Lido Engineer Warns of Deposit Hijacking Risk in Glamsterdam Upgrade

Mars Finance reports that Dmitry Gusakov, Engineering Lead at Lido, the Ethereum liquid staking protocol, warned at the ACDC #189 developer meeting that the one-time builder access mechanism introduced in the Glamsterdam upgrade could disrupt the existing deposit protection logic of staking protocols, potentially leading to hijacked staked deposits. The issue involves multiple deposits sharing the same validator public key. Under Ethereum’s current deposit rules, the first valid deposit determines the withdrawal credentials, and staking protocols typically leverage this feature to prevent credential manipulation—for example, by initially depositing a small amount of ETH and later topping up the remainder once the validator appears with the expected credentials. However, the special access mechanism introduced for builders in Glamsterdam may alter how subsequent pending deposits under the same public key are interpreted during the fork transition, exposing staking protocols to a third outcome: the validator never appears, and the deposited ETH is credited to the builder. Lido proposed a fix to preserve the distinction between validator deposits and builder deposits during the one-time access process. However, core developers rejected the change due to timing concerns, primarily because the Sepolia testnet has already been activated under the current specification, and the Hoodi client version is already in preparation; altering behavior at this stage would require redeploying Sepolia and conducting additional testing. While this issue affects only the access process during the fork transition—not the ongoing deposit handling rules—its consequences could impact deposits currently in queue.