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Running a small validator is much riskier than being a small miner. If you're running a validator and have network downtime or any operational issues, you risk

Running a small validator is much riskier than being a small miner. If you're running a validator and have network downtime or any operational issues, you risk losing funds (the inactivity leak[1]). If you're mining and you have downtime, your only downside is the opportunity cost of not mining any blocks while you're offline. [1]: https://eth2book.info/altair/part2/incentives/inactivity https://eth2book.info/altair/part2/incentives/inactivity

exo762 4y ago
Inactivity leak for a solo validator going offline is very cheap, and it is by design. People are expected to run validator nodes on home connections and be profitable.
thesz 4y ago
One of the attacks on PBFT protocol is to split network in half, send block to one half, do not send anything to other half and the proposer wents offline and restore connectivity between the rest of the nodes. In that case, without any stakes, half of nodes will be locked to NIL, half - to a valid block. In case of stakes, byzantine proposer (it is only one node that is really byzantine, but it can control how network is split) can partition network according to a proportion of stakes, so that neither half gets prevalence. The algorithm in the link you provided does nothing in that case. The only node that will be punished is a byzantine validator which does not care. The system will be in no-progress-possible state indefinitely.
drog 4y ago
No. Inactivity leak is an emergency measure to restore liveness when the network stops finalizing blocks. It happens when >33% of validators are offline(WW3 scenario), major bug in widespread implementation, etc. Your link explains that. ETH2 is friendly to home stackers - you may lose some profit by being offline sometimes, and in the worst case minor penalties are applied. EDIT: If you are interested in a much better description of what happens if you are offline, see this: https://eth2book.info/altair/part2/incentives/penalties https://eth2book.info/altair/part2/incentives/penalties Some points from the link: - penalties =/= slashing - If you are online > 42.5% of the sime - you are earning profits
landemva 4y ago
And the opportunity cost of the funds used to purchase (er, stake?) the expensive ASIC which loses resale value. Acres of silicon boat anchors. In PoS you still have the staking tokens.

exo762 4y ago

Inactivity leak for a solo validator going offline is very cheap, and it is by design. People are expected to run validator nodes on home connections and be profitable.

thesz 4y ago

One of the attacks on PBFT protocol is to split network in half, send block to one half, do not send anything to other half and the proposer wents offline and restore connectivity between the rest of the nodes. In that case, without any stakes, half of nodes will be locked to NIL, half - to a valid block. In case of stakes, byzantine proposer (it is only one node that is really byzantine, but it can control how network is split) can partition network according to a proportion of stakes, so that neither half gets prevalence. The algorithm in the link you provided does nothing in that case. The only node that will be punished is a byzantine validator which does not care. The system will be in no-progress-possible state indefinitely.

drog 4y ago

No. Inactivity leak is an emergency measure to restore liveness when the network stops finalizing blocks. It happens when >33% of validators are offline(WW3 scenario), major bug in widespread implementation, etc. Your link explains that. ETH2 is friendly to home stackers - you may lose some profit by being offline sometimes, and in the worst case minor penalties are applied. EDIT: If you are interested in a much better description of what happens if you are offline, see this: https://eth2book.info/altair/part2/incentives/penalties https://eth2book.info/altair/part2/incentives/penalties Some points from the link: - penalties =/= slashing - If you are online > 42.5% of the sime - you are earning profits

landemva 4y ago

And the opportunity cost of the funds used to purchase (er, stake?) the expensive ASIC which loses resale value. Acres of silicon boat anchors. In PoS you still have the staking tokens.