart that's showing total Mev distributed through Mev boost as measured in eth terms and it is over 200 000 eth since uh I believe the merge uh no since sorry since the launch of Mev boost which was around the time of the merge I guess uh and you can see here that uh it's pretty crazy I mean that's a pretty crazy amount of eth that has basically been distributed to uh to

validators essentially through Mev boost through both toxic and non-toxic Mev and someone replied here saying you know this is seriously messed up and then Tony says I agree that those funds should have never been extracted or paid back to the users who lost them through AV block Mev share Etc but hey it's still better than letting the Searchers grab them and then then someone says well these searches are doing something but seriously I think that ethereum should have never switched to pause before properly implementing PBS on the protocol level in the first place I don't think that that's really the correct way of looking at this because uh the the only reason why it's become so prevalent on the pause as opposed to proof of work is that Mev boost has been live under proof of stake a lot longer than proof of work I believe before the

merge Mev boost was live and 30 of the network had already adopted it so it would have been the same under proof of work I believe and obviously we all want PBS to be implemented we will all want to eliminate as much Mev uh extraction as possible but it really is a long-term game here guys and it's better that this eth in my mind it's better that it is going to at least at least staying in the ecosystem we're going to validators here and obviously with Mev burn we would be burning it as well uh hopefully in the future um then going somewhere else but yeah it is not something that should be considered generally unnecessarily healthy because a lot of it was extracted from directly from users via front running back running especially

sandwich attacks I mean the sandwich attacks get really bad when you have a lot of new people that come in that have absolutely no idea how to protect themselves from Mev and kind of indiscriminately aping things with like a hundred dollars on Main Nets and they're just buying Pepe coins and things like that and then the sandwiching Bots like Jared from Subway for example take full advantage of this and make a lot of money from it but you know the funny thing is as bad as it is if the users themselves aren't actually caring because they're literally just gambling on Meme coins um like I don't know I kind of I struggle to have sympathy for them right because if you actually cared about not getting screwed over here then you would do something to protect yourself we can't just hand hold everyone right we

can't just expect everyone to uh to basically play by the rules that we think they should play by but the way we're designing the PBS scheme and the Mev burn scheme and things like that is so that users don't have to worry about this so that we can actually protect them without them even knowing they're being protected which is I think a fair way of doing it but at the same time like I just do not have well I just can't bring myself to be that sympathetic towards uh people who really they don't even care I mean if I told him imagine telling someone who's just buying 100 dollars worth of Pepe on mainnet hey you know you got uh kind of like uh uh I guess like uh what's what's the word for it I mean it's not rugged or anything like that but like you lost

a bit of money here because someone sandwich attacked you they're not gonna care they're like what's a sandwich attack and you're gonna have to explain maybe you're gonna lose them within like two seconds they're literally buying a meme coin because they think it's going to pump and they're going to win the lottery and and and be able to cash out and make money off of it they don't care about any of this stuff but again as much as I I say I don't really have sympathy for them um at the same time I don't think that they should be getting harmed by this I think we should do what we can to protect them but also a lot of the improvements coming to to ethereum to address this like PBS and Mev burn are really just being done for the health of the ethereum network it's not really

about the users first I think that the users obviously are helping the users out and protecting them from this sort of stuff is important but what comes first and foremost is the health of the ethereum network because at the end of the day if you keep the ethereum network healthy and you make sure that it's functioning as it's supposed is doing a decentralized sensitive resistant way then in the end you are helping every single user of the ethereum network get benefits out of that anyway so that's the way I view it but I mean you might view it differently you might disagree with me there I'm not saying it's it's a good thing or a bad thing I just personally if someone doesn't give a that they're getting kind of I guess um erect by a sandwich attack I mean there's not much more you can do

you can tell them you can say hey use this protect yourself which you should mind you I mean you should be using things like cow Swap and and uh Mev uh resistant uh rpcs or rpcs that give the MAV back to to you instead of um the the Searcher and stuff taking it but uh but yeah that's a kind of like opt-in thing that users need to do whereas putting in PBS putting an Mev burn is is more of a kind of like forcing function of the network itself all right so dap note has finally announced that they have uh added support for a rocker pool so you can now basically set up a rocker pool mini pool or rocket pool smart node stack using the adapt node software now for those of you who don't know what dap node is it's

basically a nice little interface that you can run on any hardware uh basically that allows you to do a few clicks ethereum staking running ethereum nodes running notes for different networks and now you can do the same thing with rocker pulls so if you're interested in this you can check out dap node you can check out this tweet I'll link it in the YouTube description below but this goes back to what I was saying before about essentially making staking easier for people across both kind of fronts here one obviously is the capital requirement front to be a solid Staker rocker pool is doing amazing work here by lowering that Capital requirement now it's eight eighth and 2.4 eighth worth of RPL I believe in the future it will hopefully be even less than that but the hardware uh sorry not the hardware requirements our requirements are actually pretty

cheap right now but the actual software and being and the um the ease of staking the ease of solo staking whether that be as a solar validator or as a rocker pull node operator is still not where we need it to be for to get as many people involved as possible and you know I've argued this point before on the refuel and I basically said that I don't think it's like a huge deal that we don't have total noobs staking on the network I think that there has to be at least some kind of uh sophistication for solo stickers I don't think we should make it as easy as people just being able to push a button or and become a solo home operator and then forget about it because you can't forget about it if you're a solo nerd operator you actually need to pay attention because maybe

something goes wrong with your node and you need to to diagnose why or maybe your node goes um goes offline and you don't know why and you have to diagnose that you're going to have to keep up with the in the network upgrade you're going to have to upgrade your execution and consensus layer clients you're going to have to update them for General uh improvements and if there's bugs found in them and things like that you're going to have to monitor the health of it to make sure that you're actually a testing tune and and proposing blocks if you're running Mev boost you need to monitor that so it's I don't think we're going to get to a point ever where it's going to be a totally like hands-off thing and nor should it to be honest because you are being paid for this work

it's not like you're doing something out of altruism so there should be some level of sophistication here in saying that it shouldn't be so hard that you have to learn the command line or anything like that we should be able to provide these nice graphical user interfaces for people that they can just use and that they can easily manage their whole operation from without having to learn all this complex stuff about computers that they never would have had to learn before so that's where I think we should get to and that's what I think dap node is doing that's what rockapool is doing by by making guise for the smart note stack well that's smart is actually a GUI a graphical user interface so that's all very important but generally yeah I don't I mean I say we shouldn't dumb it down to the point

where people don't even pay attention to it but I don't think we actually can get it to that point because you're not going to be um on the correct chain if you don't upgrade your notes like if an upgrade's coming say dencoon at the end of the year and you haven't upgraded your nodes you're going to be on the wrong chain and you're not going to be a solo sticker anymore you're just going to have something that is a dead chain you're not going to be attesting the blocks and you're going to basically be inactivity leaking out and then eventually going to get kicked out of the validator set so you have to pay attention to that and same goes for being offline things like that just generally your internet goes off maybe something bugged out with your box you need to be able to diagnose these things

so there is going to be always some level of sophistication there but we shouldn't make it harder beyond that we should be able to get to that point and then like make it as easy as possible from from there but anyway I ran a little rant done there moving on to the next bit of news here from opal Labs so opal has a detailed oval V2 so they've got a post here called looking forward opal V2 and they say in our continued effort to build the opal Network we have begun a working group to research specify Implement and maintain opal V2 the distributed validator protocol so V2 seems to be I guess like the actual protocol at itself so the way that they're going to be running this this protocol and decentralizing it and making sure that they can turn it into a

thing like a dow and that people can can adopt it with relative ease and stuff like that so you can read this post for full details on that and for those of you who don't know and want to refresh of what Opel is it's a distributed validated technology provider basically what distributed valid techno technology does or DVT does it enables something that I like to call called Squad staking which basically means that you can have like a group of four friends that all run the validating software on their um on their boxes but only have to put in eight eighth each instead of the full 32 for that validator and they can do this as many times as they want and it's not just for Squad staking it's also for things like redundancy where essentially you can run DVT across uh you know the entire world and basically have

redundancy in case one of your uh I guess instances goes offline the other ones that stay online and you're all well and good and it's much better than having like backup boxes where there's a potential of getting slash for double signing and stuff like that so opal and DVT Tech generally are very very exciting and it's cool to see them looking forward to their V2 which you can check out the blog post for which will be linked in the YouTube description below all right a nice visualization that I came across from taken's theorem over the weekend so they captioned this with what do 10 000 wallets do after they Bridge from ethereum mainnet to optimism the reason why I think this is really cool is because it basically shows like the birth of a new ecosystem because a lot of these layer twos or most of them

are going to get their initial users and a lot of the I guess like users of their chain bridging in from ethereum mainnet so you can see here that at the beginning there was nothing and then a whole universe explodes right as soon as optimism comes online there's all these deposits that are made through the bridge and then all these people go off in different directions they do different things they interact with different apps they maybe Bridge somewhere else uh they maybe go to an exchange they do all these different things on on the optimism Network and all the other Layer Two networks and I just thought this was an absolutely amazing way to visualize that and and see how ethereum as a network can spawn these layer 2 networks as basically new galaxies and then uh and then implants itself onto them can

basically send uh people to them to inhabit the worlds that exist right so it's a loose analogy but I think it's pretty cool when you think about it like that and visualize like this it definitely does look like space right it's black and these little white dots look like planets or like little beings and then you've got like lasers shooting everywhere I guess but yeah I'll link the the uh the visualization the YouTube description below for you guys to check out if you don't know what I'm talking about because you're listening to the podcast but I just thought that was very cool and antagon's Theorem generally has a lot of great visualizations and I've highlighted a bunch of them before on the uh the refuel but you can go check them out for yourself if you want to get more of this sort of stuff uh on their

Twitter profile you can just scroll through it and you can see uh all of this uh they've got plenty of this stuff here it's actually pretty crazy how many of these that they've done so far I don't know if they have a website or anything I think they they might I don't know what this is taken's theorem.weebly.com oh yeah there is a website so the website's probably easier than the Twitter profile so you can check out uh everything here that they've that they've done all the visualizations it's very cool you can get lost in this sorts of stuff and you can and and you can probably have a little bit of a troopy experience going through it all so yeah I'll link this in the YouTube description below for you to check out all right finally yeah we have eighth Global that's published there 10

autonomous worlds finalists now for those who don't know what autonomous worlds are basically it's this I guess like new ecosystem of projects that are trying in the gaming World um that can expand Beyond gaming but that are trying to basically build worlds within the ethereum ecosystem that can operate on their own in an autonomous fashion so it's basically taking the concept of dows and applying it to these kind of Worlds whether that be a video game or some kind of a community or some or some kind of uh I guess like um games communities and and other such things in in in in those things that's kind of like what it's trying to do now these oh this obviously

wasn't possible on layer one ethereum because it would be too cost prohibitive but on Layer Two there is a lot of stuff happening I've mentioned some stuff like opcraft before I mentioned some projects on Stark net before especially the ones that are set in space that are really cool where basically you have like a whole universe um there was one I've forgotten the name right now there was one that was actually on xdi uh and then I think they've migrated to Stark net that people played uh it was a ZK game as well that was like an autonomous World essentially that allowed you to do all this sorts of stuff and I think this stuff is very cool this is the stuff that I am really excited about when it comes to crypto gaming the stuff that actually pushes the boundaries innovates on gaming as a as an ecosystem doesn't

just slap nfts on it and slap you know crypto monetization on it it actually incorporates different kind of crypto Primitives and different autonomous worlds Primitives in order to uh enhance the game so for example there's this game called realm of Pepe and it says yeah it's a Cooperative Adventure RPG with novel Resource Management mechanics powered by superfluid you can collect resources trade and progress through stages to defeat the evil Pepe so it's taking obviously a tried and true game genre here of of RPGs uh and basically a blending in crypto Primitives like superfluid uh and enhancing the game that way which I think is is very very cool so I mean you can go check out all these projects for yourself uh in this

trade which will be linked in the YouTube description below but generally uh this is this kind of stuff that I'm paying attention to when it comes to crypto gaming rather than the games that are just slapping on you know nft mechanics or look more like ponzis than games and honestly I wouldn't say there's anything wrong with those sorts of things it's just not not things that interest me because gaming I I've had like a love and hate relationship with for 20 years now I've been playing games for a very long time um and the love and hate relationship comes from I love Indie Games still but most AAA games are really disappointing Mobile gaming is absolutely shocking and the reason why is because it's become such a saturated business now where essentially it's just about making as much money as possible and extracting as

much money from the consumer as possible and it's just it's become really Bland and a lot of the AAA games that get released get released broken buggy they just don't have much soul in them that's why I really love indie games they play a lot of Indie Games they've still got a lot of style in them they're not trying to suck all the money out of you there are very few mobile games that I enjoy um there's one called like alto's Odyssey and alto's Adventure which I believe might have Micro transactions in it I'm not not sure because I'd never actually use them I didn't need to um but I thought I I love those and there are some mobile games that are available on other platforms as well uh like dead cells for example it's a roguelite I love those kinds of games too but they're all indie games right

they're not these massive AAA games that are just sucking money out of consumers and I think I want to see more of that in crypto because crypto can very easily fall just straight into that kind of just suck money out of people because of the Ponzi nature of of these things and because of the speculative nature of these things so that's why I like looking at the autonomous World stuff because it reminds me more of Indie gaming uh and less of AAA gaming but I'm sure there's going to be like a massive AAA game that gets released that's going to be uh you know have crypto Primitives in it and have nft stuff in it and just be a huge speculative thing you know I I think with axi infinity it was basically a teaser of what this stuff can look like but it's not going to be something

that generally interests me because I play games to have fun I don't play games to make money um and I think that a lot of people not make man I play games to have fun not not pay the not to not not play them to both make money or try to make money or spend money to improve my experience through in-app purchases or in-game ironing purchases or things like that I want to play games for the fun of it I want to play games that have soul and I think the autonomous worlds category definitely can can do a lot of great work there but anyway you can check out this thread for yourself I'll link it in the YouTube description below now I just wanted to to talk a couple of minutes here about not the markets but about kind of sentiment generally what I love

right now is that the sentiment I guess across crypto Twitter and crypto circles generally has been the same for the last few months we're all very well aware that we're in like a sideways crab market we're all pretty much waiting for the market to heat up again but things are still growing things are still happening a lot of things that I'm seeing happen uh kind of very funny signs of capitulation that remind me of 2019 like recently I'm sure a lot of you saw that the uh Paradigm VC fund has actually changed from being just a crypto fund or mostly a crypto fund to now doing like Investments within all of Tech basically and I think there's nothing wrong with that but it kind of speaks to the fact that they

have so much money that they need to invest and there's just not that many great crypto projects uh right now that that uh that are raising because or I mean not even just great crypto projects in general because obviously there are more projects to fund during a bull market valuations go up there's more money to be made so you're more comfortable investing a lot of money there um but like those sorts of things just scream capitulation to me it just says to me that we're in firmly in the time-based capitulation phase that I've talked about before and it really is the best time to be learning uh you know getting involved as much as you can on the social side of things and potentially stacking and DCA and crypto I mean that's not investment advice I'm not going to tell you what to buy and

when to buy it or anything like that but generally you like my rule of thumb investing and this is a long-term thing is you buy when it's quiet you buy when it's boring you sell when it's exciting right you sell when it's crazy you sell when everyone's talking about it and people make memes about this all the time they're like oh I'm gonna sell the next time my Uber driver talks to me about crypto I don't think those social signals are going to work very much longer I don't even know if they're going to work the next time we have a bull market because crypto is is pretty well known at this point I mean I I don't think you'd be able to meet someone uh in the western world that hasn't at least in the western world that hasn't at least heard of Bitcoin

before maybe even heard of ethereum obviously Bitcoin is is a much bigger brand outside of crypto because it just gets mentioned in mainstream media a lot but but generally I don't think those social signals are going to work that much anymore and especially because I think the general trend trend is that post covered a lot of the world has become very I guess speculative and there are a lot more people investing now than there ever has been and not just in crypto but in a lot of other asset classes um and even things that you might not consider might not consider asset classes are getting a lot of money flow into them so yeah generally my rule of thumb no matter in the market conditions no matter the market is that you sell when it's but it's absolutely crazy and you buy when it's quiet and honestly I've been doing

that for a long time now and it served me quite well uh you have to be happy not selling the top and not buying the bottom you're never going to be able to pick those things maybe you do it by by fluke one time but generally you're not going to be able to to pick those things and it's better to DCA in either direction in my opinion but as I said that's just not investment advice that's just general kind of this is how I play things this is what I do and this is how I kind of view things um you know across different asset classes not just crypto but on that note that's going to be it for today so thank everyone for listening and watching be sure to subscribe to the channel if you haven't yet give it a thumbs up subscribe to newsletter join the Discord

Channel and I'll catch too old tomorrow thanks everyone