Having all MEV relays connected to the validator is already a widespread industry practice. Every operator utilizes it to collect more bids and extract more MEV rewards. But is it maximum?
The team at P2P.org constantly explores new opportunities and technologies to increase staking yield. We are thrilled to announce that we have made a step forward to MEV maximization, allowing our clients to extract an additional 10% more from block rewards.
Let’s dive into how our team has been able to achieve this as one of the first staking validators in the industry.
The validator has four seconds from the beginning of its slot to create, sign, and propagate the block to the network. By default at 0.0 sec validator requests bids from connected MEV relays, waiting some time for response, chooses the most profitable one and sign it.
But what if some builder finds a new MEV opportunity with a higher bid a little later than the start of the slot? Likely, validator will lose this opportunity.
We observe numerous examples when bids increased drastically during the first seconds of the slot. There are cases when the bid has risen from 0.05 to 300 ETH. Charts below demonstrate it.
Let's delve a bit deeper to understand why builders increase their bids over time. The general reasons are as follows:
Several examples illustrate these points:
Historical data shows that waiting more time before requesting MEV may increase block rewards up to 15% on average.
However we can’t delay the MEV request too much for two reasons:
Speaking about the second point, the plot below shows that 95% of blocks utilize bids submitted before 1.1 sec. Having that, we have about 0.1% reorgs currently. Increasing MEV requesting delay too much may increase the number of reorgs drastically.
P2P.org team has conducted enhanced experiments and infra optimisations to find a golden mean between maximizing block rewards and staying healthy for the network (not producing missed or late blocks).
This allowed us to roll out the MEV Maximizer feature for our clients, the first of its kind in the industry.
MEV Maximizer feature allows validators to catch larger MEV rewards. Chart below demonstrates a few examples of the block rewards increase for the particular slots:
It's fair to mention that not every block shows such a significant increase in rewards, and the 10% growth is valid for a large number of validators in the long-term. A client with only a few validators due to a low number of proposed blocks may be unlucky and receive zero increase, or conversely, they may receive an extra-large MEV of 10 ETH or more.
Speaking about yield, block rewards (or execution rewards) account for 30% of total rewards, increasing APR by
10% x 30% = 3% from 4.20% to 4.33% currently. So, if you have 250 validators, you can expect to receive an additional ±10 ETH in rewards per year, the calculations are the following
250 validators x 32 ETH x 0.13 % extra APR .
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<p></p><h3 id="intro">Intro</h3><p>We’re thrilled to announce our collaboration with SSV Network, marking the inception of our <strong>DVT Staking API, the first of its kind in the industry</strong>.<br>This initiative seeks to amplify our institutional staking offering further, ensuring seamless integration for custodians, wallets, and cryptocurrency exchanges.</p><div class="kg-card kg-button-card kg-align-center"><a href="https://bit.ly/3SQpuC4?ref=p2p.org" class="kg-btn kg-btn-accent">Book a demo now!</a></div><p><br>Since 2018, our mission has been to create a secure and efficient platform to onboard institutions for non-custodial staking solutions, particularly within the Ethereum ecosystem. Fast forward to 2023, our operations now extend over 50 networks, managing staked assets close to $2B with over 60,000 delegators. The unveiling of the DVT Staking API is another significant milestone in our ongoing journey, embodying our commitment to foster non-custodial staking at the institutional level.</p><h3 id="whats-dvt">What's DVT?</h3><p>Distributed Validator Technologies (DVT) is pivotal in mitigating staking risks, offering a robust framework for managing digital assets and staking strategies. The resonance of DVT among institutions is profound, given its prowess in addressing key concerns such as counterparty and slashing risks, which are crucial in ETH Staking.</p><figure class="kg-card kg-image-card kg-card-hascaption"><img src="https://p2p.org/economy/content/images/2023/11/pic-what-is-dvt.png" class="kg-image" alt loading="lazy" width="600" height="496" srcset="https://p2p.org/economy/content/images/2023/11/pic-what-is-dvt.png 600w"><figcaption>DVT, or Distributed Validator Technology by SSV.network explained</figcaption></figure><p>For an in-depth understanding and integration guide, we direct you to our staking API <a href="https://docs.p2p.org/?ref=p2p.org">developer guides</a>. The DVT Staking API is engineered for simplicity, offering a streamlined workflow to accommodate the diverse needs of custodians, wallets, and neo-banks. Our API acts as a bridge, simplifying the navigation of DVT staking and ensuring a seamless transition into decentralized staking. Our mission is to facilitate integration and offer cost-saving benefits to users who integrate with us.</p><h3 id="the-integration">The Integration</h3><p>The integration of DVT with our platform paves the way for a new era of Ethereum staking. Our platform provides a unique opportunity to stake directly with multiple institutional node operators, such as Allnodes, Stakely, and HTX, offering their own nodes operating on DVT. This initiative enables institutions to harness the full potential of decentralized staking through various experienced operators, each bringing a wealth of experience working with institutional entities, high-performance nodes, and best-in-class security practices to ensure node liveness. Our coordinated effort ensures a geographically distributed node operation with one node in the US, two in the EU, and one in APAC, significantly mitigating the risks associated with downtime due to country-specific incidents. Moreover, by supporting a broad spectrum of execution and consensus clients, we foster Ethereum client diversity, further eliminating reliance on the point of failure. This well-rounded approach significantly elevates the robustness and reliability of the P2Porg staking platform. It underscores our position as a leader in advancing the staking paradigm alongside industry leaders who share our vision.</p><p>Allnodes Founder & CEO Konstantin Boyko-Romanovsky told P2P.org, "Allnodes is dedicated to advancing the staking ecosystem, and our partnership with P2P.org through their DVT Staking API aligns with our commitment. We believe DVT represents a significant step forward in mitigating inherent staking risks like slashing and counterparty exposure - paramount concerns for ETH staking. The DVT framework complements our mission to deliver secure and efficient staking to institutions. By collaborating with P2P.org, we can integrate their healthy platform and progressive technology to benefit clients through a decentralized, resilient staking infrastructure. Our partnership is about more than enhancing our services; it's about shaping the future of institutional staking and contributing to a more secure, decentralized blockchain ecosystem."</p><p>Stakely Co-founder Ignacio Iglesias said, "Stakely's collaboration with P2P.org, employing Distributed Validator Technology (DVT) in the Ethereum staking ecosystem, marks a pivotal advancement towards a more secure and decentralized staking infrastructure, specially tailored for institutional clients. DVT aligns with our commitment to providing robust, non-custodial staking services for institutions by mitigating risks such as slashing and single-point failures through distributed key management. This approach ensures security and reliability and fosters decentralization by utilizing diverse Ethereum clients and operating across various geographical regions, further strengthening the resilience and integrity of the Ethereum network."</p><p>The Head of HTX Web3 Technology, Token Xi, stated: "HTX staking is committed to advancing the overall ETH stake ecosystem towards greater security and decentralization. Our collaboration with P2P.org in developing DVT StakeAPI aligns with our expectations for the positive growth of the entire industry ecosystem. As a deep partner of the official SSV, HTX has long supported the development of SSV, from testnet to mainnet, as a core validator node operator. Through the SSV network, we have reduced the risk of single points of failure, thereby better securing our users' assets. Additionally, the decentralized nature of SSV allows our users to enjoy the safety benefits of decentralization while promoting the decentralization of the entire ETH ecosystem."</p><p>Our collaboration with the ssv network has been long-running; as one of their Mainnet Verified Operators, we've been working closely with the ssv network to redefine Ethereum staking with the integration of DVT into the P2P.org platform via our new Staking API thanks to a grant awarded to us. The ssv network grant has been instrumental in developing and launching the DVT Staking API to advance institutional staking solutions at P2P.org. This integration propels our value proposition to institutional investors, framing us as the go-to platform for a diverse suite of staking services. You can learn more about our work as a Mainnet Verified Operator with an ssv network <a href="https://p2p.org/economy/p2p-org-joins-ssv-network-as-mainnet-verified-operator-enhancing-ethereum-staking-with-dvt/">here</a>! </p><p>The ease of integration and cost-efficiency is at the core of our DVT Staking API. It is not merely about staking; it's about creating an ecosystem that is accessible, secure, and beneficial to all stakeholders involved. Our API is designed to save substantial time and resources, accelerate your product offerings, and propel your business toward its staking goals. Our customer-centric dashboard allows you to effortlessly retrieve all the necessary information, consolidated within a user-friendly interface and real-time reporting.</p><h3 id="contact-us-and-use-it">Contact us and Use It!</h3><p>If you'd like to discover more about the ease of integration for our DVT Staking API, you can find more in our documentation portal, <a href="https://docs.p2p.org/docs/ssv-overview?ref=p2p.org">here!</a></p><p>You can also contact a team member via our official Telegram account or book a demo and learn more about the DVT Staking API <a href="https://p2p.org/products/dvt?ref=p2p.org">here</a>!</p><figure class="kg-card kg-image-card"><img src="https://lh7-us.googleusercontent.com/FyQCPepMu-ZbuWid1vdUZAGq_-WgY6NBap5FsoZDT22Dgw7Ry5XUETHdm_KAVIDqvVFPCZgf8WEHf_11jGQlF1qDxrI_7JLUVRIe2SFZobJcgEOwJJN9NMqOCqgnZOlHNGOkkXTUH4tQRB5UrctHzzo" class="kg-image" alt loading="lazy" width="602" height="385"></figure><p>The DVT Staking API is a testament to our relentless pursuit of innovation, redefining the contours of institutional staking. We welcome all institutions and businesses to leverage this novel Staking API to meet the demands of your current staking strategy and be well-prepared for tomorrow's decentralized landscape.</p><p>For further inquiries and discussions, feel free to reach out to us. Our team at P2P.org is here to assist you in every step of your staking journey.<br>Official P2P.org Telegram Channel: <a href="https://t.me/P2Pstaking?ref=p2p.org">https://t.me/P2Pstaking</a></p>
<p>Firedancer's testnet launch was announced at Solana's Breakpoint conference, marking a significant milestone in Solana's journey toward global adoption. Let's explore its purpose and understand why it is essential to transition towards multiple validation clients, thereby enhancing network security and stability.</p><h2 id="benefits-of-multiple-validation-clients"><strong>Benefits of Multiple Validation Clients</strong></h2><p>Generally, any PoS network would like to have more than one client, and clients must be developed by independent teams using different programming stacks because of security and stability matters. The Proof of Stake (PoS) network will benefit from two separate validation clients. Still, the benefits will increase with more clients and more evenly distributed stake among them.</p><p>You may wonder what number of validation clients are counted as decent for the PoS network, and this is an excellent question. We believe resilience and reliability are the most important things for the Solana ecosystem. From that perspective, the Solana cluster must "survive" the outage of one validation client, which means there should not be more than 33.3% of stake on each validation client because if there is more stake, it will cause a halt of the cluster because of BFT consensus. Thus, the mandatory condition to sustain the outage of one validation client is to have four clients in the cluster with ~25% of a stake each (again, it should not be more than 33.3%). To secure the network, the cluster must have a fairly distributed stake across all available validation clients. It looks like a challenge to achieve this for different reasons.</p><h2 id="solana-validation-client-diversity"><strong>Solana Validation Client Diversity</strong></h2><p>Currently, the Solana ecosystem offers 2 production-ready clients:</p><p>1. Solana labs client (<a href="https://github.com/solana-labs/client?ref=p2p.org">https://github.com/solana-labs/client</a> )</p><p>2. Jito Labs MEV-enabled client (<a href="https://github.com/jito-labs/client?ref=p2p.org">https://github.com/jito-labs/client</a>)</p><figure class="kg-card kg-image-card"><img src="https://p2p.org/economy/content/images/2023/11/firedancer-2-A.jpg" class="kg-image" alt loading="lazy" width="2000" height="1125" srcset="https://p2p.org/economy/content/images/size/w600/2023/11/firedancer-2-A.jpg 600w, https://p2p.org/economy/content/images/size/w1000/2023/11/firedancer-2-A.jpg 1000w, https://p2p.org/economy/content/images/size/w1600/2023/11/firedancer-2-A.jpg 1600w, https://p2p.org/economy/content/images/size/w2400/2023/11/firedancer-2-A.jpg 2400w" sizes="(min-width: 720px) 720px"></figure><p>Although Jito Labs is an independent team, technically, the Solana client built by Jito represents a set of patches applied on top of the vanilla Solana Labs client. Currently, <a href="https://reports.p2p.org/superset/dashboard/jito_client_adoption/?native_filters_key=AcrJWCtZSXOF6QXvAhpOh5FKzgWiav7bjqfwzV8ipRkPiiXMKTAQ58DAKmfRKb7h&ref=p2p.org">42.5% of the stake is working on the Jito client</a>, which already includes two clients and two teams, which undoubtedly increases efficiency. However, both clients will be affected by almost the same set of bugs, including security vulnerabilities of the Rust compiler and Rust dependencies used for building the executable binaries. This situation is undesirable for the Solana ecosystem, which is heading to get its place as a PoS network ready to run world-level enterprise applications!</p><h2 id="introduction-of-firedancer">Introduction of Firedancer</h2><p>A new client for Solana called Firedancer was announced in 2022 and made a splash in Breakpoint 2022 when Firedancer engineering team lead Kevin Bowers from Jump Trading presented Firedancer, working progress, and exciting insights regarding performance optimizations applied in Firedancer. Let’s quickly review the high-level attributes of Firedancer:</p><p>- Written in C language</p><p>- Client development funded and guided by an independent company (Jump Trading/Jump Crypto)</p><p>It must be mentioned that Firedancer is designed to be highly efficient in utilizing hardware at 100% and, as a result, to bump TPS up to 1M (which is frankly insane).</p><p>Considering everything we discussed above, it is fair to say that Firedancer will be the first genuine new client developed from scratch by an independent team. Once it’s released, it secures the network significantly. For example, suppose there is a bug discovered, a security vulnerability, or performance degradation related to the Solana labs client; the validators can agree to move temporarily to the Firedancer client to give time to Solana labs to troubleshoot the problem and provide enough time to make a well-tested patch. Having several validation clients gives more opportunities to provide decent service for end users, so we strive to see Firedancer adoption in the Solana cluster.<br></p><p>*Authors: Anton Yakovlev Lead SRE @ P2P Solana team*<br></p>