What does "participation rate" mean in the context of ETH2?

Question

https://decrypt.co/41503/how-an-attacker-might-try-to-break-ethereum-2-0?utm=facebook

Jelurida co-founder Lior Yaffe claims that a low participation rate could allow whales to crash the network. But an Ethereum developer says the attack would be much more expensive.

Yaffe considered a situation where the network participation rate is low and some whales are quietly using multiple accounts. Since the network has a minimum participation rate of 66%, if a whale drops out suddenly—knocking it below this threshold—it could cause issues. And if there’s not much money being staked, this could be surprisingly feasible.

“Let’s assume that 10% of the ETH is now staking and that network participation is 75% (which is pretty much what we see on testnet now). In this case to drop the participation rate by 9% to halt the chain only requires control of 0.9% of the ETH in circulation. Certainly achievable by a large whale or a mid size exchange,” Yaffe told Decrypt.

“So all you need in order to stop the network maliciously, is to hold the difference between the current participation level [and] 66%,” he added.

What does "participation rate" mean?

Answer 1

The participation rate is the percentage of validators that are online and performing their duties.

The following is a simplified example for the rest of this answer. If the validator set is 1,000 validators, and 250 validators are offline or rarely making proposals or attestations, then it could be estimated that the participation rate is 75%.

Finality requires consensus of 2/3 of the validator set. If a whale controlling 100 validators decides to turn them off, then with only 650 validators remaining, finality would be temporarily halted. (650 is less than 2/3 of 1000.)

Finality would be restored when the inactivity leak drains the 350 offline validators. The validator set would then be 650 validators, roughly 100% participation, and the beacon chain proceeds as usual.