Ethereum protocol Heroglyphs takes inspiration from Bitcoin mining to fix token distributions

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Quick Take

A white paper for the Heroglyphs Protocol was unveiled late Wednesday, designed to incentivize Ethereum solo stakers with new tokens by mimicking elements of proof-of-work systems.
Pseudonymous co-author Manny said Heroglyphs’ launch was coming on Friday.

A white paper for a new protocol called Heroglyphs was unveiled late Wednesday, aiming to incentivize Ethereum solo stakers with new tokens by mimicking elements of proof-of-work systems.

“Excited to share v0 of the Heroglyphs white paper. Heroglyphs is designed to reward solo stakers, adding a bit of PoW into Ethereum’s PoS [proof-of-stake],” pseudonymous co-author Manny said.

The co-authors, also including former Sushi core contributor 0xMaki, argue that fair crypto token distribution mechanisms have been missing since Ethereum moved away from a proof-of-work consensus mechanism in September 2022. Plus, they argue that liquid staking protocols — which have becoming increasingly popular — may concentrate control in the hands of a few people, potentially undermining the decentralized nature of the network. They want to fix this by encouraging more decentralized and resilient validation through proof-of-work-esque token rewards.

"Heroglyph mining ensures that all complete validators receive rewards for their participation, regardless of their staking size or whether they are selected as block proposers,' the authors said.

Users can create tokens and specify their total supply, specific emission schedule and initial distribution. By enabling only complete validators to mine these new tokens, Heroglyphs aims to provide a level playing field, reducing the dominance of large node operators and supporting smaller validators.

However, they are not advocating for a return to the energy-intensive processes typical of traditional proof-of-work systems. In this context, "mining" is metaphorical, referring more to the issuance of tokens as rewards rather than actual computational mining. “Our goal is not to overthrow liquid staking. Rather, we wish to increase Ethereum’s security by helping to reverse the consolidation of validation and associated information privileges in a small number of validators,” the authors concluded.

Co-author Manny said the Heroglyphs’ white paper V1 and launch was coming on Friday.

Disclaimer: This article was produced with the assistance of OpenAI’s ChatGPT 3.5/4 and reviewed and edited by our editorial team.

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James Hunt is a reporter at The Block, based in the UK. As the writer behind The Daily newsletter, James also keeps you up to speed on the latest crypto news every weekday. Prior to joining The Block in 2022, James spent four years as a freelance writer in the industry, contributing to both publications and crypto project content. James’ coverage spans everything from Bitcoin and Ethereum to Layer 2 scaling solutions, avant-garde DeFi protocols, evolving DAO governance structures, trending NFTs and memecoins, regulatory landscapes, crypto company deals and the latest market updates. You can get in touch with James on Telegram or 𝕏 via @humanjets or email him at [email protected].