AI Agent Evaluation
This analysis will focus on AI investment projects: QnA3, Wisdomise, 0xScope, PAAL, ChainGPT, ChatGPT. We will analyze the strengths of each advisor's structure and rate them accordingly.
The Bitcoin ETF Inflow/Outflow Relationship is Not That Simple
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*This Research is made by 432Hz Capital , NFA / DYOR 👇
Demand in the Ethereum Staking Market:
With Ethereum transitioning to a proof-of-stake mechanism, there is a growing demand for reliable and decentralized staking services. SSV Network, focusing on serving large stakeholders and Ethereum staking service providers, is at the heart of this demand.
Addressing Single Point of Failure Issues:
The introduction of Distributed Validation Technology (DVT) can effectively prevent single points of failure, enhancing the network's security and stability. SSV Network utilizes this technology to provide a more secure and decentralized solution for the staking market.
Reducing Operational Costs:
SSV Network helps staking service providers reduce the pressure of operating nodes, lower maintenance costs, and simplify the operation and upgrade processes. This offers economic benefits to staking service providers, allowing them to focus more on attracting staking assets.
Shared Commitment to Market Share Limitations:
Protocols like RocketPool, StakeWise, and Stader Labs have collectively committed to avoiding excessive market centralization, highlighting the importance of decentralization in the market. Although Lido Finance has not participated, this commitment underscores the potential role of platforms like SSV Network in promoting healthy market development.
Collaborations with Major Institutions:
SSV Network has established partnerships with major institutions and staking service providers, including Amber Group, Coinbase Ventures, and Lido Finance. This not only validates its technology and services but also lays a solid foundation for its future development.
Long-term Focus:
LSD (Liquid Staking Derivatives) is expected to be a long-term focus, with particular attention to the staking sector. As a key player in this field, SSV Network's position and role in the market will continue to strengthen.
In conclusion, based on the reasons above, investment and research in SSV Network are not only about assessing its current value and market position but also about considering its potential role and long-term value in advancing the Ethereum staking market and achieving the vision of decentralization.
The value of SSV primarily comes from staking rewards of ETH. By considering the total amount of staked ETH and the amount of ETH staked on SSV, we can calculate the earnings and estimate the potential cash flow. Using the parameters from the CFA valuation report, the reference prices for 2024 and 2025 are estimated to be 37.386 and 133.461, respectively.
Since the launch of SSV's mainnet, no significant issues have been observed. At the same time, protocols in the staking and re-staking sectors have been increasingly deepening their cooperation with SSV. Obol, which is also a developing DVT project, is a potential competitor in the market. However, Obol is currently still in the testnet phase and has not yet posed a significant threat to SSV, but it can still be classified as a potential market entrant.
SSV Network aims to address the centralization issues within Ethereum staking protocols. Through an analysis of its technical principles and development prospects, the primary target users of SSV Network are Ethereum stakers and operators interested in decentralized validator node technology (DVT). The project’s logic is based on Distributed Validator Technology (DVT), which involves distributing validator private keys across multiple machines to prevent single node failure and achieve decentralization. Its vision is to enhance the security and decentralization of the Ethereum network while improving the error tolerance of validators.
The section on the technical implementation and project value of SSV Network explores the concept of SSV (Secret Shared Validators). This concept, introduced in a research paper in collaboration with members of the Ethereum Foundation, aims to distribute the validation tasks across a group of nodes. This technology can be seen as a multisignature solution, with SSV Network being the practitioner implementing the SSV concept.
The current business scope of the project includes providing a network with higher security and decentralized services. Users must pay SSV fees to the network and operators as incentives, involving stakers and operators as the main participants in the network. Through this model, SSV Network offers a P2P marketplace where operators can set their own fees and compete with other operators.
In summary, the project positioning of SSV Network is to enhance the decentralization and security of the Ethereum network. The target user group comprises Ethereum network stakers and operators. The project’s logic is based on Distributed Validator Technology (DVT), aiming to achieve a highly secure and decentralized validation process. Its business scope involves providing a decentralized validation service platform, offering services to participants in the Ethereum network.
Alon Muroch, an Israeli with a rich professional background, has held various significant positions throughout his career. He was the founder of the social app Tzofe, where he worked for over a year. He then served as Vice President of R&D at Pixtr for one year and later became the co-founder of Bitcoin Authenticator, working there for a year and a half. Following this, he was the iOS Development Lead at PayKey for nearly two years. Most recently, he served as the CEO of the blockchain project BloxStaking, leading the project for five years.
Matthias Ang is the Global Business Development Lead and a core contributor at SSV Network. He focuses on business integration and is actively involved in various conferences and events in the blockchain field. In his current role, Matthias has played a crucial role in the development and success of SSV Network. He joined the ecosystem as a contributor from the DAO treasury and has made significant contributions in several areas, including the development of the first $50 million ecosystem fund, collaborating with over 10 top partners, and recruiting over 40 SSV operators. Additionally, he has encouraged more than 50 teams to adopt SSV/Distributed Validator Technology (DVT) to decentralize and improve the overall health of the ETH ecosystem, thereby contributing to the expansion of the protocol's ecosystem.
In November 2021, Grayscale's parent company, Digital Currency Group (DCG), and Coinbase each invested $250,000 and $1,000,000 respectively in SSV tokens, with an average purchase price of approximately $6.19. Additionally, the decentralized staking platform Lido DAO sponsored 16,640 LDO tokens. By February 2022, the project announced it had secured $10 million in funding from institutional investors, including Coinbase Ventures, Digital Currency Group (DCG), Gate.io Ventures, and OKEx Ventures. The specific cost of the financing was not disclosed.
Source : CRYPTO Fundriasing
Project Development Roadmap and Progress
DAO Genesis Committee Formation：In December 2022, the DAO Genesis Committee (dGC) was established, marking a crucial step towards project autonomy and sustainable growth.
SSV Foundation Formation：The SSV Foundation was formed, and through four rounds of testnet iterations, demonstrated the maturity and robustness of the technology.
Mainnet Launch: In July 2023, SSV Network officially launched on the Ethereum mainnet, signifying the completion of the transition from the pre-launch phase to the permissionless phase.
Key Milestones：
Achieving 70,000 ETH Staked: Collaboration with 92 active operators across five continents
Builder Contributions: Involvement of 55 builders in ecosystem development, with $3,143,530 allocated to builders.
Incentivized Mainnet Launch: Launch of the incentivized mainnet, successfully transitioning the project from the pre-launch phase to the permissionless phase.
Fully Permissionless Operation (December 2023): SSV Network achieved fully permissionless operation, allowing operators and validators to freely join the network. This is a crucial step towards decentralization.
Holesky Testnet: Holesky is set to replace the Goerli testnet, enhancing stability and performance.
Ether.fi Integration: Ether.fi integrated SSV Network into its system, improving the stability and security of its re-staking operations.
Lido x SSV DVT Holesky Testnet: In this testnet, SSV Network successfully enhanced Lido’s staking resilience and decentralization.
SSV on @LidoFinance Simple DVT is quickly approaching mainnet
Are you interested in becoming a node operator to reshape the future of staking? Check out Lido's post below to apply!
Calling Simple DVT participants
The deadline to apply for the @ssv_network testnet
is right around the corner.
Please get your application in before EOD Wednesday June 12th.
docs.google.com/forms/d/e/1FAI…
下午3:38 • 2024年6月6日
With Ethereum's transition from PoW to PoS consensus mechanism after The Merge, there has been a significant rise in the staking sector. This shift, however, has also introduced the issue of validator node centralization. SSV Network was created to address this problem.
SSV stands for Secret Shared Validator, a technology based on Distributed Validator Technology (DVT). It enables multiple members to collectively form a single validator node, enhancing the stability and security of the validator. This cryptographic technology distributes the validator's private key across multiple parties, preventing single points of failure or anomalies, and thereby ensuring a more decentralized validation process.
DVT Concept（Source：Ethereum Foundation）
Operators represent stakers who run and maintain the SSV nodes, generating ETH rewards for them. In return for their services, operators receive SSV tokens from the stakers.
Stakers deposit 32 ETH into the Beacon Chain and operate a validator, which secures the network by attesting to and proposing new blocks. Stakers pay operators in SSV tokens and earn ETH rewards by signing data transactions.
Liquidators work behind the scenes to ensure the network's solvency. When validators lack sufficient balance to pay their operators, liquidators signal the stakers. They are compensated with SSV tokens for successful liquidations.
SSV Token Overview：
Governance：SSV Network is open-source and decentralized, with governance resting in the hands of the community or DAO. Only SSV token holders can submit proposals and vote on them, enabling them to shape the DAO.
Payment Layer：SSV tokens function as the network's payment layer, creating economic incentives for operators. Each operator can set their own fees and compete with other operators for stakers. Stakers select multiple operators to manage their validators and must maintain a minimum SSV balance to pay their operators' fees.
SSV Token Utility：
Operators: Operators receive SSV tokens from stakers for managing their validators and generating ETH rewards on their behalf.
Stakers: Stakers pay operators with SSV tokens and receive ETH rewards directly from the blockchain.
Operators never hold or access the principal ETH deposits or the earned rewards of the stakers. Their role is to operate and maintain the validators that generate ETH rewards. They are not involved in distributing these rewards to the stakers.
Transparency: The protocol promotes a "free market" for staking operators, allowing them to offer services to stakers and compete for Total Value Locked (TVL).
Cost Optimization: Stakers have full control over their cost structure when selecting operators on the network. They can also reallocate their KeyShares to different operators to optimize their costs.
Inflows > Outflows: Stakers must hold a minimum amount of SSV tokens as collateral to avoid potential liquidation. This covers their operator costs over a period, helping maintain network solvency by ensuring operators are compensated for their duties. Additionally, it helps mitigate the selling pressure on operators realizing their SSV earnings.
Validator, Cost, and Operator Selection
Stakers distribute their validator KeyShares to four operator nodes on ssv.network. When selecting specific operators, stakers should consider the following factors: performance rating, validator status, client diversity, network effects, and price.
Each operator sets their specific fee in SSV tokens as their annual operator fee. For example, if all four operators price their services at $1 per year, the staker's total annual cost will be $4. Therefore, stakers need to deposit 4 SSV tokens into their wallet to stake with their chosen operators for a full year. Stakers can choose to deposit less than a full year's worth of SSV, as long as the amount exceeds their "liquidation collateral."
If stakers wish to stop their service, they can opt out at any time and withdraw the unused SSV balance from their wallet. When a staker removes their validator from the network, the operator cluster will cease managing it. Stakers can then migrate to a different service or manage their staking themselves without worrying about penalties or slashing.
Network Fees
In addition to operator fees, stakers need to pay network fees to use the network and the SSV protocol. The network fee is a fixed cost per validator determined by the DAO and is added to the annual operator costs. Network fees are directly transferred to the DAO treasury and are used to fund further ecosystem development and activities approved by the DAO.
Similar to operator fees, network fees are deducted over time from the staker’s SSV balance. Regardless of the operator cluster they choose, network fees remain a constant factor in the staker's cost structure.
Network fees provide a steady source of income for the DAO, supporting the ongoing growth and sustainability of the SSV ecosystem.
Factors Determining Network Fees:
Number of Validators/ETH Staked: The amount of ETH staked on ssv.network determines the network's capacity to generate fees. As the amount of staked ETH increases, the network fees generated also increase, benefiting the overall health of the network.
ETH Staking APY: The Annual Percentage Yield (APY) of Ethereum staking ultimately influences the network's ability to raise or lower fees. As the APY increases, the network fees also increase.
Operator Fees: Network fees should always be lower than the average cost of operators. For instance, if the average cost of using nodes on the network is 1 SSV token per year, we can assume that the network fee will be less than 1 SSV per year.
SSV Token Price: As the price of SSV tokens increases, the network fees may be reduced.
Operators – Rewards and Fee Distribution
SSV Network is unique in the transparency and free-market competition it introduces to the ETH staking space. Operators compete for stakers on multiple levels, including price. Ultimately, free market competition allows stakers to reduce costs and optimize staking returns. Operators running in node clusters benefit from fault tolerance and ultra-low slashing risk. When the risks associated with providing services are lower, pricing becomes more competitive, and service providers can improve capital efficiency by reducing insurance and other costsIt's important to note that operators within a cluster work together to generate ETH rewards for stakers. One of the advantages of SSV is that if one node is offline when a validator call is made to the Beacon Chain, the remaining nodes in the cluster will successfully execute the task. When this occurs, all nodes in the cluster receive the SSV reward for the given block. Thus, the fault tolerance provided by SSV is valuable to both operators and stakers. Operators can change their fees at any time. However, protocol-level restrictions limit the ability of operators to raise prices rapidly. This protects stakers from sudden spikes in usage costs.
Conclusion
Staking based on Distributed Validator Technology (DVT) is a network-wide effort aimed at decentralizing Ethereum’s security layer, or “Layer 0.” SSV Network can be seen as a mini-blockchain dedicated to enhancing fault tolerance, security, and decentralization for ETH stakers. This requires coordination of interests among stakeholders, operators, and the entire Ethereum ecosystem. SSV tokens help coordinate the various stakeholders participating in Ethereum’s Layer 0. The tokens provide stakeholders and operators with complete transparency, cost control, and flexibility. By introducing diversity among clients and service providers and utilizing a dynamic fee structure, the network can effectively coordinate efforts to maintain the health and robustness of Ethereum. Network fees enable the DAO to continuously invest resources in further developing Ethereum’s Layer 0. Accumulated fees are used to fund grants for projects that build more features and provide user-friendly access for non-technical stakers. SSV-based staking is inevitable. Distributing KeyShares among nodes and creating redundancy and fault tolerance for validators protecting the Ethereum protocol represents the future of ETH staking. Layer 1 (Ethereum) is supported and protected by Layer 0. It needs to be as decentralized as possible to make Ethereum the cornerstone of decentralized finance (DeFi) and other decentralized applications (dapps) for the next 100 years.
SSV primarily provides decentralized validator services for staking protocols (e.g., Lido) and re-staking protocols (e.g., EigenLayer). When using SSV services, ETH is also staked on SSV, positioning SSV firmly within the staking sector. According to BEACONCHA data, the total amount of staked ETH was 5,246,086 on June 12, 2021. By June 12, 2024, this number had increased to 32,669,010. This represents a compound annual growth rate (CAGR) of 83.98%, with the growth rate remaining relatively stable over the three years.
Cumulative ETH Staked (Source：BEACONCHA)
SSV Network currently operates over 200 nodes and has more than 3,800 validators, with over 120,000 ETH staked, making it the leading project in the DVT (Distributed Validator Technology) field. In February 2024, Obol announced the completion of a collaborative test with Lido, which meets the requirements for deployment on the Ethereum mainnet.
SafeStake has yet to show significant results. According to CoinMarketCap and CoinGecko, its total supply is reported as 1 billion and 100 million, respectively, indicating discrepancies. The official documents describe the token economics as "ongoing," suggesting that SafeStake is still in the proof-of-concept stage.
SSV Mainnet Operational Data
Stable Mainnet Operation
All test phases outlined in the roadmap have been completed, including multiple joint tests announced by LDO. The mainnet was launched in July 2023 and has been operating stably since then, making it the only DVT team with a live mainnet in the market.
Official Endorsement from the Ethereum Foundation
The DVT technology, originally named SSV in a research paper by Ethereum Foundation members, received significant recognition. In January 2022, Tim Beiko, a core developer from the Ethereum Foundation, joined the SSV DAO multisig wallet (SSV treasury) signing committee to co-validate and execute community-approved proposals. In February 2022, the official DVT technology framework published on Ethereum's GitHub not only abandoned the previously used intermediary validator node technology in favor of SSV's remote signing model but also announced SSV as a DVT technology provider interacting with the Ethereum 2.0 client Prysm.
Since the launch of SSV's mainnet, no significant issues have been reported. At the same time, protocols in the staking and re-staking sectors have increasingly deepened their cooperation with SSV. Obol, which is also developing DVT, is a potential competitor in the market. However, Obol is currently still in the testnet stage and has not yet posed a significant threat to SSV, classifying it as a potential market entrant.
The total amount of staked ETH is showing a stable growth trend. The staking and re-staking sectors have accelerated their growth since early 2023 and late 2023, respectively. As the bull market gains momentum, the price of SSV has been rising rapidly since October 2023, outpacing the growth of ETH. It is expected that SSV will continue to leverage the momentum of the Ethereum ecosystem and the staking sector, continuing its upward trajectory. In the event of a market pullback, it may be an opportunity to increase positions.
Liquid Staking TVL (Source：DefiLlama)
Staking TVL (Source：DefiLlama)
SSV Price Action since October 2023 (Source：TradingView)
SSV Network primarily assists in decentralizing validator nodes, preventing the over-concentration of ETH staking in certain protocols, thereby addressing the issue of validator node centralization. Therefore, the key to valuing SSV lies in the amount of ETH staked through the SSV Network.
Since its mainnet launch in July 2023, SSV Network is still in its early stages. However, even during its testing phase, it garnered significant market attention. For instance, leading staking protocol Lido DAO announced its testing with SSV in October 2022 and conducted another round of testing in March 2023, indicating its recognition of SSV's importance.
Beyond the staking sector, leading restaking protocol Eigenlayer announced its collaboration with SSV in January 2024. In March of the same year, the SSV team reiterated the native re-staking capabilities in their blog, emphasizing their innovative approach.
SSV Network's focus on DVT technology has been well-received by the market. The network now boasts over 3,800 validators and more than 120,000 ETH staked. Currently, there are no other strong competitors in the market. Given these achievements in a relatively short period, coupled with the steady growth of total ETH staked on-chain (see section 4.2), SSV Network's market share and the amount of ETH staked are expected to grow rapidly.
The value capture of SSV primarily comes from the earnings on staked ETH. We can estimate the potential cash flow by considering the total amount of staked ETH and the amount of ETH staked on SSV. Using the parameters from the CFA report and applying the discounted cash flow (DCF) method, we can estimate the reference prices for 2024 and 2025.
Currently, the total amount of staked ETH is 31,291,279 ETH, with 121,632 ETH staked on SSV (see section 4.3), which translates to a market share of approximately 0.39%. As analyzed in section 4.2, the compound annual growth rate (CAGR) of the total staked ETH is 109.74%. Based on this rate, we can project the total staked ETH from 2025 to 2028.
Assuming a staking yield of 4% for ETH and considering that a significant portion of SSV's ETH comes from staking and re-staking protocols, we can estimate that 10% of the total yield goes to SSV. Using a projected ETH price of $7,800 (double the current price of $3,900) for 2025, we can calculate the potential revenue based on the aforementioned data. Additionally, we assume that SSV's market share will stabilize at 10% by 2029.
The calculations indicate that the current estimated price of SSV is $37.386, which is close to the current market price. If the market price is lower than this estimate, it may be a good entry point for investment. The estimated price for March 2025 is $133.461, suggesting a potential growth of 3.56 times.
2024(Est. for March)
2025
2026
2027
2028
Total Staked ETH
31,291,279
34,339,050
37,683,673
41,354,063
45,381,948
Exit Multiples
22.1
SSV Market Share
0.39%
0.78%
1.55%
3.11%
6.22%
Discount Rate
30%
SSV ETH Amount
121,632
266,958
585,919
1,285,976
2,822,459
Compound Annual Growth Rate
109.74%
Yield
4%
4%
4%
4%
4%
ETH Spot Price
3900
Revenue Percentage
10%
10%
10%
10%
Revenue (M)
4.2
9.1
20.1
44.0
Total Value
373,858,623
Terminal Value
973.07
Circulating Supply
10,000,000
Present Cash Flow Value(M)
3.20
5.41
9.13
356.12
Estimated Price
37.386
SSV price estimated by the discounted cash flow method-2024(Present)
2025
2026
2027
2028
2029
Total Staked ETH
34,339,050
37,683,673
41,354,063
45,381,948
49,802,150
Exit Multiples
22.1
SSV Market Share
0.78%
1.55%
3.11%
6.22%
10.00%
Discount Rate
30%
SSV ETH Amount
266,958
585,919
1,285,976
2,822,459
4,980,215
Compound Annual Growth Rate
109.74%
Yield
4%
4%
4%
4%
4%
ETH Spot Price
7800
Revenue Percentage
10%
10%
10%
10%
Revenue (M)
18.3
40.1
88.1
155.4
Total Value
1,334,613,313
Terminal Value
3,433.96
Circulating Supply
10,000,000
Present Cash Flow Value(M)
14.06
23.74
40.08
1,256.73
Estimated Price
133.461
SSVprice estimated by the discounted cash flow method -2025 (March)
SSV's Distributed Validator Technology (DVT) is one of the key elements in maintaining the stability and security of the Ethereum network. It is currently highly regarded in both the staking and re-staking sectors and is in an early stage of rapid development. With the total amount of staked ETH steadily increasing and no strong competitors dividing the market, the future outlook is promising.
*This Research is made by 432Hz Capital , NFA / DYOR 👇
Demand in the Ethereum Staking Market:
With Ethereum transitioning to a proof-of-stake mechanism, there is a growing demand for reliable and decentralized staking services. SSV Network, focusing on serving large stakeholders and Ethereum staking service providers, is at the heart of this demand.
Addressing Single Point of Failure Issues:
The introduction of Distributed Validation Technology (DVT) can effectively prevent single points of failure, enhancing the network's security and stability. SSV Network utilizes this technology to provide a more secure and decentralized solution for the staking market.
Reducing Operational Costs:
SSV Network helps staking service providers reduce the pressure of operating nodes, lower maintenance costs, and simplify the operation and upgrade processes. This offers economic benefits to staking service providers, allowing them to focus more on attracting staking assets.
Shared Commitment to Market Share Limitations:
Protocols like RocketPool, StakeWise, and Stader Labs have collectively committed to avoiding excessive market centralization, highlighting the importance of decentralization in the market. Although Lido Finance has not participated, this commitment underscores the potential role of platforms like SSV Network in promoting healthy market development.
Collaborations with Major Institutions:
SSV Network has established partnerships with major institutions and staking service providers, including Amber Group, Coinbase Ventures, and Lido Finance. This not only validates its technology and services but also lays a solid foundation for its future development.
Long-term Focus:
LSD (Liquid Staking Derivatives) is expected to be a long-term focus, with particular attention to the staking sector. As a key player in this field, SSV Network's position and role in the market will continue to strengthen.
In conclusion, based on the reasons above, investment and research in SSV Network are not only about assessing its current value and market position but also about considering its potential role and long-term value in advancing the Ethereum staking market and achieving the vision of decentralization.
The value of SSV primarily comes from staking rewards of ETH. By considering the total amount of staked ETH and the amount of ETH staked on SSV, we can calculate the earnings and estimate the potential cash flow. Using the parameters from the CFA valuation report, the reference prices for 2024 and 2025 are estimated to be 37.386 and 133.461, respectively.
Since the launch of SSV's mainnet, no significant issues have been observed. At the same time, protocols in the staking and re-staking sectors have been increasingly deepening their cooperation with SSV. Obol, which is also a developing DVT project, is a potential competitor in the market. However, Obol is currently still in the testnet phase and has not yet posed a significant threat to SSV, but it can still be classified as a potential market entrant.
SSV Network aims to address the centralization issues within Ethereum staking protocols. Through an analysis of its technical principles and development prospects, the primary target users of SSV Network are Ethereum stakers and operators interested in decentralized validator node technology (DVT). The project’s logic is based on Distributed Validator Technology (DVT), which involves distributing validator private keys across multiple machines to prevent single node failure and achieve decentralization. Its vision is to enhance the security and decentralization of the Ethereum network while improving the error tolerance of validators.
The section on the technical implementation and project value of SSV Network explores the concept of SSV (Secret Shared Validators). This concept, introduced in a research paper in collaboration with members of the Ethereum Foundation, aims to distribute the validation tasks across a group of nodes. This technology can be seen as a multisignature solution, with SSV Network being the practitioner implementing the SSV concept.
The current business scope of the project includes providing a network with higher security and decentralized services. Users must pay SSV fees to the network and operators as incentives, involving stakers and operators as the main participants in the network. Through this model, SSV Network offers a P2P marketplace where operators can set their own fees and compete with other operators.
In summary, the project positioning of SSV Network is to enhance the decentralization and security of the Ethereum network. The target user group comprises Ethereum network stakers and operators. The project’s logic is based on Distributed Validator Technology (DVT), aiming to achieve a highly secure and decentralized validation process. Its business scope involves providing a decentralized validation service platform, offering services to participants in the Ethereum network.
Alon Muroch, an Israeli with a rich professional background, has held various significant positions throughout his career. He was the founder of the social app Tzofe, where he worked for over a year. He then served as Vice President of R&D at Pixtr for one year and later became the co-founder of Bitcoin Authenticator, working there for a year and a half. Following this, he was the iOS Development Lead at PayKey for nearly two years. Most recently, he served as the CEO of the blockchain project BloxStaking, leading the project for five years.
Matthias Ang is the Global Business Development Lead and a core contributor at SSV Network. He focuses on business integration and is actively involved in various conferences and events in the blockchain field. In his current role, Matthias has played a crucial role in the development and success of SSV Network. He joined the ecosystem as a contributor from the DAO treasury and has made significant contributions in several areas, including the development of the first $50 million ecosystem fund, collaborating with over 10 top partners, and recruiting over 40 SSV operators. Additionally, he has encouraged more than 50 teams to adopt SSV/Distributed Validator Technology (DVT) to decentralize and improve the overall health of the ETH ecosystem, thereby contributing to the expansion of the protocol's ecosystem.
In November 2021, Grayscale's parent company, Digital Currency Group (DCG), and Coinbase each invested $250,000 and $1,000,000 respectively in SSV tokens, with an average purchase price of approximately $6.19. Additionally, the decentralized staking platform Lido DAO sponsored 16,640 LDO tokens. By February 2022, the project announced it had secured $10 million in funding from institutional investors, including Coinbase Ventures, Digital Currency Group (DCG), Gate.io Ventures, and OKEx Ventures. The specific cost of the financing was not disclosed.
Source : CRYPTO Fundriasing
Project Development Roadmap and Progress
DAO Genesis Committee Formation：In December 2022, the DAO Genesis Committee (dGC) was established, marking a crucial step towards project autonomy and sustainable growth.
SSV Foundation Formation：The SSV Foundation was formed, and through four rounds of testnet iterations, demonstrated the maturity and robustness of the technology.
Mainnet Launch: In July 2023, SSV Network officially launched on the Ethereum mainnet, signifying the completion of the transition from the pre-launch phase to the permissionless phase.
Key Milestones：
Achieving 70,000 ETH Staked: Collaboration with 92 active operators across five continents
Builder Contributions: Involvement of 55 builders in ecosystem development, with $3,143,530 allocated to builders.
Incentivized Mainnet Launch: Launch of the incentivized mainnet, successfully transitioning the project from the pre-launch phase to the permissionless phase.
Fully Permissionless Operation (December 2023): SSV Network achieved fully permissionless operation, allowing operators and validators to freely join the network. This is a crucial step towards decentralization.
Holesky Testnet: Holesky is set to replace the Goerli testnet, enhancing stability and performance.
Ether.fi Integration: Ether.fi integrated SSV Network into its system, improving the stability and security of its re-staking operations.
Lido x SSV DVT Holesky Testnet: In this testnet, SSV Network successfully enhanced Lido’s staking resilience and decentralization.
SSV on @LidoFinance Simple DVT is quickly approaching mainnet
Are you interested in becoming a node operator to reshape the future of staking? Check out Lido's post below to apply!
Calling Simple DVT participants
The deadline to apply for the @ssv_network testnet
is right around the corner.
Please get your application in before EOD Wednesday June 12th.
docs.google.com/forms/d/e/1FAI…
下午3:38 • 2024年6月6日
With Ethereum's transition from PoW to PoS consensus mechanism after The Merge, there has been a significant rise in the staking sector. This shift, however, has also introduced the issue of validator node centralization. SSV Network was created to address this problem.
SSV stands for Secret Shared Validator, a technology based on Distributed Validator Technology (DVT). It enables multiple members to collectively form a single validator node, enhancing the stability and security of the validator. This cryptographic technology distributes the validator's private key across multiple parties, preventing single points of failure or anomalies, and thereby ensuring a more decentralized validation process.
DVT Concept（Source：Ethereum Foundation）
Operators represent stakers who run and maintain the SSV nodes, generating ETH rewards for them. In return for their services, operators receive SSV tokens from the stakers.
Stakers deposit 32 ETH into the Beacon Chain and operate a validator, which secures the network by attesting to and proposing new blocks. Stakers pay operators in SSV tokens and earn ETH rewards by signing data transactions.
Liquidators work behind the scenes to ensure the network's solvency. When validators lack sufficient balance to pay their operators, liquidators signal the stakers. They are compensated with SSV tokens for successful liquidations.
SSV Token Overview：
Governance：SSV Network is open-source and decentralized, with governance resting in the hands of the community or DAO. Only SSV token holders can submit proposals and vote on them, enabling them to shape the DAO.
Payment Layer：SSV tokens function as the network's payment layer, creating economic incentives for operators. Each operator can set their own fees and compete with other operators for stakers. Stakers select multiple operators to manage their validators and must maintain a minimum SSV balance to pay their operators' fees.
SSV Token Utility：
Operators: Operators receive SSV tokens from stakers for managing their validators and generating ETH rewards on their behalf.
Stakers: Stakers pay operators with SSV tokens and receive ETH rewards directly from the blockchain.
Operators never hold or access the principal ETH deposits or the earned rewards of the stakers. Their role is to operate and maintain the validators that generate ETH rewards. They are not involved in distributing these rewards to the stakers.
Transparency: The protocol promotes a "free market" for staking operators, allowing them to offer services to stakers and compete for Total Value Locked (TVL).
Cost Optimization: Stakers have full control over their cost structure when selecting operators on the network. They can also reallocate their KeyShares to different operators to optimize their costs.
Inflows > Outflows: Stakers must hold a minimum amount of SSV tokens as collateral to avoid potential liquidation. This covers their operator costs over a period, helping maintain network solvency by ensuring operators are compensated for their duties. Additionally, it helps mitigate the selling pressure on operators realizing their SSV earnings.
Validator, Cost, and Operator Selection
Stakers distribute their validator KeyShares to four operator nodes on ssv.network. When selecting specific operators, stakers should consider the following factors: performance rating, validator status, client diversity, network effects, and price.
Each operator sets their specific fee in SSV tokens as their annual operator fee. For example, if all four operators price their services at $1 per year, the staker's total annual cost will be $4. Therefore, stakers need to deposit 4 SSV tokens into their wallet to stake with their chosen operators for a full year. Stakers can choose to deposit less than a full year's worth of SSV, as long as the amount exceeds their "liquidation collateral."
If stakers wish to stop their service, they can opt out at any time and withdraw the unused SSV balance from their wallet. When a staker removes their validator from the network, the operator cluster will cease managing it. Stakers can then migrate to a different service or manage their staking themselves without worrying about penalties or slashing.
Network Fees
In addition to operator fees, stakers need to pay network fees to use the network and the SSV protocol. The network fee is a fixed cost per validator determined by the DAO and is added to the annual operator costs. Network fees are directly transferred to the DAO treasury and are used to fund further ecosystem development and activities approved by the DAO.
Similar to operator fees, network fees are deducted over time from the staker’s SSV balance. Regardless of the operator cluster they choose, network fees remain a constant factor in the staker's cost structure.
Network fees provide a steady source of income for the DAO, supporting the ongoing growth and sustainability of the SSV ecosystem.
Factors Determining Network Fees:
Number of Validators/ETH Staked: The amount of ETH staked on ssv.network determines the network's capacity to generate fees. As the amount of staked ETH increases, the network fees generated also increase, benefiting the overall health of the network.
ETH Staking APY: The Annual Percentage Yield (APY) of Ethereum staking ultimately influences the network's ability to raise or lower fees. As the APY increases, the network fees also increase.
Operator Fees: Network fees should always be lower than the average cost of operators. For instance, if the average cost of using nodes on the network is 1 SSV token per year, we can assume that the network fee will be less than 1 SSV per year.
SSV Token Price: As the price of SSV tokens increases, the network fees may be reduced.
Operators – Rewards and Fee Distribution
SSV Network is unique in the transparency and free-market competition it introduces to the ETH staking space. Operators compete for stakers on multiple levels, including price. Ultimately, free market competition allows stakers to reduce costs and optimize staking returns. Operators running in node clusters benefit from fault tolerance and ultra-low slashing risk. When the risks associated with providing services are lower, pricing becomes more competitive, and service providers can improve capital efficiency by reducing insurance and other costsIt's important to note that operators within a cluster work together to generate ETH rewards for stakers. One of the advantages of SSV is that if one node is offline when a validator call is made to the Beacon Chain, the remaining nodes in the cluster will successfully execute the task. When this occurs, all nodes in the cluster receive the SSV reward for the given block. Thus, the fault tolerance provided by SSV is valuable to both operators and stakers. Operators can change their fees at any time. However, protocol-level restrictions limit the ability of operators to raise prices rapidly. This protects stakers from sudden spikes in usage costs.
Conclusion
Staking based on Distributed Validator Technology (DVT) is a network-wide effort aimed at decentralizing Ethereum’s security layer, or “Layer 0.” SSV Network can be seen as a mini-blockchain dedicated to enhancing fault tolerance, security, and decentralization for ETH stakers. This requires coordination of interests among stakeholders, operators, and the entire Ethereum ecosystem. SSV tokens help coordinate the various stakeholders participating in Ethereum’s Layer 0. The tokens provide stakeholders and operators with complete transparency, cost control, and flexibility. By introducing diversity among clients and service providers and utilizing a dynamic fee structure, the network can effectively coordinate efforts to maintain the health and robustness of Ethereum. Network fees enable the DAO to continuously invest resources in further developing Ethereum’s Layer 0. Accumulated fees are used to fund grants for projects that build more features and provide user-friendly access for non-technical stakers. SSV-based staking is inevitable. Distributing KeyShares among nodes and creating redundancy and fault tolerance for validators protecting the Ethereum protocol represents the future of ETH staking. Layer 1 (Ethereum) is supported and protected by Layer 0. It needs to be as decentralized as possible to make Ethereum the cornerstone of decentralized finance (DeFi) and other decentralized applications (dapps) for the next 100 years.
SSV primarily provides decentralized validator services for staking protocols (e.g., Lido) and re-staking protocols (e.g., EigenLayer). When using SSV services, ETH is also staked on SSV, positioning SSV firmly within the staking sector. According to BEACONCHA data, the total amount of staked ETH was 5,246,086 on June 12, 2021. By June 12, 2024, this number had increased to 32,669,010. This represents a compound annual growth rate (CAGR) of 83.98%, with the growth rate remaining relatively stable over the three years.
Cumulative ETH Staked (Source：BEACONCHA)
SSV Network currently operates over 200 nodes and has more than 3,800 validators, with over 120,000 ETH staked, making it the leading project in the DVT (Distributed Validator Technology) field. In February 2024, Obol announced the completion of a collaborative test with Lido, which meets the requirements for deployment on the Ethereum mainnet.
SafeStake has yet to show significant results. According to CoinMarketCap and CoinGecko, its total supply is reported as 1 billion and 100 million, respectively, indicating discrepancies. The official documents describe the token economics as "ongoing," suggesting that SafeStake is still in the proof-of-concept stage.
SSV Mainnet Operational Data
Stable Mainnet Operation
All test phases outlined in the roadmap have been completed, including multiple joint tests announced by LDO. The mainnet was launched in July 2023 and has been operating stably since then, making it the only DVT team with a live mainnet in the market.
Official Endorsement from the Ethereum Foundation
The DVT technology, originally named SSV in a research paper by Ethereum Foundation members, received significant recognition. In January 2022, Tim Beiko, a core developer from the Ethereum Foundation, joined the SSV DAO multisig wallet (SSV treasury) signing committee to co-validate and execute community-approved proposals. In February 2022, the official DVT technology framework published on Ethereum's GitHub not only abandoned the previously used intermediary validator node technology in favor of SSV's remote signing model but also announced SSV as a DVT technology provider interacting with the Ethereum 2.0 client Prysm.
Since the launch of SSV's mainnet, no significant issues have been reported. At the same time, protocols in the staking and re-staking sectors have increasingly deepened their cooperation with SSV. Obol, which is also developing DVT, is a potential competitor in the market. However, Obol is currently still in the testnet stage and has not yet posed a significant threat to SSV, classifying it as a potential market entrant.
The total amount of staked ETH is showing a stable growth trend. The staking and re-staking sectors have accelerated their growth since early 2023 and late 2023, respectively. As the bull market gains momentum, the price of SSV has been rising rapidly since October 2023, outpacing the growth of ETH. It is expected that SSV will continue to leverage the momentum of the Ethereum ecosystem and the staking sector, continuing its upward trajectory. In the event of a market pullback, it may be an opportunity to increase positions.
Liquid Staking TVL (Source：DefiLlama)
Staking TVL (Source：DefiLlama)
SSV Price Action since October 2023 (Source：TradingView)
SSV Network primarily assists in decentralizing validator nodes, preventing the over-concentration of ETH staking in certain protocols, thereby addressing the issue of validator node centralization. Therefore, the key to valuing SSV lies in the amount of ETH staked through the SSV Network.
Since its mainnet launch in July 2023, SSV Network is still in its early stages. However, even during its testing phase, it garnered significant market attention. For instance, leading staking protocol Lido DAO announced its testing with SSV in October 2022 and conducted another round of testing in March 2023, indicating its recognition of SSV's importance.
Beyond the staking sector, leading restaking protocol Eigenlayer announced its collaboration with SSV in January 2024. In March of the same year, the SSV team reiterated the native re-staking capabilities in their blog, emphasizing their innovative approach.
SSV Network's focus on DVT technology has been well-received by the market. The network now boasts over 3,800 validators and more than 120,000 ETH staked. Currently, there are no other strong competitors in the market. Given these achievements in a relatively short period, coupled with the steady growth of total ETH staked on-chain (see section 4.2), SSV Network's market share and the amount of ETH staked are expected to grow rapidly.
The value capture of SSV primarily comes from the earnings on staked ETH. We can estimate the potential cash flow by considering the total amount of staked ETH and the amount of ETH staked on SSV. Using the parameters from the CFA report and applying the discounted cash flow (DCF) method, we can estimate the reference prices for 2024 and 2025.
Currently, the total amount of staked ETH is 31,291,279 ETH, with 121,632 ETH staked on SSV (see section 4.3), which translates to a market share of approximately 0.39%. As analyzed in section 4.2, the compound annual growth rate (CAGR) of the total staked ETH is 109.74%. Based on this rate, we can project the total staked ETH from 2025 to 2028.
Assuming a staking yield of 4% for ETH and considering that a significant portion of SSV's ETH comes from staking and re-staking protocols, we can estimate that 10% of the total yield goes to SSV. Using a projected ETH price of $7,800 (double the current price of $3,900) for 2025, we can calculate the potential revenue based on the aforementioned data. Additionally, we assume that SSV's market share will stabilize at 10% by 2029.
The calculations indicate that the current estimated price of SSV is $37.386, which is close to the current market price. If the market price is lower than this estimate, it may be a good entry point for investment. The estimated price for March 2025 is $133.461, suggesting a potential growth of 3.56 times.
2024(Est. for March)
2025
2026
2027
2028
Total Staked ETH
31,291,279
34,339,050
37,683,673
41,354,063
45,381,948
Exit Multiples
22.1
SSV Market Share
0.39%
0.78%
1.55%
3.11%
6.22%
Discount Rate
30%
SSV ETH Amount
121,632
266,958
585,919
1,285,976
2,822,459
Compound Annual Growth Rate
109.74%
Yield
4%
4%
4%
4%
4%
ETH Spot Price
3900
Revenue Percentage
10%
10%
10%
10%
Revenue (M)
4.2
9.1
20.1
44.0
Total Value
373,858,623
Terminal Value
973.07
Circulating Supply
10,000,000
Present Cash Flow Value(M)
3.20
5.41
9.13
356.12
Estimated Price
37.386
SSV price estimated by the discounted cash flow method-2024(Present)
2025
2026
2027
2028
2029
Total Staked ETH
34,339,050
37,683,673
41,354,063
45,381,948
49,802,150
Exit Multiples
22.1
SSV Market Share
0.78%
1.55%
3.11%
6.22%
10.00%
Discount Rate
30%
SSV ETH Amount
266,958
585,919
1,285,976
2,822,459
4,980,215
Compound Annual Growth Rate
109.74%
Yield
4%
4%
4%
4%
4%
ETH Spot Price
7800
Revenue Percentage
10%
10%
10%
10%
Revenue (M)
18.3
40.1
88.1
155.4
Total Value
1,334,613,313
Terminal Value
3,433.96
Circulating Supply
10,000,000
Present Cash Flow Value(M)
14.06
23.74
40.08
1,256.73
Estimated Price
133.461
SSVprice estimated by the discounted cash flow method -2025 (March)
SSV's Distributed Validator Technology (DVT) is one of the key elements in maintaining the stability and security of the Ethereum network. It is currently highly regarded in both the staking and re-staking sectors and is in an early stage of rapid development. With the total amount of staked ETH steadily increasing and no strong competitors dividing the market, the future outlook is promising.
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