In the crypto space, security remains a paramount concern. As Bitcoin continues to dominate the market, ensuring its security and usability is crucial for its sustained growth and adoption. This is where the Pell Network comes into play.

The Pell Network is designed to enhance the security and functionality of the Bitcoin ecosystem. By introducing innovative mechanisms like restaking and actively validated services, Pell Network aims to bridge the security gaps between Bitcoin’s layer 1 and layer 2 solutions.

What is Pell Network?

Source: Pell Network Website

The Pell Network is an innovative protocol designed to enhance the security and usability of the Bitcoin ecosystem. It introduces a staking mechanism that allows Bitcoin holders to secure the network while earning rewards. This approach not only strengthens Bitcoin’s security but also provides additional utility for Bitcoin holders.

Background and Development History

The Pell Network was conceived to address the growing need for enhanced security in the Bitcoin ecosystem. As Bitcoin’s popularity surged, so did the challenges associated with securing its network. Traditional layer 1 and layer 2 solutions often left gaps that could be exploited. The developers behind Pell Network recognized these vulnerabilities and set out to create a solution that would bridge these gaps effectively.

Key Features and Functionalities

Pell Network boasts several key features that set it apart from other security solutions:

1. Restaking Mechanism: Bitcoin holders can restake their assets, providing additional security to the network while earning rewards.

2. Decentralized Operators: Pell Network leverages a decentralized network of operators to ensure the integrity and security of transactions.

3. Actively Validated Services (AVS): These services actively monitor and validate transactions, enhancing the overall security of the network.

4. Service Usage Layer: This layer facilitates the interaction between users and the network, ensuring seamless and efficient operations.

The Need for Pell Network

Pell Network is designed to bridge the security gaps between Bitcoin’s layers and address the broader challenges of the ecosystem:

1. Enhanced Security: By introducing a restaking mechanism, Pell Network allows Bitcoin holders to contribute to the network’s security. This additional layer of security helps protect against sophisticated attacks.

2. Improved Scalability: Pell Network’s decentralized operators and actively validated services (AVS) ensure that transactions are processed efficiently without compromising security. This helps alleviate congestion and reduce transaction fees.

3. User-Friendly Interfaces: Pell Network aims to simplify the user experience by providing intuitive tools and interfaces. This makes it easier for new users to interact with Bitcoin and participate in the network.

4. Interoperability: The service usage layer of Pell Network facilitates seamless interaction with other blockchain networks and dApps. This enhances Bitcoin’s utility and integration within the broader crypto ecosystem.

Key Components of Pell Network

Pell Restaking Protocol

The Pell Restaking Protocol is the backbone of the network. It allows Bitcoin holders to restake their assets, contributing to the network’s security while earning rewards. This protocol ensures that the network remains secure and resilient against attacks.

Pell Marketplace

The Pell Marketplace is a decentralized platform where users can buy and sell services related to the network. This marketplace facilitates the exchange of services, making it easier for developers and users to access the tools they need to build and interact with the network.

Pell Restaking Ledger

The Pell Restaking Ledger is a transparent and immutable record of all restaking activities within the Pell restaking protocol. It ensures accountability and transparency, allowing users to verify the integrity of the network and their contributions.

Pell Network Client

The Pell Network Client is the interface through which users interact with the network. It provides a user-friendly experience, making it easy for both beginners and intermediate users to participate in the network’s activities.

Pell Network Workflow

Restaking Layer

The Restaking Layer lets users stake their Bitcoin (BTC) or Liquid Staking Derivatives (LSD) on the Pell Network. By doing so, they earn returns while contributing to the network’s security. This layer is crucial as it incentivizes users to participate in securing the network, thereby enhancing its overall robustness.

Decentralized Operators

Decentralized Operators manage the validation nodes within the Pell Network. These operators provide active verification services, ensuring the security and integrity of transactions. They are responsible for validating transactions, maintaining the network’s ledger, and distributing profits to stakers according to established rules. By decentralizing these operations, Pell Network ensures that no single entity can control the network, enhancing its security and reliability.

Actively Validated Service (AVS)

The Actively Validated Service (AVS) is a critical component that offers various infrastructure and services for synchronized ecosystem modules. These services include oracles, cross-chain bridges, RPC nodes, application chains, data availability services, and Rollup sorters. AVS actively monitors and validates transactions, providing an additional layer of security and ensuring that all activities within the network are legitimate and secure.

Service Usage Layer

The Service Usage Layer facilitates user interaction with the Pell Network. It provides secure validation services to external Bitcoin layer-2 network ecosystems. This layer ensures that users can easily access and utilize the network’s services, making the overall experience seamless and efficient.

How These Components Work Together

The integration of these components creates a multi-layered, high-efficiency, and secure Bitcoin ecosystem network. Here’s how they work together:

1. Staking and Restaking: Users stake their BTC or LSD on the Restaking Layer, contributing to the network’s security and earning returns.

2. Validation and Security: Decentralized Operators manage validation nodes, providing active verification services and ensuring the integrity of transactions.

3. Infrastructure and Services: AVS offers essential infrastructure and services, such as oracles and cross-chain bridges, to support the network’s operations.

4. User Interaction: The Service Usage Layer facilitates seamless interaction between users and the network, providing secure validation services to external ecosystems.

Pell Restaking Mechanism

Restaking in Pell Network involves validators staking their Bitcoin (BTC) or Liquid Staking Derivatives (LSD) to secure the network. They participate in the network’s security processes and earn rewards by doing so.

Forms of Restaking in Pell Network

Pell Network offers several forms of restaking, each linked to different layers of the blockchain:

1. Native Restaking: Validators can restake their BTC by directing their withdrawal credentials to the Pell Network contract. This creates a direct Bitcoin to Pell Network revenue stack.

2. LSD Restaking: Validators can restake their LSD (BTC already restaked through another protocol) by transferring their LSD to a Pell Network smart contract. This forms a DeFi to Pell Network revenue stack.

3. BTC LP Restaking: Validators stake a pair of LP tokens containing BTC. This is another form of DeFi to Pell Network revenue stack.

4. LSD LP Restaking: Validators stake a pair of LP tokens containing a liquidity-staked BTC token. This creates a Bitcoin to DeFi to Pell Network revenue stack route.

Pell Network Staking Mode

Stakers have two primary options to participate in the Pell Network:

1. Independent Stakers: These stakers can opt into AVS on Pell Network, directly providing verification services. By doing so, they actively contribute to the network’s security and earn rewards.

2. Delegated Stakers: Independent stakers can delegate their Pell Network operations to different Pell Network node operators. This delegation allows stakers to earn rewards without directly managing the verification services.

Pell Delegation Mechanism

The Pell Network provides a flexible delegation mechanism for restakers who prefer not to operate validation nodes. This mechanism allows them to delegate their BTC or LSD to other entities running Pell Network operator nodes. These entities are called operators and are responsible for ensuring the security and integrity of the network while managing the validation node. They charge fees for their services, retaining a small portion and distributing the remainder to the delegators.

However, this model requires restakers to trust their chosen operators. If an operator fails to fulfill their obligations, the staked deposits of these operators will be slashed. Consequently, restakers who have delegated their stakes to these operators will also face slashing. Therefore, restakers must conduct thorough due diligence on the operators they choose to delegate to.

Slashing

Slashing quantifies the cost an adversary must bear to compromise the network’s security attributes, known as the Cost of Corruption (CoC). When the CoC significantly exceeds any potential profit from causing harm (Profit from Corruption, PfC), the system is considered to have robust security.

Pell Network’s smart contracts control the withdrawal credentials of stakers’ assets. If a restaker engages in adversarial actions while participating in an Actively Validated Service (AVS), their staked assets will be subject to slashing. The withdrawal addresses for stakers are set to the Pell Network contract, ensuring that any assets withdrawn are reduced according to the on-chain slashing rules of the AVS. This automatic application of economic penalties helps maintain the network’s integrity.

Tiered Actively Validated Services

Pell Network achieves the highest level of security when all assets restaked through the network support specific Actively Validated Services (AVS). However, this approach presents two main challenges:

1. Revenue vs. Operating Costs: Ensuring that the expected revenue from AVS can cover the operating costs for operators.

2. Computing Resources: Ensuring that operators possess sufficient computing resources to participate in the verification of AVS.

To address these concerns, Pell Network proposes two potential solutions through the design of different modules:

1. Large-Scale AVS: In a large-scale AVS, the total computational workload is evenly distributed across all participating operator nodes, a method known as horizontal scaling. This makes the total cost of storing data comparable to storing it by only two nodes. The data processing demands on each node might be low, yet the overall system can achieve high throughput by aggregating performance across multiple nodes.

2. Lightweight AVS: Lightweight AVS includes tasks that are redundantly performed by all operators but at very low costs. The computational demands and infrastructure requirements for these tasks are very low, making them suitable for operation on the Pell Network.

This approach ensures that even individually operated validators can gain substantial economic benefits from Pell Network, effectively reducing the pressure of centralization on staking.

Getting Started with Pell Network

How to Restake BTC Cross-Chained to Bitlayer

Before you begin, ensure you have cross-chained BTC and a compatible wallet.

1. Open the Pell Network website Network and click on “Connect Wallet.”

1. Choose the EVM wallet where your cross-chained BTC is stored and click “Connect.”

1. Click “Points” to access the points interface. Complete the regular tasks listed to earn Pell points after verification.

1. Once you have earned the points, click “Restake” to begin the BTC restaking process. You will see all the BTC types available for restaking.

1. Click the “Bitlayer” button to view the WBTC and aWBTC pledge list. Click “WBTC” to enter the WBTC re-pledge page.

1. Select “Deposit” and enter the amount of BTC you wish to restake in the Staking Amount field.

1. Click “Stake” to proceed to the wallet signature confirmation page. Click “Confirm” to complete the signature.

1. After the wallet confirms, wait a few seconds. When “All done” appears, your BTC restaking is complete.

2. You can now see the amount of BTC you have pledged in the Restaked column. Congratulations on successfully joining the Pell Network!

How to Restake BEVM Assets on Pell Network

Since BEVM is a Layer 2 solution for BTC supported by Pell Network, you need to bridge your Bitcoin to BEVM on the official BEVM bridge.

1. Ensure you have bridged BTC on BEVM and a compatible wallet

2. Select an EVM-supported wallet that stores your bridged BTC and click “Connect” to complete the connection.

1. Click “Points” to enter the points interface. After verification, complete the regular tasks to earn Pell points.

1. After earning the points, click “Restake” to start the BTC restaking process. View all the BTC types available for restaking.

1. Click the “BEVM” button to view the WBTC, wstBTC, and stBTC staking lists. Click “WBTC” to enter the WBTC restaking page.

1. In the WBTC restaking interface, select “Deposit” and enter the amount of BTC you want to restake in the staking amount field.

1. Click “Stake” to proceed to the wallet signing confirmation page. Click “Confirm” to complete the signing.

1. After the wallet confirmation, wait a few seconds. When you see the “All done” message, your BTC restake is successfully completed.

1. Check the amount of BTC you have restaked in the “Re-staking” section. Congratulations on joining the Pell Network!

Conclusion

Pell Network significantly enhances Bitcoin’s security and usability through innovative mechanisms like restaking and Actively Validated Services (AVS). Participating in Pell Network, you can contribute to securing the Bitcoin ecosystem while earning rewards. We encourage you to explore and engage with Pell Network, helping drive the future of decentralized finance and blockchain technology.