Strengthen DeFi's security with "Distributed Validator Technology" from Obol Labs.

Discover how "Distributed Validator Technology" (DVT) can be applied to Ethereum with "Obol Labs." REDeFiNE TOMORROW 2023 hosted a discussion with Collin Myers, CEO and co-founder of Obol Labs, and Unnawut Leepaisalsuwanna, Venture Builder of SCB 10X.

Colin Myers initially proposed Obol Labs, a platform whose development team builds the Obol network. By December 30, 2022, Charon had been applied successfully to the Ethereum Mainnet via middleware (software that supports the main system). Afterwards, it developed DVT according to its roadmap.

What is Distributed Validator Technology?

A validator is currently a high-risk mechanism that operates independently using a single set of approved public and private key codes. On the other hand, DVT, a key-sharing technology that distributes keys to many different places, helps spread the risk and verify numerous individuals, enhancing security and providing support for the decentralization concept.

Another way of improving the security of validators is to use decentralized technology that distributes responsibility for crucial items. Further, multiple signatures are necessary to close any gaps in a single damage and give validators greater flexibility.

Moreover, Myers observed that liquid staking combined with DVT had supportive properties. DVT facilitates decentralization, prevents potentially harmful behavior, and considerably lowers the risk of single validation in liquid staking pools.

Highlights and difficulties for Obol in implementing DVT 

Myers explained that Obol Labs' DVT was created as middleware rather than as a replacement, enabling users to use DVT while utilizing any Ethereum services. It serves as a supplementary solution for current clients or services. More importantly, it reduces the likelihood of middleware operating alone.

As well as offering individual usage, Obol is entering its beta phase. This platform is designed to serve as a bridge between users and liquid staking platforms and authorities, offering a wide variety of features. These factors hinder usage in a larger area. The next stage is to get past the difficulty of communicating with other parties and convincing people that the technology works, like in Obal's plan to switch from a home validator to a business-to-business (B2B) system. In the meantime, communicating with the centralized system community is the challenge.

An overview of Regulations, Supervisions, and Impacts on DVT

Myers stressed the difficulties in complying with US regulations, which are viewed as ambiguous and unsupported at the moment. Due to Obol's US-based users and investors, he focused on concern management to promote DVT's growth. It would offer a lot of potential benefits to users, like the ability to use validator nodes in various countries. Unnawut agreed with him regarding the benefits of DVT, which enables investors to securely engage in staking and other asset classes.

Recently, staking companies that require risk management and insurance companies have shown a lot of interest in Obol. These are crucial use cases that support DVT adoption and implementation.

DVT's ability to minimize validator risk makes it appealing to insurance companies, providers of various insurance products, and larger businesses.

Does DVT impact other service providers in the market?

According to Myers, the industry gains from the variety of staking platforms that are available today. Some teams have already used DVT and produced unique benefits. He clarified that DVT could be used with a wide range of staking services, such as liquid stake pools, centralized validators, at-home validators, and even the most recent DeFi use cases, and that it was more of a market reinforcement than a competitor. DVT is an addition to the current offerings and has the potential to lower costs while boosting service security.

A centralized validator, for example, has distinct product features, and its user base is accustomed to the system, which requires a reliable or well-known medium. These service groups are trying to use DVT in an effort to save expenses and boost security.

Obol and the DVT application in other ecosystems.

In addition to having spent a significant amount of time in the Ethereum ecosystem, Obol Labs has researched and conducted experiments in the Cosmos ecosystem to determine the suitability and general overview of the industry. It investigated DVT's compatibility with various cryptographic patterns and looked for potential use cases within the Cosmos network.

Watch more on YouTube at Obol Labs & Bringing Distributed Validator Infrastructure to Ethereum

This article summarizes the virtual conference held in May 2023.