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Ethereum staking protocol Lido Finance has disclosed its protocol saw 20 slashing events due to a series of infrastructure and signer configuration issues from validators operated by Launchnodes. <\/p>\n
The incident<\/a> occurred on Oct. 11 at about 3:30 pm UTC, according to Launchnodes. In an Oct. 11 post on X, Lido said<\/a> Launchnodes’ validators nodes are now offline, and slashings have ceased while the root cause was being investigated. <\/p>\n The slashing took place on the Ethereum blockchain and Lido projected the impact to be around 20 Ether (ETH),<\/a> worth $31,000, as well as additional penalties while the validators are offline for troubleshooting, along with inactivity penalties that the validators will accumulate. <\/p>\n 20 slashings have occurred relating to validators operated by the @launchnodes<\/a> node operators as a part of the Lido protocol. <\/p>\n Launchnodes and DAO contributors are investigating. <\/p>\n The validators are offline and slashings have ceased while the root cause is being investigated.<\/p>\n \u2014 Lido (@LidoFinance) October 11, 2023<\/a><\/p><\/blockquote>\n Slashing is a process where a validator breaches a blockchain\u2019s proof-of-stake consensus rules, which often results in the removal of that validator or slashing a portion of the staked-Ether that they provided as collateral.<\/p>\n In a post hours later, Launchnode said the slashing events occurred due to an infrastructure and signer configuration issue. <\/p>\n \u201cWe are investigating, and taking steps to prevent any further occurrences and restore full service,\u201d the platform added.<\/p>\n Addressing the 5:30pm CET incident with Launchnodes’ validator nodes for Lido protocol getting slashed: The issue is identified, and linked to an infrastructure and web3 signer configuration issue. We are investigating, and taking steps to prevent any further\u00a0occurrences and\u2026<\/p>\n \u2014 Launchnodes (@launchnodes) October 11, 2023<\/a><\/p><\/blockquote>\n Lido said stakers on the protocol are not affected<\/a> other than a reduction in daily rewards that will be reflected in the next rebase on Oct. 12.<\/p>\n The staking provider also confirmed that the Lido DAO has an insurance fund of 6,230<\/a> staked-ETH, worth $9.5 million, and will be used to mitigate the slashing impact \u2014 but by design it does not trigger automatically.<\/p>\n Lido added<\/a> that stETH holders will be compensated once the \u201ccover method\u201d has been decided, while Launchnodes has pledged<\/a> to reimburse all losses incurred to Lido. <\/p>\n Related: <\/em><\/strong>Ethereum staking services agree to 22% limit of all validators <\/em><\/strong><\/a><\/p>\n The liquid staking protocol<\/a> said the process isn\u2019t automatic because it is impossible to know what the total losses will be ahead of time.<\/p>\n Lido is by far the largest liquid staking protocol, with $13.8 billion in total value locked on its protocol, according<\/a> to DefiLlama. The next largest is Rocket Pool at $1.7 billion.<\/p>\n Only 226 validators<\/a> (0.04% of all validators) in the Ethereum ecosystem have been slashed since the launch of the Beacon Chain on Dec. 1, 2020 up until late February 2023.<\/p>\n Magazine:<\/em><\/strong> <\/em><\/strong>DeFi Dad, Hall of Flame: Ethereum is \u2018woefully undervalued\u2019 but growing more powerful<\/em><\/strong><\/a><\/p>\n<\/div>\n\n
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