Interpreting the Metis PoS "Sorting Pool": Decentralization, the Road to Decentralized Rollup

By Gou, Foresight News

Jon Charbonnea, co-founder of DBA, has said that all rollups are not true rollups these days.

One of the most important reasons for such an extreme view is that almost all Rollup networks currently use a centralized single sequencer model. For networks that have adopted Optimistic Rollup, although the project team itself will most likely not choose to do evil on the sequencer, once the sequencer is attacked or controlled by others, it may have catastrophic consequences. Even without security considerations, single-sequencers are completely censorship-resistant.

There has been a long history of discussion and advocacy for the decentralization of sequencers, and recently Metis has been the first to provide an answer to this question.

Why is the decentralization of sequencers so important?

Before we get into the details of Metis’ decentralized sequencer solution, let’s take a brief look at two questions: What is a sequencer, and why is it important?

The Rollup-based Layer2 network on top of ETH Workshop is essentially composed of an independent chain and the “Rollup Contract” on the ETH Workshop. At the same time, the Layer 2 network also needs an off-chain sequencer to receive the transactions that occur on the Layer 2, determine the order in which the transactions are executed, and then package the transactions into batches and send them to the “Rollup contract” on the ETH. When the “Rollup Contract” on the ETH Square packs the transmitted Batch into a block, the transaction will be finalized.

Essentially, the true “confirmation” of transactions on the Layer 2 network is still on the ETH, and the sequencer plays a role in the transmission of information in between.

Metis uses the Optimistic Rollup scheme, which, as the name suggests, is characterized by assuming that all transactions in the batch are real and valid, without checking every transaction. Because of this, coupled with the fact that transactions are centralized and then confirmed, the transaction fees of the Layer2 network based on Optimistic Rollup are very low.

At present, the Layer 2 network is almost always run by the project team, and in order not to “smash their own signboards”, it is very rare for the transaction submitted in the sequencer to be invalid. Despite this, there is still the possibility that centralized formations will be attacked and forced to exclude certain transactions. This is clearly unacceptable for the crypto world, where “permissionless” and “trustless” are paramount, and decentralization is a path that must be taken.

Metis’ path to decentralization

As one of the first Layer2 networks to practice decentralized sequencers, Metis provides a model for the way forward. This template not only implements the decentralization of sequencers, but also provides a “decentralized optimistic rollup” solution. In this template, there are three main roles to implement the decentralization of the sequencer: the administrator (Admin), the sequencer, and a PoS-based consensus layer.

The role of the Admin :* the Admin is to manage the decentralized system, and its main responsibilities include adding eligible sequencers to the whitelist, setting the staking limit for a single node, and setting the release rate of the block reward.

Sequencer Pool: A sequencer pool consists of multiple sequencers that have been added to the whitelist. In Metis, sequencers include the L2 Geth, which is responsible for transaction ordering and block formation on Metis, the adapter module, which interacts with the PoS consensus layer and other external modules mentioned below, and the Proposer, which is responsible for setting up Batch and submitting it to L1 after multiple sequencers have signed it.

PoS Consensus Layer: The PoS consensus layer designed by Metis is independent of Metis, and its primary responsibility is to manage MPC signatures. When there are multiple sequencers, at least 2/3 of the sequencer signatures are required to commit the packaged Batch to L1, and the consensus layer is responsible for resharding and assigning private keys when sequencers in the sequencer pool join or exit.

Mechanism Design

With the cooperation of the above three roles, Metis’ decentralized Optimistic Rollup has begun to take shape. Among them, the “administrator” will set the important parameters of the overall network and manage the qualifications of the sequencers to join the pool, so that the protocol party no longer has absolute control over such transactions, but will be approved by the administrator through specific proposals.

For the rollup network, the most difficult point in the decentralization process is the decentralization of the sequencer, because the management of the sequencer itself must also be carried out in a decentralized way, and it needs to be as efficient and convenient as possible.

Metis employs TSS-based MPC signing and a PoS network that manages the entire module to manage multiple sequencer signing permissions.

Metis allows any sequencer to decide a batch and all sequencers participate in MPC signing, if the number of signatures exceeds 2/3, the batch is considered valid and can be submitted to the Rollup contract on L1. The MPC signature performed by the sequencer pool is managed by another contract controlled by the PoS network, and when the PoS network fails to detect the MPC address, the MPC module is called to trigger the generation of the key. The generated key is distributed to each sequencer in the pool after sharding, and the sequencer shards the key it holds for MPC signature. The settings of this module are mainly used to manage the lifecycle of keys, including multisig generation, key resharing, application signing, deletion of signatures, etc.

Unlike multi-signature, which requires verification of each signature on the chain, TSS only needs to aggregate the signatures of all signers and verify them uniformly, which improves the transaction confirmation rate. In addition, PoS nodes communicate with each other through a separate Tendermint channel, and the MPC runtime communicates using the libp2p protocol.

Token Staking

Similar to Optimism Rollup’s proof of fraud, this decentralized model employs an economic incentive and punishment mechanism to keep the mechanism running. According to Metis team members, the sequencer pool will initially consist of five sequencers, which will be gradually increased in the future, and sequencer operators entering the sequencer pool will need to stake at least 20,000 METIS. In addition, the PoS networks mentioned above will also require node operators to stake METIS. According to the Metis team, the move could “further reduce the already limited METIS circulation, resulting in a very positive catalytic effect.” 」

The staked METIS is deducted when the fraud proof is successfully challenged to ensure that the sequencer does not include invalid transactions in the Batch submitted to L1.

Pioneer of “decentralization”.

Metis’ decentralized rollup solution provides a good model for Layer 2 to move to the next stage, and it has played a role in promoting the development of the project on the basis of ensuring decentralization, both in terms of mechanism design and economic mechanism design.

Leaving the sequencer completely in the hands of the community can generate a large number of derivative opportunities through the community’s spontaneous promotion. On the one hand, for participants, decentralization implies some level of competition, as sequencers participate in block production, similar to the role of miners in BTC networks. In order to compete for the right to bookkeeping, all parties will continue to improve the quality of their nodes, so as to spontaneously bring stronger activity to the network. Metis said, "This will be the first chain in the Layer 2 space where the community is truly involved in the operation. 」

In addition, due to the decentralization of the sequencer, there is no “standard answer” for the ordering of transactions, which nurtures the soil for the birth and development of the network’s MEV infrastructure and a range of applications. After MEV, a series of products such as liquid staking can also be derived from METIS tokens based on sequencer staking, further unleashing the potential of Layer2 infrastructure financialization.

In terms of mechanism design, Metis does not use simple multisig for sequencers operated by various parties, but uses a TSS-based MPC signature scheme that is more convenient to add or remove signers in real time, which improves the overall flexibility of the sequencer pool. On the other hand, 2/3 of the effective signature threshold, “pluggable” signature scheme, etc., all make a good trade-off between security and efficiency.

Although the mechanism is designed with security and efficiency in mind, the efficiency of multiple new roles added for decentralization will inevitably decrease compared with the traditional single sequencer, and the increase in links may lead to an increase in the overall system instability. Nevertheless, as one of the first Layer2 networks to provide a complete decentralized solution, Metis still has many considerations and trade-offs in its design, and Metis said that it will continue to discuss the potential challenges and pitfalls of the decentralized solution for further improvement.