[0] https://www.paradigm.xyz/2020/08/ethereum-is-a-dark-forest
[1] No clue if this has a different name in Ethereum
1. Every full node is part of this dark forest, maintains its own mempool, and gossips the mempool to others. You do not have to be a validator or miner to run a full node; just run an Ethereum client.
2. There are indirect economic incentives to 'watch the watchmen': a slashable staking violation that doesn't get slashed breaks the Ethereum security model, and is expected to be an extremely rare event (if it ever happens). With a network that has a market cap in the hundreds of billions; someone is watching and it only takes one to sound the horn.
I do agree that there probably will be altruistic validators in some cases, but the economic incentives work against them. The history of cryptocurrency has trended towards doing the minimum amount of validation work that satisfies network consensus[0]. It's entirely possible that the market just shrugs its shoulders and says that a violation of the Ethereum security model just isn't actually that bad. Consider the relative lack of concern over MEV[1] and automated arbitrage bots, and the fact that the valuation of the coin is entirely unconnected to any security issues it may or may not have. It may just wind up being the case that the network just... tolerates a handful of people getting screwed.
[0] For example, Bitcoin miners accept new blocks by literally joining other mining pools purely to steal their previous block hash. It's significantly faster than waiting for a full 4MB block to get P2P gossiped around the world, but the downside is that you can't actually validate any of the data in that block. This effectively means that miners aren't full nodes anymore, and the result has been several long chainsplits and reorgs whenever a softfork occurs.
[1] Miner Extractable Value
Following this logic, stakers themselves are incentivized to just run the software to submit a slashing tx themselves (free money), at which point just having stakers running slashing software is sufficient. And if they aren't someone else will submit it to the mempool.
Does it matter who does the slashing, as long as the incentive is enough to motivate doing it?
Ok, let me try ELI5ing it.
Let's say we have an economy where, in order to determine who owns what, people literally just make and publish a list of who owns what. Everyone trusts the lists. But what if someone decide to change the list so that it says they own someone else's stuff? Proof of Stake says that if someone wants to change the list - say, if someone traded something on the list to someone else - the page they add to the list also has to have some of their money taped to it. If that change turned out to be fraudulent, someone else can tattle on them, and then that someone gets the money taped to the list instead. So if you want to make sure you're reading from a not-fraudulent list, just check for the money taped to the page.
This all continues fine for a while. There's a bunch of people who maintain the list, all of whom have their own money taped to different pages of it.
One day, someone tries adding a fake transaction to the list. You, of course, notice it and tattle on them. Except in order to claim the funds taped to the list, someone else has to... add a note to the list saying you own them. And there's no reason why they can't just write down that they tattled instead of you, because the only proof that you were the one who tattled is getting it onto the list that you have to tape money to in order to add to. So the only people who have a reason to make sure the list is valid are the same people who are updating the list in the first place. Everyone else can tattle but they don't get paid for doing so, which was the the thing keeping the system secure.
As an interesting aside, this is essentially how the economy of the Yap islands in Micronesia worked until the 20th century, with large stones from another island changing 'ownership', while being left in place (because it was too hard to move them)[1].
Except it was an oral history instead of a published list!
It reminds me of the technique to remembering a book where you read one word at a time and repeat it out loud, repeating each segment + 1 in a loop. It’s quite trivial to remember every single word when doing that.
EDIT: Clarification - once a slasher posts the violation, who removes the ether?
In other words, the blockchain; in the same way that it's not _miners_ / stakers who process transactions on bitcoin or ethereum ; miners / stakers only decide _ordering_ but everyone who runs an Ethereum client is processing and verifying every transaction; the same way your browser checks a TLS certificate.
Thanks for your answer!
The value in a staking account is calculated on the blockchain as "amount staked minus slashing penalties", and this violation is automatically recorded as a slashing penalty, so the answer is "everybody"
edit: for an example. you get hacked and lose $100M. You say fuck it, submit a slasher report that says it wasn't a valid transaction. you offer enough money to get x% of validators to agree with you.
As far as I can tell, you cannot get slashed for your vote on a slash. So lying is ok.
That's not how this works at all.
Slashing happens under a very specific circumstance: a staker submits contradictory messages. Those circumstances are testable with built-in code that's part of the protocol. To get someone slashed, you send a transaction including their contradictory signed messages. When your transaction is included in a block, the staker gets slashed by the protocol rules hardcoded in all the consensus clients.
The only other thing that can cause a staker to lose stake is the "inactivity leak," where an active staking node doesn't send the messages they're supposed to send. That's completely automatic.
You are basically stating that slashing is impossible in certain conditions because network is not censorship resistant.
There is one avenue where network can censor. It is a 51% coalition that orphans blocks that contains slashing txes. This coalition is dealt with UASF (user activated soft fork), since this type of behavior goes against core principals of the network and convincing people to do it will be really easy.
That's not what slashing is supposed to be used for, but if that situation happened again, Ethereum would fork again, just as last time when Ethereum classic didn't agree to freeze the Ether from the DAO hack. PoS makes it a little easier to fork (which is good imo), but doesn't change anything fundamental. Everyone still needs to be in complete agreement about the rules and history for Ethereum to work.
Validators are run by people who fully control if a transaction is valid or not. You either need a ton of GPUs (currently) or a ton of money to have tangible influence over translations.
This isn't even a hypothetical, there's a few massive wallets that are hoarding a ton of eth that will be given more power from the POS transition.
We're relying on "the goodness of their hearts" validator operators and crossing our fingers validators run the same software with the same rules.
Even if you call out sketchy transactions that are close to 50/50 consensus, nothing will happen unless a ton of people have a ton of money on the line like the DAO split.
We need more discussion on how incentives of each party should be to give the most stable network possible.
It's not as if they're automatically given more power. Such hoards of ETH would need to be deposited in units of 32 ETH to activate unique validators. You could have a large number of validators that are actually a single computer program participating in the Beacon chain, but that doesn't make too much difference.
At the bottom layer, we're talking about the application of an open p2p protocol on the Internet. People can and will analyze the traffic for that protocol, and it will be possible to identify rough shapes and sizes of players in the network. And such analyses won't be long in coming to public blog posts, etc. following the Merge.
If decentralization in the network seems at risk, there will be efforts to remedy the situation. Whether they can succeed is another question.
I would suggest to stop spamming the HN comment section and read the introductory articles people helpfully linked you to.
Ad hominem is "you are wrong because you (fill in the blank)". It is not "go read the articles given to you".
"You are wrong because you are an idiot" is ad hominem.
"You are wrong" is denial.
"You are an idiot" is insult.
It's easy enough not to reply. No need to get an attitude about it.
> Is it incorrect to say that ethereum is now entirely centralized with some extra steps?
> Like, you have this proof of stake thing, but the only reason it works is because there's just a small number of validators, which is just going to be the ethereum foundation and friends.
I know Cunningham's Law is a valid discussion strategy, but the topics of cryptocurrency on HN already tends to attract enough flamewars and misinformation as it is.
There's nothing here that was done in bad faith and I should not need to defend myself for asking a question in a tech forum. Assuming I'm not asking in good faith is bad faith.
The reason I asked was a description pasted a short while ago:
https://news.ycombinator.com/item?id=32535409
https://news.ycombinator.com/item?id=32535912
Which included this line:
> Slashing is not meant to profitable, and the whistleblower reward is quite small. We don't need a million slashers, in fact, we could operate with just one... expect the Eth Foundation to run them, among other large players who can spare the resources.
Which sure sounds like a decentralized process that is ultimately just centralized around the ETH foundation at the end of the day.
Honestly I've learned a lot from the responses here. And I think people who assumed I was doing anything other than just asking questions because the idea I was asking about offended them are asshole. So yeah. Go pound sand.
The validators need to be decentralized (i.e. prevent "harmful collusion"), but the slashers don't need to be in the same way (as long as the validators are).
It is not the case that only the ETH foundation can slash, which was the crux of my original question.
The fundamental misunderstanding people seem to be having is that slashers show objective proof of bad events. That's accurate. But validators are still free to agree or disagree with that objective proof of bad events. If you can create a means to prevent consensus on slashing for your overtly malicious behavior, your stake is only at risk if the entire community agrees to fork, which is probable for huge malicious behaviors but I'm not convinced is true for smaller things or circumstances where large actors have a vested interest in preferring the original chain.
In this context, what it means is that a person posted conflicting validation messages on different parts of the network, and anybody who can show the existence of two such conflicting messages can post it to the blockchain, receive a reward, and the offending validator gets slashed.
(There are also other ways you can get slashed, read the POS documentation if you want to learn the details) All methods of slashing are fully decentralized.