This is not a DAO proposal; it’s the result of research and community feedback intended to initiate a community discussion by SSV.labs.
1. Background: Unprecedented Growth
Over the past year, the SSV Network has grown at an unprecedented pace — reaching over 5 million ETH staked, making it the second largest validator infrastructure network globally, currently operating ~14% of staked ETH. With major integrations coming, SSV could reach 8–10 million ETH in 2026.
This growth underscores SSV’s success as the backbone for Ethereum validator distribution and resilience. However, despite the rapid expansion in staked ETH and network’s potential, the SSV token has become detached from both the network’s growth and the broader ETH market.
This paper proposes a staking model designed to reconnect the SSV token to its underlying fundamentals and position SSV as an ETH Accrual Token for the wider Ethereum community.
2. Current State: Fee Structure
At present, the SSV protocol charges a 1% network fee on validator rewards, denominated in SSV tokens.
By contrast, the Incentivized Mainnet (IM) program gives a higher rate of 5%, also in SSV.
| Effective Balance (ETH) Tier | APR Boost |
|---|---|
| 3,200,032 – 4,000,000 | 7.50% |
| 4,000,032 – 4,800,000 | 6.00% |
| 4,800,032 – 5,600,000 | 5.00% |
| 5,600,032 – 6,400,000 | 4.25% |
| 6,400,032 – 7,200,000 | 3.50% |
| 7,200,032 – 8,000,000 | 3.00% |
| 8,000,032 – 9,600,000 | 2.50% |
While this SSV-based rewards system initially served as a growth catalyst, it introduced volatility for operators, as SSV’s price fluctuates independently of ETH. Moreover, because SSV fees are paid in a token not directly linked to validator rewards (which is in ETH), the network’s economic flywheel remains partially disconnected.
3. Realigning Network Economics
The post aims to explore realigning network economics to its growth by suggesting 3 changes for the ssv.network DAO to consider:
(1) Enable Network Fees denominated in ETH
Enabling network fees to be denominated and paid in ETH, the native asset of the validator ecosystem.
This ensures:
- Predictable fees for operators (no SSV/ETH conversion risk)
- Direct linkage between protocol growth and validator sustainability
- Stable, transparent pricing for institutions integrating SSV
(2) Gradual Fee Increase to 1.5% of ETH Rewards
The base fee should be steadily raised (until EOY 2026) from 1% to 1.5% of validator ETH rewards
This phased increase allows:
- Smoother market adaptation
- Ongoing accumulation of ETH-denominated revenue
- Predictable commitment from stakers and token holders
Based on 10M staked SSV, ETH APR 2.9%
(3) SSV Staking
SSV holders will be able to lock their tokens in a dedicated contract. These tokens will serve as a backstop for any potential protocol failures in the future, as determined by the DAO. In return for participating in the backstop pool, they will receive 100% of the ETH collected from network fees.
The new SSV staking mechanism introduces a dual purpose for the token:
- ETH Funneling/Utilization — All ETH collected via network fees will be distributed to SSV stakers, proportionally to their stake. This effectively turns stakers into ETH rewards participants based on protocol activity.
- Network Security Backstop — Staked SSV acts as a first-responder pool in the event of any protocol-level failure (though unlikely), covering damages or slashing-related events.
This dual design creates a direct link between:
- ETH rewards growth (from validators and TVL expansion), and
- SSV token utilization and staking participation.
Based on SSV at $35 (previous high EOY 24’)
For more information and simulations on potential ETH APR please visit https://ethaccrualtoken.com/
5. Economic Objectives
The updated fees and staking system aims to:
- Re-align incentives
across all network participants
Validators, operators, and token holders now share exposure to ETH-denominated growth. - Create structural utilization for SSV
Users must acquire and stake SSV to earn ETH rewards and secure the network. - Re-couple SSV token fundamentals to network adoption
Token fundamentals will now scale with total ETH staked and validator performance, re-establishing a clear, rational link between SSV, network activity, and the broader Ethereum economy. - Reduce volatility and friction
By eliminating SSV-denominated fees and introducing ETH-based rewards, the protocol becomes more predictable and institution-friendly.
6. Conclusion
By transitioning to ETH-based fees and introducing SSV staking as a sustainability and security mechanism, the SSV Network can evolve into a fully self-sustaining, fundamentals driven infrastructure protocol.
This model aligns the interests of all participants — operators, validators, and token holders — while ensuring that SSV’s token value is firmly coupled to ETH rewards, total staked TVL, and overall network health.