Add EIP: Anti-correlation attestation penalties

EIPS/eip-7716.md

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+---
+eip: 7716
+title: Anti-correlation attestation penalties
+description: Adjust penalties for missed attestations based on in-slot correlation of missed attestation
+author: dapplion (@dapplion), Toni Wahrstätter (@nerolation), Vitalik Buterin (@vbuterin)
+discussions-to: https://ethereum-magicians.org/t/eip-7716-anti-correlation-attestation-penalties/20137
+status: Draft
+type: Standards Track
+category: Core
+created: 2024-05-25
+---
+
+
+## Abstract
+
+The decentralization of the validator set is one of the most important properties of Ethereum for credible neutrality and censorship resistance. By adjusting penalties to foster decentralization, diversification and fault-tolerance, this EIP proposes to adjust penalties in a way that more diversified entities get lower penalties while entities with high correlations in their setup face more servere ones.
+
+
+## Motivation
+
+As of now, during times of usual network operation, there are no economic incentives to diversify node operations through using multiple different nodes, geographical locations, clients, ISP providers, etc., except for reducing the risk of penalties affecting all validators simultaneously, thereby limiting the impact to only a fraction of them. 
+
+Attestation penalties are currently agnostic to other participation actions. This proposal scales attestation penalties as a function of other participants' actions. The goal is to decrease the profitability of participants that exhibit correlated behavior.
+
+
+
+## Specification
+
+| Parameter | Value |
+| - | - |
+| `PENALTY_ADJUSTMENT_FACTOR`    |  `4096` |
+| `MAX_PENALTY_FACTOR`    |  `4` |
+
+
+Add a variable `NET_EXCESS_PENALTIES` to the beacon state.
+
+Let `penalty_factor` be determined through 
+
+```
+min(
+    (non_attesting_balance * PENALTY_ADJUSTMENT_FACTOR) // (NET_EXCESS_PENALTIES * total_active_balance + 1), 
+    MAX_PENALTY_FACTOR
+)
+```
+
+Let `NET_EXCESS_PENALTIES` be `max(1, NET_EXCESS_PENALTIES + penalty_factor) - 1`
+
+
+
+## Rationale
+
+### PENALTY_ADJUSTMENT_FACTOR
+
+This variable impacts the sensitivity of the `NET_EXCESS_PENALTIES`.
+
+Given stable participation, the `penalty_factor` is one.
+If participation decreases, the `penalty_factor` will temporarily increase above one until `net_excess_penalties` catches up.
+If participation increases, the `penalty_factor` will temporarily be zero until `net_excess_penalties` catches up.
+
+The `PENALTY_ADJUSTMENT_FACTOR` regulates how fast `net_excess_penalties` catches up.
+In other words, the `PENALTY_ADJUSTMENT_FACTOR` determines the frequency that the penalty_factor is not one.
+
+A high `PENALTY_ADJUSTMENT_FACTOR` causes the `net_excess_penalties` to adjust slower.
+A low `PENALTY_ADJUSTMENT_FACTOR` causes the `net_excess_penalties` to react more sensitive to changes in participation.
+
+
+### `MAX_PENALTY_FACTOR`
+
+The `MAX_PENALTY_FACTOR` puts a ceiling onto the maximum factor with which the penalty for missed attestations is scaled to prevent overly harsh punishments.
+
+
+## Backwards Compatibility
+
+This is a backwards incompatible adjustment of attestations rewards and penalties that requires a scheduled network upgrade.
+
+
+## Security Considerations
+
+We acknowledge that splitting validator views can be leveraged as an attack to increase the `penalty_factor` for validators of consecutive slots with little risk for the proposer. 
+TBD.
+
+## Copyright
+
+Copyright and related rights waived via [CC0](../LICENSE.md).
+