# Divi 3.0 Explains Staking Vaults That Separate Validator Keys From Funds

> On June 25, 2023, the Divi Project published a detailed explanation of the validator vaults at the heart of its planned 3.0 upgrade. The design lets coins in an offline wallet act as staking weight for a separate, always-online validator. It was part of the run-up to an August fork that removed Divi's masternodes.

Source: https://cryptomorrow.com/2023/06/25/divi-3-0-explains-staking-vaults-that-separate-validator-keys-from-funds/
Last checked: 2026-11-08

The [Divi Project](https://www.diviproject.org) laid out a central part of its planned 3.0 blockchain upgrade on June 25, 2023: validator vaults, built to separate the work of producing blocks from the private keys that control the coins behind it. In a [blog post titled "Staking Vaults Revisited"](https://www.diviproject.org/divi-project-blog/divi-3-0-staking-vaults-revisited), the project pitched the design as "cold wallet security with hot wallet convenience" for people who want to support the network without leaving their holdings on an always-connected machine.

*Historical news event: 2023-06-25. Retrospective report prepared November 2026.*

The timing was pointed. The post opened by referring to two stories that had shaken crypto users that spring: Ledger's controversial key-recovery service and a large exploit of Atomic Wallet in early June 2023. Both, in Divi's telling, came back to the same principle, "Not Your Keys, Not Your Coins." It argued that "once your keys are given to someone else, they are no longer YOUR keys."

## The proof-of-stake trade-off

The design responds to an old problem in proof-of-stake networks. In proof of work, as the post explained, a miner's rewards can go to a separate address, even a paper wallet, so the funds sit away from the machine doing the work. In early proof-of-stake designs, by contrast, the coins that give a node its staking weight live in the same wallet as the node. Divi called these "hot" nodes: anyone who gets access to the validating machine also gets access to the funds.

[Staking](/2019/08/11/benefits-of-staking-over-mining-crypto/) is cheap to run compared with mining, but that co-location means security depends heavily on the owner's computer hygiene. The post named Neblio and Navcoin as networks that still worked that way at the time.

Masternode networks were one attempt at a fix, with collateral held in a separate wallet. Divi had run that model since its 2018 mainnet launch, which Cryptomorrow [reported at the time](/2018/10/05/divi-mainnet-has-already-launched/). But the post argued that in hybrid systems such as Dash, PIVX and Divi itself, disagreements between masternodes and stakers created instability, while the extra code added "great complexity to the overall network" without much benefit.

## How validator vaults work

![Divi diagram showing validator nodes marked V connected to each other, each linked to a separate blue wallet that funds it](/static/up/2023/06/cm-022-divi-validator-vault-network-diagram.webp)

*Image: [Divi Project](https://www.diviproject.org)*

Validator vaults return to the proof-of-work pattern. Coins sit in a vault that gives staking weight to a validator node, but the node itself can't spend them. According to the post, "the funds that comprise the staking weight for the validation node are not accessible even if the node itself is compromised." Rewards go back to the wallet that holds the staking funds, and that funding wallet can be shut down completely, which the project compared to keeping coins on paper or a hardware wallet.

Vaults weren't new to Divi. The project said they first appeared in Divi 2.0, and they reached users in a mobile wallet feature launched in October 2021. Co-founder and CEO Nick Saponaro told [Financial IT](https://financialit.net/news/payments/divi-introduces-mobile-staking-vaults-industry-first-crypto-wallets) at that launch: "There's no counterparty or middle-man risk as the user retains the coins and keys." What changed in 3.0 was the role of vaults. With masternodes gone, they would become the main way to take part in securing the network.

## Two ways to run a vault

The June post set out two arrangements. The first is a paid vault management service, which Divi Labs said it would provide: a user funds a vault, then turns off their own computer while the service keeps the validator running.

The second is a do-it-yourself setup between two computers, or even two accounts on one computer. It takes more technical work but is free and keeps the validator under the owner's control. Users could also keep running an ordinary hot staking node in the desktop wallet, as they had since Divi 1.0, though the post noted that this doesn't give the same security and requires the machine to stay on.

Either way, the word "vault" doesn't remove every risk. Security still depends on correct software, careful key management and sound configuration, and the post described Divi's own design rather than an independent audit of it.

## Why Divi was redesigning its network

The vault explanation was one instalment in a series about the move to Divi 3.0. The project's argument was that masternodes had never given Divi extra features, and that removing them would simplify the core code enough to build new ones. The post named subscriptions and escrow as features covered in later articles, and said a future Divi 4.0 would add side-chain functions. Those were development goals at the time, not shipped features.

The project also promised that the migration would run in steps over several weeks, with instructions to follow and "a gamification element" for node owners.

## What came next

The plan went ahead that summer. Divi's [hard fork retired masternodes](/2023/08/23/divi-3-0-fork-retires-masternodes-and-moves-rewards-to-validators/) on August 23, 2023, moving their share of the block reward to validators. The project's [rewards post](https://www.diviproject.org/divi-project-blog/divi-3-0-new-reward-distribution) said the 950 DIVI-per-minute block reward would stay the same; only its split would change. On October 26, 2023, Divi [declared the migration complete](https://www.diviproject.org/divi-project-blog/divi-3-0-migration-is-complete), saying more than 90% of the network had adopted version 3.0.0 within 7 weeks. That milestone is covered in [our report on the finished migration](/2023/10/25/divi-project-completes-version-3-0-migration-and-retires-masternodes/).

The June post was a design briefing rather than a token launch, but its point applies well beyond DIVI. In staking systems, holding coins and validating blocks are different jobs. Tools that let people separate them can make taking part safer, as long as users understand [how their wallets work](/2017/10/04/cryptocurrency-wallets-types/) and who controls the keys.

## Frequently asked questions

### What is a Divi staking vault?

A staking vault holds DIVI that gives staking weight to a separate validator node. The validator does the online work of producing blocks, but it can't spend the coins, and the wallet that funds the vault can stay offline.

### When did Divi remove masternodes?

Divi retired masternodes in its 3.0 hard fork on August 23, 2023. The project declared the migration to version 3.0.0 complete on October 26, 2023.

### Do you have to give your keys to someone else to use a Divi vault?

No. According to the Divi Project, the funding wallet keeps its keys. Users can pay for a vault management service from Divi Labs or set up a vault themselves between two of their own computers or accounts.

### Were staking vaults new in Divi 3.0?

No. The project said vaults first appeared in Divi 2.0, and mobile staking vaults launched in October 2021. Divi 3.0 made them the main way to take part in validation after masternodes were removed.

## Sources

- [Divi Project, "Divi 3.0 | Staking Vaults Revisited" (June 25, 2023)](https://www.diviproject.org/divi-project-blog/divi-3-0-staking-vaults-revisited)
- [Divi Project, "Divi 3.0 New Reward Distribution" (August 23, 2023)](https://www.diviproject.org/divi-project-blog/divi-3-0-new-reward-distribution)
- [Divi Project, "Divi 3.0 migration is complete!" (October 26, 2023)](https://www.diviproject.org/divi-project-blog/divi-3-0-migration-is-complete)
- [Financial IT, "Divi Introduces Mobile Staking Vaults, an Industry-First for Crypto Wallets" (October 4, 2021)](https://financialit.net/news/payments/divi-introduces-mobile-staking-vaults-industry-first-crypto-wallets)

*Featured image: [Divi Project](https://www.diviproject.org)*