Author: Josh O'Sullivan, CoinTelegraph; Translated by: Wuzhu, Golden Finance
As Ethereum prepares for its Pectra upgrade in early 2025, a recent research report from Liquid Collective and Obol reveals a variety of associated risks.
The report highlights the importance of client, operator, and cloud diversity, as well as concerns about limited adoption of distributed validator technology (DVT).
Matt Leisinger, chief product officer at Alluvial, the software development company behind Liquid Collective, said in an interview:
“Our latest report with Obol highlights the growing importance of addressing risks and protocol-level penalties associated with Ethereum staking.”
Customer and operator risks
Regarding consensus and execution clients, the report warns that “significant errors in major clients” could lead to “significant slashing penalties and network instability.”
As a fundamental element of Ethereum’s consensus mechanism, staking through a single node operator can expose staked assets to downtime and slashing risks.
Regarding staking, the report warns that “carrier diversity is critical to maintaining network health and avoiding single points of failure.”
Leisinger reinforced this statement in the report, stating: “Each staker and service provider must rigorously evaluate correlation, diversity, and risk mitigation measures to protect against potential risks, even from trusted node operators.”
The report also critically discusses the need for validators and cloud providers to be geographically widespread, citing “recent outages such as those at Hetzner and AWS.”
It explains that DVT can significantly support this strategy by “increasing the resiliency of validators by reducing associated risks.”
A geographical map of Ethereum validators supporting the Proof-of-Stake consensus mechanism.
Leisinger added:
“To achieve long-term resilience and institutional adoption, staking configurations must prioritize diversity among node operators and validators.”
Pectra Upgrade
The upcoming Ethereum Pectra upgrade combines the Prague and Electra upgrades, which focus on changes to the network execution and consensus layers, respectively.
Petra is expected to go live in the first quarter of 2025 and will include Ethereum Improvement Proposal (EIP)-7251.
According to the report, “The Pectra upgrade will allow stake providers to consolidate their stake across fewer validators by increasing the maximum effective balance to 2,048 ETH.”
The change in staking limits will reduce the number of validators required and relieve pressure on Ethereum’s communication layer.
