Noble XYZ, a Cosmos-based general asset issuance chain, has paused integration with Interchain Security due to slashing concerns.
Interchain Security — also known as Replicated Security — allows the Cosmos Hub to run multiple blockchains in parallel, all while using the same security attributes.
Validators are able to secure different app chains through staking ATOMs, but when a validator engages in dishonest behavior, they will be penalized, or “slashed.”
The initial slashing strategy for Interchain Security was that a validator would automatically be punished if they did something wrong. A change was made so that slashing would be executed through governance, the Blockworks Research team explained.
In the new strategy, consumer chains must send a “slashing packet” to Cosmos Hub and the ATOM community governance will be able to vote on whether a validator should be axed.
This decision was made so that in the case that fault code is in a new chain, validators would not be immediately punished for it.
“Replicated Security is still nascent tech and as a security precaution, it makes sense to go the safer route via governance-gated slashing,” they said.
Due to concerns that a bad actor could potentially rally support to slash a validator through governance even without participating in dishonest behaviors, Noble XYZ has chosen to launch as a “proof of authority” chain with a trusted validator set.
“The Proof of Authority model provides real economic cost to faulty validator behavior and thus provides economic security to the network that can be computed in real-time based on past and projected fees,” the company said on its GitHub page.
Noble XYZ noted it would continue to monitor Interchain Security developments and ensure it remains up to date with the latest security standards.
“This is a big blow to the Hub’s Replicated Security go-to-market (GTM) strategy,” Blockworks Research said. ”Noble would’ve aligned ATOM value accrual with the growth of the Interchain.”
Though this is the case, these are just the company’s initial plans. It’s hoped that once automated slashing is incorporated into Replicated ecurity, Noble will decide to re-align itself with the Hub.