Remote Staking with Economic Safety

• URL: http://arxiv.org/abs/2408.01896v1
• Date: Sun, 4 Aug 2024 01:39:06 GMT
• Title: Remote Staking with Economic Safety
• Authors: Xinshu Dong, Orfeas Stefanos Thyfronitis Litos, Ertem Nusret Tas, David Tse, Robin Linus Woll, Lei Yang, Mingchao Yu,
• Abstract summary: Proof-of-stake (PoS) blockchains require validators to lock their tokens as collateral, slashing these tokens if they are identified as protocol violators. In this paper, we present the first known remote staking protocols with guaranteed optimal economic safety.
• Score: 9.685926828113631
• License: http://creativecommons.org/licenses/by/4.0/
• Abstract: Proof-of-stake (PoS) blockchains require validators to lock their tokens as collateral, slashing these tokens if they are identified as protocol violators. PoS chains have mostly been secured by their native tokens. However, using only the native token upper-bounds the value eligible for staking by the market capitalization of the native token. In contrast, the remote staking of another crypto asset from a provider chain provides an avenue to improve the consumer chain's economic security. In this paper, we present the first known remote staking protocols with guaranteed optimal economic safety: whenever there is a safety violation on the consumer chain, at least one third of the provider's stake securing the consumer chain is slashed. To achieve this goal for a broad range of provider and consumer chains, two independent contributions are made: 1) a remote unbonding protocol that ensures slashing before the stake is unbonded on the provider chain if there is safety violation on the consumer chain; 2) a protocol to slash stake even without smart contracts on the provider chain. The remote staking protocol is analyzed and implemented in the case where the provider chain is Bitcoin and the consumer chain is a Cosmos SDK chain running the Tendermint consensus protocol.

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