SSV Network Rolls Out ‘SSV2.0’ Based Applications Protocol, Unlocking Validator Yield
In Brief
SSV Network has launched SSV2.0 with the aim of transforming the restaking market and contributing to the rise of the Based Economy, bridging Ethereum and offering new sources of yield for validators.
Provider of decentralized and scalable staking infrastructure, SSV Network announced the launch of its SSV2.0–Based Applications Protocol. This new development is expected to transform the restaking market and contribute to the rise of the Based Economy, bridging Ethereum and providing fresh sources of yield for validators. This vision has been developed by SSV Labs and shared with the SSV Network DAO.
SSV2.0 introduces a bootstrapping model that creates new opportunities for validators by integrating off-chain services, referred to as “based applications” (bApps). Through SSV2.0, validators can extend their security to support a broader range of applications, effectively creating a new asset class: the Validator.
This advancement offers a new approach for validators to earn more by increasing their involvement. By utilizing validators as a valuable asset class, SSV2.0 unlocks a new category of decentralized applications – based applications (bApps). A bApp is defined as any service or application that takes advantage of Ethereum validators for their security, decentralization, and inherent Sybil resistance.
Developers can leverage bApps for a variety of purposes, such as rollups, co-processors, oracles, bridges, and other use cases. bApps can also enable innovative solutions like pre-confirmations and base-sequencing. By allowing SSV validators to engage with new opportunities, bApps can boost validator yields while ensuring their security, without introducing additional risk to the validators or the Ethereum network.
Based-Applications Chain To Power SSV2.0
The Based-Applications Chain is the first bApp set to launch as part of the phased rollout of SSV2.0. The bApps chain will function as an “App chain,” incorporating existing DVT contracts and operations from the SSV Network, along with new bApp operations and features.
The decision to design the bApps chain as an App Chain is based on four key factors: First, Ethereum’s calldata limitations can hinder the efficient operation of data-heavy DVT and bApps. The bApps chain addresses this by enabling high-volume transactions with persistence, bypassing these constraints. Second, gas fees on Ethereum can make DVT operations costly, so a dedicated bApps chain helps reduce transaction expenses, benefiting both developers and users. Third, the bApps chain leverages light clients, allowing for efficient participation and minimizing storage and processing requirements. This makes it easier for bApp developers and operators to join the network. Finally, the bApps chain features a credibly neutral coordination layer that integrates seamlessly with multiple Layer 1 blockchains. This removes chain-specific dependencies, supporting a decentralized and interoperable ecosystem.
SSV Network Proposes Updated Tokenomics Along With SSV 2.0 Launch
As the SSV Network evolves from a DVT-powered staking infrastructure to a more complex network supporting the based ecosystem, an update to the SSV tokenomics will be required. The SSV Network DAO will explore new mechanisms to avoid inflating the supply of SSV tokens. SSV staking will play a key role in securing the Based-Applications Chain. Similar to other blockchains, and to ensure the integrity of the bApps chain, SSV tokens will be exclusively staked as a slashable commitment by validators.
The fees accumulated through staking will be distributed to each node operator based on their responsibilities to the bApp. Operators have the flexibility to allocate a portion of the rewards to delegators who contribute SSV tokens or validators. The remaining rewards are retained as operator fees.
The minting of SSV tokens is fully controlled by the SSV DAO’s Multisig committee and requires approval from the Decentralized Autonomous Organization (DAO). Currently, the bulk of the minting process is driven by the Incentivized Mainnet (IM) program, which has minted over 600,000 SSV since its inception in October 2023. This program is set to end on December 31, 2025. Additionally, the protocol burns a portion of collected fees based on the amount of SSV staked. The burn rate increases as more tokens are staked, leading to a reduction in the circulating supply. Due to the decreasing minting rate and increasing burn from staking, SSV’s inflation will decrease over time. In an optimistic scenario, the network could become deflationary by 2027, with a more conservative estimate expecting deflation to begin in 2028 or 2029.
The SSV2.0 rollout will follow a phased approach, with each phase building on the last. According to the roadmap, the testnet is expected to launch in Q1, the mainnet in Q2, the bApp Chain will go live in Q3, and the full activation of the bApp Chain is planned for 2026.
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About The Author
Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
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Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
