Validators receive punishments if they get disconnected from the platform. The penalties, in this case, are usually light due to the short time off-line.
Poloniex suffered a disconnection of all its Ethereum 2.0 validator nodes. They got inactive for at least 30 minutes on this June 22. This situation led to a loss in the returns of the exchange in parallel with a series of punishments.
These validator nodes got intended for the private use of the exchange since Poloniex does not give Ethereum 2.0 staking among its investment items. It means that it is not a staking pool; therefore, any loss goes as the sole and unique responsibility of the company.
The Ethereum 2.0 network did not face struggles due to the few nodes that got shut down. There are currently more than 400,000 validators, and Poloniex nodes only represent 0.1% of the total.
Each Ethereum 2.0 validator node gets generated by housing 32 ethers in a special contract, which cannot get withdrawn until the final launch of this platform takes effect. As the goal is to maintain a more transparent network, system validators could get punished for taking actions that may impact the said network.
These penalties are discounts in ETH. The fines might vary according to the activity executed by the node, which can range from inactivity due to a poor internet connection, carrying fewer penalties, to double-spending attempts, which can become the loss of a total of 32 ETH.
The Nodes of the Staking Pools
Although Poloniex’s Ethereum 2.0 validator nodes are private, there are many exchanges in the crypto space that could currently bring the possibility of taking on this network, such as Coinbase, Kraken, and Binance, which are in the top 5 holders of the most significant amount of validators.
The service offered by these exchanges is popularly known as staking pools. Users can invest in staking without the urgent need to count on the 32 ETH to become a validator.
Any staking pool has not received the penalties mentioned in the report. In that case, in theory, the company or organization should take complete responsibility for the losses, even though recent events show that entities sometimes transfer these consequences of their bad decisions to their users.
By: Jenson Nuñez
