Arbitrum DAO Unanimously Approves BoLD Protocol Upgrade to Enhance Network Security and Scalability

Arbitrum, Ethereum's largest layer 2 scaling solution, is set to enhance its ecosystem with the introduction of a groundbreaking upgrade designed to improve network security and mitigate transaction delays. The proposal, known as the Bounded Optimistic Liveness Dispute (BoLD) protocol, aims to resolve disputes more efficiently and open up Arbitrum’s validation process to a wider range of participants, reducing centralization in the network.

The proposal, which was published on January 6, is currently undergoing a final voting process through the Arbitrum Decentralized Autonomous Organization (DAO). At the time of writing, the proposal has gained unanimous support from the community. The voting period will conclude on January 24, with the upgrade scheduled for deployment on February 12, if approved.

The Current System and its Limitations

Arbitrum currently operates with two main chains: Arbitrum One and Arbitrum Nova. Arbitrum One, with a total value locked (TVL) of $17.7 billion, provides a general-purpose, cost-effective solution for running Ethereum-compatible smart contracts. Arbitrum Nova, on the other hand, focuses on applications that require higher transaction throughput, with a smaller TVL of $43 million.

At present, the Arbitrum network relies on a set of approved validators to verify transactions and prevent delays. These validators play a key role in maintaining network integrity, ensuring that fraudulent transactions are prevented and confirming the legitimacy of actions on the blockchain. However, this permissioned system has limitations, particularly when it comes to the speed and scalability of dispute resolution.

Introducing the BoLD Protocol

The BoLD protocol is designed to address these limitations by making Arbitrum's validation system permissionless, allowing anyone to participate in securing the network. Unlike the current system, which depends on a select group of validators, the BoLD protocol ensures that disputes are resolved within a fixed time period, addressing the risk of delay attacks and enhancing the overall speed and reliability of transaction processing.

In the current dispute resolution process, bad actors can exploit delays to stall the confirmation of transactions, causing network inefficiencies. By enforcing a fixed upper time bound of approximately 12.8 days for dispute resolution, BoLD seeks to eliminate the reliance on a permissioned validator set. The proposal states that this new approach "mitigates the risks of delay attacks" while ensuring faster and more efficient dispute resolution.

The BoLD protocol has already been operational on the Arbitrum testnet since April 2024, with positive results in terms of performance and dispute resolution.

Key Features of the BoLD Protocol

One of the standout features of the BoLD protocol is its censorship timeout mechanism, which is designed to address potential sequencer outages or censorship. The sequencer is responsible for processing and ordering transactions on the network. If the sequencer censors transactions or experiences an outage, the mechanism ensures that these issues do not significantly affect the network’s overall functioning.

For instance, Arbitrum One faced a 78-minute outage on December 15, 2023, due to a surge in network traffic that stalled the sequencer. The BoLD protocol aims to mitigate such issues by implementing a more robust and reliable dispute resolution process that operates independently of the sequencer.

Enhancing Arbitrum Nova’s Security

While the BoLD upgrade will enable permissionless validation on Arbitrum One, Arbitrum Nova will retain its permissioned model. The decision to maintain this permissioned approach for Nova is based on the chain's smaller TVL, which makes unrestricted validation less practical for the time being.

However, the proposal includes an important enhancement for Arbitrum Nova: the addition of Infura to its validator whitelist. Infura is a blockchain infrastructure provider that allows developers to access Ethereum nodes without running their own infrastructure. By including Infura as a validator, the proposal aims to increase the number of active validators on Arbitrum Nova, which will in turn strengthen the network’s security, stability, and reliability.

A Vision for a More Secure and Scalable Network

The approval of the BoLD protocol represents a significant step forward for the Arbitrum ecosystem. By introducing a permissionless validation system and improving dispute resolution, Arbitrum aims to enhance the security and scalability of its layer 2 network.

As the Ethereum blockchain continues to face challenges related to transaction throughput and network congestion, the BoLD protocol’s innovations are critical in ensuring that Arbitrum remains a reliable, fast, and efficient scaling solution for decentralized applications (dApps).

Conclusion

With unanimous support from the Arbitrum community, the BoLD protocol is poised to transform the way disputes are resolved and transactions are processed within the Arbitrum network. The move to a permissionless validation system for Arbitrum One and the enhancement of Arbitrum Nova’s security through the integration of Infura are key steps in making the network more decentralized, secure, and scalable. As Arbitrum continues to push the boundaries of Ethereum scalability, the BoLD upgrade sets the stage for a more efficient and user-friendly future for decentralized finance (DeFi) and beyond.

The final vote on the BoLD proposal will conclude on January 24, with the anticipated upgrade set for deployment on February 12, if approved.