DappCon 2023: Taking Decentralization Beyond Current Borders- Pol Lanski

Transcript

hello there how we doing how's everybody lunch was good yeah feeling like a little bit like oo like I'm going to have a nice nap in uh in today's talk right now yeah after lunch you know it uh well you can but uh it's going to be a challenge because I'm going to try to make it as hard as possible for you to lose interest on this now we're going to talk about taking decentralization ation Beyond current borders what does that mean well I think before before starting with decentralization we should have like a common understanding of what I mean with the

centralization right we can have um like a bunch of this we're going to be creating systems that are technically have the ability to be the centralize but actually the centralization is a gradient in which properties emerge what does this mean well you can have like the most Byzantine full tolerance resistant protocol in the world but if you have one node this is a centralized system I'm sorry uh if you have two nodes you start getting like a little bit of very basic data redundancy as an emerging property of this a little bit it starts

getting interesting when you have nodes in different locations um you get res resistance to uh some natural disasters for example you get nodes in different Power grids you get resilience to power outages you get nodes in different political jurisdictions means that you are now resistant to political inference that's starting to be very interesting for the centralized systems like nosis chain or ethereum you have nodes in different types of heart Hardware different tab types of cloud providers now you have resilience to Hardware failures vulnerabilities and why do we

have so many client implementations on with written in different types of code because this way we are resilient to bug zero day exploits vulnerabilities etc etc etc Plus on top of this we have system specific type of properties that emerge that come out or emerge emerge when we have different sets of validator ownership or different sets of validators owned by different people if we're talking about proof of work different hash rate concentration different bandwidth storage con connection etc etc this is not um this is very very similar to what in uh Aerospace industry uh it's called the

similarity and it gives resistance to common made failure right this is not specific about blockchain we're not inventing anything new but we are uh using these properties now we know about decentralization and we know that it's good because it gives you all of these properties for the longest time we've considered solo staking as the gold standard of decentralization and solo staking is amazing it might well be the gold standard of decentralization because it works in any country it depends on one person deciding to run a validator or a node and this person can be in any geopolitical jurisdiction it can be

under any ISP under any power grid it doesn't really matter you can have nodes everywhere in the world thanks to the power of solo staking it also favors um small and Nimble groups one note caters to very few validators so if one note goes down that may be sort of you running a validator that might be complex for you you might get a little bit nervous but um for the network that's probably negligible there's it's not a point of failure for the network that you are um down for a minute which is not the case when you have big operators large uh stakers that are all under um one node for example and if

they go down uh the network can feel that so solo staking is a lot better than these big corporations capturing all of these validators capturing all of this ability to produce blocks and creating some sort of um centralizing point of failure of sorts now the state of nosis chain Des centralization um well it's not too bad we have 1,000 so 150,000 validators 2K nodes in 76 countries that doesn't tell us a lot but just for comparison uh we can compare it to ethereum where we have uh

700k validators 12K nodes and 25 counters so if we compare these numbers we can see that nosis chain is in a lot of countries and I think the nosis VIP program has a lot to do with it now how many of you are running validators nice wow that's that's that's a lot that's a lot I'm counting here uh nosis chain and ethereum right very well that's that's a lot of people guys this is the best public ever fantastic so okay so um where do you live I mean this is obviously biased because um we're in Germany so you probably live somewhere around Europe or close by um but yeah let's let's look at uh at how what that

means for people to be in the same spot so how many of you know what the Nakamoto coefficient is well if you don't just read uh and and nakam coefficient is the amount of entities that are required to compromise the network the reason why I was asking where are your validators or where are you based or where do you have these validators is because in nosis chain the Nakamoto coefficient is two remember when we talked about decentralization and we talked about political inference that means that if two governments decide to make nosis chain or blockchains or um like the the industry at large the website industry at large uh they need they want to attack it in

somehow we only need two countries we need Germany and the United States for nois chain and I'm afraid to tell you that for ethereum is just the United States in the first place and Germany in the second so we don't like the Nakamoto coefficient of ethereum is not a lot better than nosis chain it's exactly the same and it's the same two countries and those two countries are politically you know they're not that different they're all Western countries that that have a lot of uh policies together right so how did we get here we've decided that solo staking is the gold standard of decentralization um but Sol staking has his limitations we are promoting solo

Stak we're promoting with uh the nosis VIP we're promoting um with by with projects like DB node that try to make it very simple for people um to run nodes by themselves but but so has limitation these limitations are that most people that run validators end up being in the west why because disposable we wealth it's where there's more wealth in the west usually and where people can afford to take risks they have safety networks economic safety Network they can afford to invest in Risky technology like web 3 and all these cheeky things that somebody that is a little bit more stra for cash would basically hesitate to put money in um most of the

information is in English and we are educated in our schools in English so we have easy access to this information and we have trustworthy internet connections and power grids Etc so it gives us a lot more trust as well that we're if we put this into if we put our money into a validator we're not going to lose it because of an outage etc etc which we cannot say the same for some other countries now this is for solo saking but and then you you may think how about the pools and how about companies and how about like them well they are based in those countries right they are based in the west they're not going to help us out here they're not going to help solve and overcome these limitations by using traditional pools or traditional centralized exchanges for uh

decentralization or to try to promote decentralization in any sort of way uh let me do a little bit of an intermission now who the heck am I am why am I just blasting with decentralization right now well I am the CEO of dab node and at dab node our mission is to make it extremely simple for any of you to run a validator or any sort of note and we do that by offering you a UI with a couple of clicks and you can run these validators and these notes privately in your own hardware and without any technical knowledge uh DB note comes in two flavors you can buy a plug andplay machine literally a machine

that you plug into your router and it just magically works and you can deploy validated of whatever you want uh and for the most technical uh of you you can install free open- source software into your own machine and you don't have to buy the machine from us right so this is how it looks um this is how we make it easy for you to deploy a uh nosis chain validator you need to click here on choosing an execution client you can choose your consensus client you need to choose one of these three and then you'll need to install a web three signer to keep your your validating keys and then you click apply changes that's four clicks how many clicks do you need to

run a nosis chain validator that's right you've been listening fantastic but not only you can run nosis chain validators or Luxo validators or ethereum validators or Avalanche validators you can run like a whole plethora of daps that you can find in this dap store right here and this DB store is permissionless and open source so you you have an SDK so if you have an armagan chain for example um you can use our SDK and deploy your node and have it on the uh dap store as well okay so summarizing DB node is great for non-technical users everything is open source uh you can use our

permissionless SDK to enter our permissionless ecosystem and create your packages um it comes with a lot of tools that's why you would use lab note instead of instead of just a machine um and and bare metal because it it has a VPN where you can connect from wherever you are in the world and you can connect to your machine that's in your living room um it's great for uh P POS staking um it runs on very limited um uh hardware and it has an amazing community that you can go to if something goes wrong how are we related to nois chain for example because I was speaking with nosis chain how is speaking about decentralization how are we helping um no chain decentralization so onethird of

the validators according to the nosis chain validator survey oneir of the validators use DB nodes and if you look at the graffities of the um of the validators the graffiti is the field that you can just write when you run a validator um 12% of them have the default um graffiti that we have if you Deploy on DB node you can change it but the default will say the word dap node on it so 12% of the validators are running on dap note and this means that 12% of the validators at least 12% of the validators are in their own homes in different countries running with Hardware that they might have bought from us or they might have built

themselves so this is a great way of um like pushing the centralization forward because anybody from anywhere in the world can run AAP node right so we have an incentive program that is now stopped but it will come back um where we gave nosis chain is very very committed to the centralization so what they did is they give four validators four gnos for validators to every person that bought a DB node machine and the return on decentralization which is a concept that I just made up um is of 4.5x means that by giving people four validators they have bought or they have uh they're run they're now running 18 validators so they have bought on

average 14 validators themselves and added them to what nosis provided them okay um we're doing other stuff to uh help solo stakers like an M smoothing pool which puts people at the same level as uh other staking pools uh when it comes to me revenue and we can talk about this uh more later but let's go back to solo staking solo staking is what we've been promoting so much right um um but as we've seen it has limitations it it causes this centralization in these uh in these Western countries mostly because of the reasons that we have talked about but this doesn't have to stay like this I'm

here to present you the new framework for expanding decentralization beyond the capabilities of solo saking and this is community staking Community staking doesn't come from me Community staking is the perfect perfect storm brewing with a lot of different initiatives that are happening in the ecosystem number one what you need to run a validator is liquidity be it gno be it lyx be ethereum you need liquidity and we have many many protocols now like Stak wise Steakhouse etherly Lio that have like a bunch of v and they need to

put it to validate somewhere and they might want to put this to validate it in the centralized places because it's better for ethereum as a whole or for whatever Network it is as a whole um and they're just all working on decentralizing their node or node operator set now at the bottom we have communities there's a lot of communities organized around different blockchains and they are the ones that translate content they're the ones that can really bring the knowledge about web 3 into other countries into nonwestern countries by translating the documentation by making events by making

um like boot camps etc etc and they can also pull economic resources to put up front Bond bonds for example to participate in the permissionless OR de centralized node sets of these protocols that offer liquidity because remember communities let's let's just assume for now that what they don't have is this liquidity now how do you bridge this liquidity on an LSD Network like Lio let's take the biggest one and the communities that really want to run they have the capability of running this Hardware but they do not like how can they offer assurances to Lio that yes please give me these uh this eth and I will operate my notes and then I will get paid as well how can this happen

what's in the middle of these two software and Hardware and software and Hardware how many of you have heard about DVT there was a presentation before about DVT yes uh not so many okay yeah okay good good so DVT is basically a don't kill me Diva people but DVT is basically a multisig for validators this is a very very big simplification but it's a multi for validators it means that you can take a validator key break it down into pieces spread it out in different machines different pieces of Hardware different DB nodes Maybe and if one of these dab nodes is down it's not online it doesn't matter the

other three pick up the load it's like a multi you only need three out of four four out of five seven out of 10 whatever configuration you may and this is D.A for example who did a talk later uh before this is obal this is SSB um there's the diversity on the clients that you can use and all of this software can be run easily without any technical knowledge whatsoever by using a thing like DB note DB note also provides you with the hardware so the bridge in between these is something like d note now we have the full stack this is the full stack for Community staking

and it is not part of my imagination as I said I'm I did not invent this I'm just putting a framework together where it's easy to explain how it works but this is actually already happening there is an LSD Network called ether DOI that came to us in February and said hey we would love to put our e to validate but we don't want to go with centralized operators we want to have the centralized operators how can we do this and and we're like okay we can take care of the hardware bids and we're working with OBO already we we're working to integrate with Obel so you could have like Distributing this among different like well you see where I'm going and this is

already live this is already happening on ethereum not only this but there are a lot more projects coming up soon there's e a Latin American group that just set up yesterday another oal cluster using dab noes there is these two places in Africa that got a dab note granted by the ethereum foundation and this one in Nigeria is from DV stakers uh so more and more we're getting all of these all of these dab nodes out there all of this Hardware but remember I I just want you like I'm saying dab node a lot but I want you to remember that dab node dab node

itself is nothing dnote is just a ux crutch to run all of this software you can run a validator without dnote dab node just makes it easier so every time I say dab node I mean the pack the pack of the hardware and software which you can run by yourself the important thing is not to remember that DB node can do it dbde can obviously but the important thing is to remember the framework right the four stages and what we end up with this is we end up with communities that are spread all across the world they gain access to revenue on the base layer of web 3 by validating layer ones without speculation without defi they get a safe

entry to web 3 that pays for their honest work of validating the chain there is a low investment you need to invest on the hardware or like you need you do need to do some work in order to get paid and that helps redistributing this wealth and of course decentralizing the chains um one of the things that you can do is you can use very very low power this is what we're this is what we're working right now is want to touch on this very very briefly we're working on having this as a package of of uh Hardware that you can sell to a community you can get very low powerered Hardware like raspberry pies and a couple of bigger ones and you create

this cluster and you can have two of these machines failing before anything happens to the validator and you can get all of these as a product from us so if you're more interested in exploring this way for your protocol if you want to get the centralized validators let's talk later um and I just wanted to add this meme because I love it I made it s and I think that a lot of uh a lot of what happens with uh crypto a lot of the the bad things that happen with crypto is are on the speculation a lot of people are getting burned real bad going into web 3 trying to earn money on the wrong way and a lot safer way to bring people into creating actual value for the

network and at the same time earning money themselves is to participate in the consensus layer thank you very much let me know what you think about Community taking does anyone want to ask a question yeah there hi uh thank you for the talk uh could you explain a bit uh maybe very simple term so if I want to be a validator with the dep node do I need 32 e um no you don't um you can participate in some other protocol so in order to run a

validator by yourself you obviously need 32 e it's important to notice that an ethereum validator requires necessarily 32 eth per validator but you don't need to have them yourself you can use dab noes and you can use things like rocket pool and you will need to only put up a bond of eight eth and then rocket pool is the eth provider as we were saying in the framework as the e would provide the rest you can use you can even do it with four eth with Steakhouse you can put four eth up front and the steakhous protocol can provide the rest so yeah you don't necessarily need um 32 E I guess like followup question then if I commit less than 32 e if I make a

mistake or if my Hardware makes a mistake for some reason then the one who provides the rest of the liquidity will get slashed or like how does the risk correspond to my contribution to the 32 e that is St yes so so obviously you will put up uh you will put this Bond up front this four e this 8 eth they're nothing more like they could give you this e for free but they require you to put up some front so they have something to take if you do this work wrong so if you use something like DVT if you do something wrong nothing happens the rest of them pick up the work pick up the slack they do it well they do it properly nothing happens to you that's fine um if you're doing it on your own without any DVD without any cluster

without any multis as I was saying then slashes are very very very very rarely I don't think there's been any slash that was up to four e theoretically it might be possible lion is coming next he can tell you more about this but you will not lose everything but yes if you put up this this uh this Bond up front is so you can be slashed instead of the people that provide the eth but you also get Revenue out of it and it's extremely hard to get slashed if you don't actively try to do something malicious okay so unfortunately time is running up but you can for sure grab him outside and ask him more questions or if not join the dnote Discord and for sure

he'll be more than happy to answer thank you very much guys thank you so I know one minute so the next speaker is going to be exploring how to increase NOS exchange security going into the L2 world and this talk is given by DB owl oh sorry sorry DB lion so please welcome him hello everyone what a wonderful week

to be here so many beautiful faces and Friends hello everyone one so today I'm going to speak about the nosis chain and I want to do one question before how many people knew be please be honest that nosis had a chain raise your hands very good very good it's it's surprising how many people sometimes don't know this but cool so no chain it's a wonderful project that I'm passionate about I'm the for coordinator in CIP and today I'm going to focus on how can we improve the security of the chain and especially the bridge using this wonderful technology that has been coming from the L2

wall so just some background nosi started as XD being a POA connected to ethereum with a native Bridge we have added many more since then and since December we have done the merge very excited now we have a permissionless validator set so the security of the Native value is pretty good but the security assumptions today for the value that comes from ethereum still depend on multi- Bridges it's important to note that even if the permissionless set of the honest validators gets corrupted because the bridge operators run independent software they will still be protected but if you corrupt the bridge operators

bad things can happen so on the far end of the spectrum the end game of rollups like this is not what we have today unfor fortunately most of them have multi and fast upgrade mechanisms but let's imagine a happy future that's what you get with rollups you get a situation where even if everyone on the RAB site is corrupt and you can only trust one single party exists somewhere in the planet assist in the bridge you will always be able to get your money out no matter what this is awesome and why ethereum is going so hard into rollups right now so let's explore what will happen if we try to move a little closer there so I love

this table from matter laabs it's a bit old but very Illuminating we can see here how side chains if you can corrupt the brid set you can steal funds you can do bad things with rollups you cannot with optimistic you have this nasty withdraw delay but something we can work with and so explor exploring the middle ground between these two there is this very interesting solution called the validium where you sacrifice security by posting data somewhere else so if you can corrupt the data ability committee you can do bad things not as bad things but still put the state the network in a state that is corrupted and only the attackers can undo these things so they

can do Ransom and a lot of bad stuff so in nosis we are here multi like many other parties and can we do better could we ideally go to a place where we have this wonderful non-existing security assumptions where you only trust that somewhere someone is assisting the bridge and you can still get your money out well yeah L2 it's all about Bridge engineering and it always has been so Martin goelman proposed this construction some time ago to me and I've been exploring I think it's fascinating so I'm going to share it with you what if we had a validium that fall back into Z rollup Security in case of a problem so let's

explore that we have the nosis chain the beon chain as today validators are doing their thing they are doing blocks they are attesting they are finalizing the blocks and you take this finalized checkpoint and you throw it to L1 you have a consensus proof that shows that this is what 2/3 of the validator said agree is correct and a validity proof that shows that the state transition was done properly only then this submission is accepted to the L1 Bridge contract at that point a challenger window opens and someone can come and claim and dispute that this checkpoint ATT test to data that was not made available if that happens a dispute

period opens and the challenge can either fail if someone say the vators posts all of this data on chain proving to L1 that indeed this checkpoint was available or the Challenger the challenge succeeds with no one doing anything for the window and then this checkpoint is reverted the cool thing with this construction is that you will never ever have a situation where a checkpoint goes on chain that is either incorrect uncanonical or unavailable so you get around this like nasty situation with the bidum where they can corrupt the chain that's not going to happen to the cost of two things a dispute window

which affects ux significantly and this assumption that someone will challenge so this construction of optimistic availability in theory should not work this is why plasma failed at this time so why is this specific challenge sound first I want you to explain why data availability is hard the problem with data avability is that it's a non uniquely attributable fault and to explain why let's go quickly with this famous example from balic so we have case one where the proposer is malicious it publishes data that is not available so the Challenger has to say

hey not available but then immediately after the Challenger the proposer goes and publishes the remaining data that's case one and case two the publisher is honest but the Challenger is dishonest and with fully available data it also raises the alarm the problem here is that for an observer at time three you have no way of differentiating these two cases and this matters because this Observer is the bridge so you cannot go to the bridge and say who of these two is the malicious party so because you cannot attribute fault this situation is not economically stable if we had a case where the

Challenger had the expectation to make money out of a challenge it could just challenge all the time that like there is no tomorrow and money pump if it had the expectation of a stable economic it could just post challenges all the time forcing everyone into downloading all the data and having um uh bad Network it only works economically when the Challenger loses the problem here is that you need altruistic Behavior you need a challenger that wants to challenge for some reason even though it is going to lose so why in our construction why the

hell would the challenge the Challenger lose money well because in order for this challenge to be even possible you need to have a submission of something that is unavailable and finalized what means that not the whole but 2/3 of the nosis beon chain set got corrupted malicious or something really bad that is both very rare and something really worrying so if that was to happen there is a strong motivation for a challenger to come and save the chain because we would do something like social slashing or some mechanism some strong fork in order to recover control of the fork but

this would be both a rare event and also time bounded so this is what makes the challenge stable so now extending like Neo neoc column with this thing the penalty is that yes we have a withdrawal period but we don't have a situation where if the chain gets corrupted you can steal funds so I think this is very interesting we will explore it but it's not only this we can do so so much more like starting from a multi we could throw a throw prover and now even though we had a withd drawability delay The Operators could never steal fans which is much

much better if some team finally cracks the zkm type one um price we could throw it there and then we would have no withd drawability delay and the assurance that the bridge operators could not steal fans with this it would be even better because we would have both a permissionless set not pay data and not have a situation where a malicious set could could steal the funds so to to explore this idea further and I'm stealing the questions from you or you can just write this down and ask later why does this whole thing need the consensus

proof well this is important because otherwise the challenge would not be uh a unique event so the fact that it has to be finalized first reduces the the possibility of having this delay for the validity let me let me see here so for the validity proof the corruptor could steal the fans but here we would need them to have some fraud prooof construction so then the system is not as good but it also makes sense so for the consensus proof we could then opt out of having to prove the whole Pro

stake system because this is very very difficult like putting the whole Bon chain consensus the Casper finality gget in a proof is proven to be the very difficult there are teams working on this so we could have something first like some smaller DIC the problem is that having this intermediate layer would pretty much break the security guarantees that we want to have eventually and it would mean that we have to rely on a permission set again so this is something that we could have as a B1 and then as an end game go for the Full Construction with the proof of stake circuit construction another question for L2 Engineers is okay great this is side chain but is the state actually derived

from L1 or no well in normal operations no the scen would work autonomously and they would decide how to pack the block because data is not meant to be posted on chain unless that there is active censorship so to ensure that even if the Bator set gets corrupted they can exit we would have some mechanism like most raps do where there are Force inclusion transactions that you can submit to the bridge contract and is the bridge contract doesn't see these on the blogs that you post later then some emergency mode would be activated and that's what allows you to unwind all your positions

and exit from from the side chain SL rollup so is the emergency more recoverable I would say no we are researching if that could be possible but I think in this construction it will not because if we have to have a situation where the validator set got corrupted it doesn't make sense to basically return power to them so there has to be some intervention to change the consensus verifier circuit into accepting a new Fork so because of all of this something that would probably have to happen that is an important J consideration is that now all the L2 block producers would have to track L1 in order to include

these transactions I think we can optimize this way but it's another um thing to consider so this is basically the end game I was talking about but I want to give a huge shout out to the Hashi team from nosis where they are building this bridge implementation that would act basic as a multiplex into different types of bridges so what we could have today with krent technology is the krent native Bridge with Omni bridge and a Celestial Bridge together with the AL Cent so we would have the best of being safe against implementation bucks also having a proof of the consensus with the alter like client it's not as strong as

what we have we will have eventually with a full beon chain but is still much better than not having anything so what this would give as immunity against um correlated like uncorrelated bugs consensus takeover and I think they would we would have this ready I don't know how soon but it's very exciting and all of these constructions I'm talking about would probably be plucked into Hashi with different models so yeah to summarize the idea of the bidum with Z rollup we would remove all assumptions at the cost of having a withd drawability delay and this well capitalized challenger but yeah very excited very bullish thank you

so much question time anyone want to ask a question so we're there just one second that they bring you the mic hi um so uh I was just curious the price of tracking L1 is like at least double if not more compared um right nosis chain to uh ethereum like how are you going to convince the validator set that it's okay to increase their you know cost by 3x um for a maybe

Improvement like what's the like what's the Thought there yeah so I think you're talking about this potential requirement that L2 block producers will have to track L1 yeah exactly so really the the requirement here is that the deposit transactions will have to be included in L1 blocks within some time frame that would probably be like 12 to 24 hours so something we could do at the start is make sure that there is some entities that commit to including these transactions and as long as someone does it then we are good so not everyone needs tojust some or so everyone doing it gives you the maximum security Assurance because if no one is doing it uh then the like the chain SL rollup will fall into emergency mode and

basically kill lifeless so you want to make sure that that doesn't happen unless there is an accident but you can try to have like an maybe a happy mode where if these parties are doing it then no one else has to do it but there is still some mechanism that people will just step in and include these transactions if no one else is doing it awesome thank you sure any other questions no no questions now is the chance e no okay well thank you for coming and

thank you