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Comment by spywaregorilla | Hacker News Reader

Who gets to decide if something should be slashed

It's determined by the majority of validators. There's two ways this can go - either the majority of validators enforce OFAC sanctions, effectively giving OFAC authority over the entire Ethereum network since validators who go against it will be slashed, or the majority of validators don't enforce sanctions, in which case validators with any presence in the US must put themselves in legal jeopardy to avoid getting slashed.

So if I acquire 51% of validation power, and you catch me cheating, the person who gets to decide if I get punished is me?

Technically yes, but I think the idea is that it would be incredibly expensive and unproductive to pull off such an attack. You'd first have to acquire billions of dollars worth of Ethereum, and then launching that attack would torpedo any trust in the network and send the value of Ethereum to zero, lighting your billions of dollars on fire. The theory is that it's too expensive to realistically do for the lulz or out of spite, and it wouldn't make economic sense to do it for profit.

As for how that theory will interact with reality, who knows.

It is not "incredibly expensive". Top 4 exchanges already hold > 50% of stake. Users give away their coins for free. For users, it's more expensive to run their own validator nodes than staking on a centralized service.

Kind of like the top 2 mining pools owning more than 51% of the hashrate.

At the very least, for an individual actor, it would be much more expensive to acquire 33% of all ETH than it would be to acquire 51% of the Bitcoin hashrate

Exchanges make money from transactions. If they destroy the network for their users, they lose all their cash flow.

Or you could be a government with billions staked in your jurisdiction, and bureaucratic indifference to the outcome of your regulatory actions.

A government spending billions of taxpayer dollars on an attack which can be reversed in an afternoon with a new software update is more likely to be an existential threat to that government than to Ethereum.

The sort of software update I'm imagining is one which just zeroes the holdings of the government wallet(s), and continues the chain from just before they launched their attack.

I think you lost the context of the thread. I'm not suggesting they will spend billions on crypto. I'm suggesting they will use their regulatory teeth to compel USA companies that have already staked billions worth of their customers' ETH to comply with the sanctions on Tornado Cash addresses, consequences/slashing be damned. OFAC has lawyers on payroll, so this would literally be free for them.

> I'm suggesting they will use their regulatory teeth to compel USA companies...

If there's one group that the government care more about the finances of than taxpayers, it's companies. Destroying the wealth of these companies in their jurisdiction is an attack that can only be performed once, and provides no long term benefit, except for people outside their jurisdiction.

So what happens if I instead submit a billion slasher reports that claim the eth foundation nodes have all lied, none of which contain valid evidence, and continue to do so every second. If there's no gatekeeper for these reports, then they're all valid. And they still need to be voted on, right?

Nothing, nothing happens. You can't just lie about slashing, the term "proof" is being used in the computational sense.

The submission you're describing requires a cryptographic proof of that validator submitting two or more existing invalid blocks that they signed. You can't just falsify that without their private keys, so what you're suggesting is not possible.

Sorry that's not correct. See https://news.ycombinator.com/item?id=32582316

It's baked into the protocol. A single validator can cryptographically prove that some other validator did something not allowed, and generate a special transaction that slashes that validator and gives you some ETH as a reward.

A common misconception here is that slashing happens based on what transactions you include or not. False. Slashing happens because of things such as proposing or attesting twice.

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