ETH Staking Startup ssv.network Raises $10M as Ethereum ‘Merge’ Inches Closer

Project leads say they want to “mitigate” the biggest vulnerabilities in centralized staking.

AccessTimeIconFeb 8, 2022 at 3:00 p.m. UTC
Updated May 11, 2023 at 6:38 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Ethereum’s shift to a staking-based consensus mechanism has highlighted the influence centralized providers might wield over the decentralized network. In turn, developers are racing to build infrastructure that might avert such an outcome after the network’s so-called “merge.”

Ssv.network, one such effort, said Tuesday that it had amassed $10 million to fund development of decentralized staking infrastructure. Its focus is on deploying “secret shared validators” that fragment control of the network’s validators between multiple nodes.

At the time of writing, ssv.network’s testnet touted 2,661 operators and 7,954 validators with 254,528 ETH staked. Their collective effort powers an open-source network that project backers claim will “mitigate” the biggest vulnerabilities in centralized staking.

For example, client concentration continues to be an issue on the Beacon Chain, with over 68% of validators running Prsym as their consensus client. Large staking pools like Coinbase and Kraken have inadvertently increased client concentration and left the proof-of-stake chain susceptible to potential chain splits, correlated slashing and finality issues down the road.

“SSV fits into what we call layer zero, which is basically what secures Ethereum,” core contributor Alon Muroch said in an interview. “I think it’s very important that a lot of people care about it, because they want to keep Ethereum decentralized.”

It also gets at some of the less-visible realities of the Eth 2 staking landscape. It’s easy enough to see that big fish like Kraken and Coinbase represent a considerable percentage of staked ETH. Less prominent is the fact that validator client Prysm has around 70% market share.

Still, the biggest fish aren’t missing the boat. Coinbase, Lukka and OKX are among ssv.network’s backers, as is Digital Currency Group (CoinDesk’s parent company).

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.

Danny Nelson

Danny is CoinDesk's Managing Editor for Data & Tokens. He owns BTC, ETH and SOL.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.


Read more about