Running an Ethereum validator allows one to:
<ol>
<li>Receive Staking Rewards: Validators get network rewards for performing their duties on the Ethereum blockchain (note: incorrectly or not performing duties incurs penalties).</li>
<li>Support the Network: By running a validator, you actively contribute to the decentralization and security of the Ethereum network. Validators play a crucial role in reaching consensus and validating transactions, which enhances the network's reliability and resilience.</li>
<li>Learn and Engage with the community: Operating a validator node provides valuable insights into blockchain technology and consensus mechanisms. Through hands-on experience, individuals can deepen their understanding of Ethereum's inner workings. Moreover, it provides an opportunity to engage with the Ethereum community, share knowledge, and contribute to the network's development.</li>
</ol>

Why run an Ethereum validator?

Node operation in CSM involves a long-term commitment to Ethereum's decentralization. Responsibilities include:
<ul>
<li>Hardware Setup: Setting up a computer that meets the system requirements for running validator nodes.</li>
<li>Configuration: Properly configuring nodes and validators, ensuring they are in sync with the Ethereum blockchain and other network participants.</li>
<li>Security Measures: Implementing robust security measures to safeguard against external threats and internal vulnerabilities.</li>
<li>Maintenance: Sustaining ongoing maintenance throughout the validators' lifespan, which involves monitoring performance, troubleshooting issues, and applying necessary updates.</li>
</ul>

What is required to be a Node Operator in CSM?

Node operators benefit from:
<ul>
<li>Daily Bond Rebase: The collateral for CSM NOs is eligible for <a href="https://help.lido.fi/en/articles/5230610-what-is-steth" target="_blank" rel="nofollow noopener">rewards through stETH's rebase</a>, even before validator activation.</li>
<li>Socialized Rewards: Rewards are smoothed across the largest validator set, mitigating volatility. This means that even in the event of small outages or disruptions, node operators can still receive rewards, reducing the risk of rewards loss.</li>
</ul>

What do node operators receive in CSM?

Node operators face several risks, including:
<ol>
<li>Technical Risk: Maintaining reliable and secure hardware and software setups is essential. Any technical failure or vulnerability in the validator setup could lead to penalties.</li>
<li>Penalties for Misbehavior: Validators can be penalized for various reasons, such as going offline or attempting to manipulate the network.</li>
<li>Market Risk: The value of ETH can fluctuate significantly, impacting the value of the validators' staked ETH.</li>
<li>Network Risk: Validators are part of a decentralized network, and the security and stability of the Ethereum network as a whole can affect individual validators. Events such as network attacks or protocol upgrades may impact validator operations, leading to potential disruptions or losses.</li>
<li>Operational Risk: Validators require ongoing maintenance and monitoring to ensure smooth operation. Any operational issues, such as hardware failures or connectivity issues, could disrupt validator performance and result in rewards losses.</li>
<li>Slashing Risk: Validators can be slashed, meaning they lose a portion of their staked ETH, for violating network rules or behaving maliciously. Slashing can occur due to actions such as double signing or failing to validate correctly, resulting in significant penalties.</li>
</ol>

What are the risks of running a validator?

Refer to <a href="https://blog.lido.fi/lido-community-staking-an-overview/" target="_blank" rel="nofollow noopener">the CSM blog post</a> for an overview, or <a href="https://operatorportal.lido.fi/modules/community-staking-module" target="_blank" rel="nofollow noopener">the CSM page</a> for a more detailed explanation of its mechanics and functionalities.

How does CSM work?

CSM provides several unique features to attract and benefit community stakers:
<ul>
<li>Rewards Smoothing: Rewards, including Execution Layer (EL) rewards and MEV, are smoothed with other modules to provide more stable rewards comparable to operating validators solo.</li>
<li>Low Bond Requirement: A low bond for node operators makes participation more accessible to a broader range of prospective operators.</li>
<li>Exclusive Use of ETH (stETH): CSM exclusively uses ETH ((w)stETH) for bond and rewards, eliminating the need for other assets and simplifying the process for node operators. The bond can be submitted as ETH, wstETH, or stETH, and both bond and rewards can be withdrawn in any of the three forms (withdrawals in the form of ETH follow the <a href="https://help.lido.fi/en/articles/7858323-how-do-i-unstake-my-steth" target="_blank" rel="nofollow noopener">normal Lido on Ethereum unstaking process</a>).</li>
<li>Enhanced User Experience: Accessible through a multitude of options -- from a web UI to integrations with Dappnode, Stereum, Eth-Docker, Sedge, Stereum, CoinPillar, etc., CSM offers a leading user-friendly experience, with reduced gas fees for on-chain operations and simplified transactions for joining and claiming rewards.</li>
<li>Higher Reward Potential: Node operators are potentially able to earn more rewards compared to vanilla solo staking, making CSM an attractive option for operators looking to run more validators to earn rewards.</li>
</ul>

What makes CSM unique?

The initial bond requirement for the first validator for the testnet is 2 stETH. However, for <a href="https://operatorportal.lido.fi/modules/community-staking-module#block-ef60a1fa96ae4c7995dd7794de2a3e22" target="_blank" rel="nofollow noopener">Early Adopters</a>, this amount is reduced to 1.5 stETH to incentivize early participation.
Subsequent bond amounts depend on the total number of validators operated by the node operator and follow a specific function known as the “<a href="https://operatorportal.lido.fi/modules/community-staking-module#block-2d1c307d95fc4f8ab7c32b7584f795cf" target="_blank" rel="nofollow noopener">bond curve</a>”, which adjusts the bond requirement based on the operator's validator count.
For the testnet, the values for the bond curve are the following:
<img src="/assets/curve-common.png" alt="curve.png">

How much bond is needed?

The initial bond requirement for the first validator for the testnet is 2 stETH. However, for <a href="https://operatorportal.lido.fi/modules/community-staking-module#block-ef60a1fa96ae4c7995dd7794de2a3e22" target="_blank" rel="nofollow noopener">Early Adopters</a>, this amount is reduced to 1.5 stETH to incentivize early participation.
Subsequent bond amounts depend on the total number of validators operated by the node operator and follow a specific function known as the “<a href="https://operatorportal.lido.fi/modules/community-staking-module#block-2d1c307d95fc4f8ab7c32b7584f795cf" target="_blank" rel="nofollow noopener">bond curve</a>”, which adjusts the bond requirement based on the operator's validator count.
For the testnet, the values for the bond curve are the following:
<img src="/assets/curve-ea.png" alt="curve.png">

For community assistance, join the "<a href="https://discord.com/channels/761182643269795850/1255114351120089148" target="_blank" rel="nofollow noopener">CSM-testnet</a>" channel on the <a href="https://discord.com/invite/lido" target="_blank" rel="nofollow noopener">Lido Discord server</a> to seek advice and guidance.

CSM is paused on Holesky