Background and Challenges

The Solana network has rapidly grown thanks to its high throughput and scalability. However, it is currently facing issues such as a decline in the number of validators and the centralization of stakes among a few large validators.

When validator participation becomes increasingly centralized, it undermines the fundamental decentralization and security inherent to the Proof of Stake model. In particular, a declining or fixed Superminority (a measure of stake concentration) can make the network more susceptible to external attacks, while also creating barriers to entry for new validators—thus perpetuating a negative cycle.

Solana supports prioritized transaction processing via Stake-weighted Quality of Service (QoS), allocating bandwidth based on stake size. However, this mechanism often remains underutilized.

Many traders and projects deploy dedicated RPC nodes seeking optimal performance, but without sufficient stakes, these nodes face transaction limitations and fail to achieve their intended high performance. Although some validators independently offer stakes for lease, an efficient market has not emerged, leaving much stake bandwidth unused. This results in suboptimal performance, diminishing overall network efficiency.

Operating a validator involves significant responsibilities and costs, such as 24/7 uptime, frequent software updates, server expenses, and marketing efforts to gather stakes. Many validators fail to secure sufficient stakes, operating at a loss, especially affecting small and new validators, who are consequently at higher risk of exiting the network.

Under these conditions, stakes tend to concentrate among large validators, further undermining decentralization and security across the Solana network.

To address these challenges and truly activate the Solana network, it is crucial to increase the number of validators, promote decentralization, and introduce new revenue models such as QoS bandwidth rental. It is essential to create an ecosystem where individual participants, by simply pursuing their own incentives, naturally strengthen the entire network.

Validators DAO proposes a solution that integrates automated and efficient validator operations through "SLV" and "Validators Solutions," along with effective QoS bandwidth utilization via the liquid staking token "elSOL" and ERPC, fostering a positive feedback loop to enhance the Solana ecosystem.