rewrite this title Lido Introduces Auxiliary Proposer Mechanisms To Enhance Ethereum Block Proposals

by
Alisa Davidson

Published: May 20, 2025 at 3:14 am Updated: May 20, 2025 at 3:14 am

by Ana

Edited and fact-checked:
May 20, 2025 at 3:14 am

To improve your local-language experience, sometimes we employ an auto-translation plugin. Please note auto-translation may not be accurate, so read original article for precise information.

Liquid staking protocol on Ethereum, Lido introduced Auxiliary Proposer Mechanisms (APMs), a framework designed to support the secure evaluation and potential integration of emerging tools related to block construction within the Ethereum network. These mechanisms align with ongoing developments in Ethereum’s infrastructure, particularly concerning how blocks are proposed and transactions are confirmed.

APMs represent a systematic method for assessing innovations such as the separation of block proposing and building roles (PBS), the use of preconfirmations to provide faster transaction assurance, and the development of advanced block markets that influence how block rewards are optimized. Through this framework, Lido aims to ensure that any improvements adopted serve the interests of Node Operators and stakers by enhancing efficiency and profitability while minimizing risk exposure.

The APM framework consists of three main elements that work together to support experimentation with new block creation methods on Ethereum. The first element, referred to as mechanisms, represents broad conceptual innovations such as proposer-builder separation or preconfirmations. The second element includes protocols, which are the detailed technical implementations of those concepts, such as MEV-Boost or Bolt. The third component involves sidecars, which are supporting software tools that enable or enhance the functionality of these protocols, including examples like MEV-Boost and Commit-Boost. This modular design provides adaptability, allowing various tools to be mixed and evaluated in different combinations without interfering with Ethereum’s underlying protocol.

For safety and reliability reasons, the rollout of APMs follows a defined multi-stage process. The initial phase focuses on preparation, where each APM must present comprehensive documentation, include a way to monitor performance, outline a system for distributing rewards, and, where feasible, undergo independent security assessments. In the next phase, a proposal known as PERCH is submitted to gauge interest from Node Operators, preferably after initial testing has been conducted outside Lido’s infrastructure. 

Once community interest is established, the APM enters a testnet phase lasting a minimum of one month. During this period, it must involve an adequate number of validator keys and meet predetermined benchmarks for success. Following the test phase, a thorough security review is conducted by the community and Node Operators to identify potential vulnerabilities and determine appropriate mitigation strategies. If the mechanism meets all safety and performance criteria, the APM Committee may approve a phased rollout, beginning with Node Operators who choose to participate.

Lido Outlines Proposal To Update Block Proposer Rewards Policy, Invites Feedback On APM Framework

In order to support fair participation and maintain transparency, a proposal is being developed to update the Block Proposer Rewards Policy. This adjustment is intended to ensure that Node Operators who adopt APMs do so in a way that aligns with the interests of stakers, operators, and the broader protocol.

As the process of block production on Ethereum continues to evolve, this framework aims to equip the protocol with the necessary tools to adapt effectively. It is designed to enhance operational efficiency and unlock additional value, while maintaining core principles such as decentralization and security. The development and evaluation of these mechanisms are not limited to internal decision-making. Input is being welcomed from Node Operators, researchers, and community participants to shape the approach collaboratively.

Lido operates as a liquid staking platform supporting Ethereum and Polygon. It provides liquid staking derivatives and the underlying smart contract infrastructure that allows users to stake tokens while maintaining liquidity.

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.

More articles

Alisa Davidson

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.

More articles