Vitalik Buterin (Ethereum Co-founder) – Decentralizing the Builder Role (Sep 2022)

Chapters

Abstract

Exploring the Future of Ethereum: A Comprehensive Analysis of Distributed Builders and Blockchain Architecture

Abstract:

Ethereum stands at a critical juncture, embracing distributed builders and introducing transformative block architecture. This article delves into these concepts, exploring their potential impact on the network’s efficiency, security, and decentralization. We examine the roles and implications of various components, including proposers, builders, searchers, and aggregators, within this emerging framework. By analyzing technical feasibility, market viability, and potential challenges, this discussion provides a thorough understanding of the future directions of Ethereum’s blockchain architecture.

Introduction to Proposer-Builder Separation and Its Impact on Ethereum

Proposer-Builder Separation (PBS):

The concept of Proposer-Builder Separation (PBS) introduces a dual role in block creation. Builders construct candidate blocks and gather transactions, while proposers accept bids to ensure block inclusion. This separation aims to optimize transaction processing and Maximal Extractable Value (MEV).

Decentralizing Builders:

While PBS enhances validator decentralization, it risks centralizing builders. To prevent a single entity from dominating block production, strategies like transaction inclusion lists and partial block auctions are suggested. However, these may not fully resolve the issue.

Technical Feasibility and Market Viability:

Decentralizing builders is technically feasible, but their market competitiveness against centralized counterparts remains uncertain. Despite potential inefficiencies, decentralized builders could offer unique advantages.

Builder-Searcher Architecture and Trusted Hardware Solutions

Builder-Searcher Architecture:

Proposed by Vitalik Buterin, this architecture decentralizes block construction. Searchers create transaction bundles, and aggregators assemble the blocks. Challenges include MEV stealing prevention, encrypted bundle combination, and safeguarding against aggregator-proposer collusion.

Trusted Hardware Solution:

Trusted hardware modules (TPMs) offer a solution by enabling secure bundle encryption and aggregation, preventing collusion and ensuring proposer commitment.

The Role of Attesters and the M of N Assumption

Attesters:

Attesters and proposers play a crucial role in signing block headers, with the aggregator releasing the block upon TPM verification.

M of N Assumption:

The distributed aggregator model relies on a threshold of honesty, assuming a majority of nodes operate with integrity.

Post-Dank Sharding Block Creation and Data Availability

Block Creation Post-Dank Sharding:

After Dank Sharding, block construction complexity increases. A 16-megabyte block requires distribution across multiple subnets, avoiding the need for a single node to process the entire block.

Aggregators’ Challenges in MEV:

– Aggregators face the challenge of computing the state route without revealing the transactions or state updates, as this information could be exploited for MEV stealing.

Mitigating MEV Stealing:

– One approach involves a single aggregator node decrypting and computing the state route, but this introduces the risk of collusion with the proposer.

– Alternatively, the state route can be computed only after the proposer commits to a specific block and state root, preventing them from altering the block later.

– This commitment mechanism relies on the eigenlayer technique, where the proposer’s withdrawal address is set to a smart contract that enforces additional slashing conditions.

Post-Dank Sharding Block Construction:

– Post-dank sharding, a full block size can reach 16 megabytes, requiring efficient block construction and publication methods.

Distributed Erasure Coding:

– To avoid requiring a single node to perform complex tasks and connect to multiple subnets, distributed erasure coding is employed.

– Each node responsible for including a data transaction encodes and propagates the chunks of the transaction to the subnets.

Subnets and Data Availability:

– Data availability is ensured through subnets, where each subnet stores a portion of the block data.

– Nodes in each subnet verify the availability of the data and provide proofs of retrievability.

Proposer Selection and Finalization:

– The proposer for each block is selected randomly, ensuring fairness and preventing any single node from dominating block production.

– Finalization occurs after a certain number of blocks have been produced, allowing validators to verify the validity of the blocks before they are considered finalized.

KZG Commitment Math and Comparison of Approaches

KZG Commitment Math:

KZG commitments allow for efficient data processing through linear combinations of commitments and proofs, streamlining the row-filling process.

Data Availability and KZG Commitments:

– KZG commitments have linearity properties that allow for efficient data availability sampling.

– This linearity enables the generation of proofs for missing data columns based on existing proofs for other columns.

– Aggregators can utilize distributed processes to verify data availability without solely relying on the builder.

Row Commitments:

– In the absence of KZG commitments, builders must generate row commitments for each blob and provide column commitments.

– These commitments must align, ensuring that row commitments at a specific coordinate match column commitments at the same coordinate.

– Verifying the equivalence of these commitments can be done through distributed protocols, but it requires multiple rounds of communication.

Comparison of Approaches:

KZG-based row filling is more efficient than commitment checking, which requires active builder participation and a two-round protocol.

Advantages and Challenges of Distributed Builders

Faster Confirmation Times with Distributed Builders:

Builders can publicly commit to transaction inclusions, enhancing confirmation times. Incentives like slashing mechanisms and priority fees encourage commitment adherence.

Pre-Confirmations:

– Ethereum’s relatively long block times can be a disadvantage compared to faster VC chains.

– Pre-confirmations allow for faster transaction confirmation times by enabling validators to provide tentative confirmations before a block is finalized.

– This concept is still under development and requires further exploration to address potential challenges, such as censorship resistance and security.

Challenges of Distributed Builders:

Distributed systems face inherent latency and slower adaptation issues compared to centralized entities.

Potential Solutions:

Multi-round protocols and trusted hardware can address these challenges, ensuring efficient and secure communication between proposers and builders.

Conclusion

The exploration of distributed builders in Ethereum represents a significant step towards a more efficient, secure, and decentralized blockchain. By addressing challenges and implementing innovative solutions like trusted hardware and KZG commitments, Ethereum can overcome existing limitations and pave the way for a new era in blockchain technology. This evolution promises enhanced transaction processing, reduced risks of centralization, and a robust framework for future blockchain developments.

Notes by: crash_function