Kraken has become the first major crypto exchange to fully adopt Distributed Validator Technology (DVT) across its Ethereum staking infrastructure, using the open-source SSV Network protocol.
The move marks a major shift towards a more decentralized validator architecture for Ethereum.
“Following the successful transition, essentially all of Kraken’s ETH staking infrastructure runs on distributed validator clusters, rather than single-machine validators,” a Kraken spokesperson told Blockworks.
DVT decentralizes validator operations by splitting responsibilities across multiple independent nodes that cooperate to perform attestations and block proposals. Kraken said each validator is now operated by “a cluster of typically four independent nodes,” with deliberate diversity in both software and geography.
“We design for maximum diversity: nodes are spread across different regions and run a mix of Ethereum client implementations to avoid any single-client bug impacting the whole cluster,” the spokesperson added.
Key management was also overhauled as part of the migration. “As part of our transition to DVT, validator keys were split and distributed to cluster operators to ensure no single operator holds the entire key,” Kraken said. For newly created validators, keys are generated in a distributed manner “so the full private key is never assembled.”
To reduce slashing risk, Kraken’s operators use a synchronized, distributed slashing-protection database. “If a node goes offline, it can sync the history of signed duties from the cluster before signing anything new,” the spokesperson explained.
SSV Labs, which is a core contributor to the DVT protocol, emphasized the modularity and configurability of its approach. “The nature of DVT is more diversity by design, and it is more of a ‘user’ choice. Every participant can optimize for diversity, whatever that means for them,” an SSV spokesperson told Blockworks.
Kraken’s implementation gives a strong boost to DVT adoption, according to Alon Muroch, SSV Labs founder and core contributor. “It demonstrates that the technology is ready for use at scale in institutional staking environments,” Muroch said.
Originally known under Blox.io and CoinDash brands, the team behind SSV Network pivoted, beginning in early 2021, launching the SSV token, to focus on noncustodial ETH staking infrastructure, and later DVT, supported by an Ethereum Foundation grant. SSV Network was created to make centralized staking providers obsolete.
Earlier this year, Obol — another DVT provider — launched its native OBOL token to empower community governance and operator coordination. The rise of DVT solutions like SSV and Obol help Ethereum reduce centralization risks by distributing validator duties across diverse operators and geographic locations, enhancing uptime, slashing safety, and the overall robustness of network consensus.
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Source: https://blockworks.co/news/kraken-full-dvt-integration-ethereum-staking