How do you implement distributed tracing with gRPC?

Distributed tracing in gRPC uses OpenTelemetry (the standard) to propagate trace context across service boundaries. Implementation: (1) Instrument the gRPC server and client with OpenTelemetry gRPC instrumentation libraries (e.g., go.opentelemetry.io/contrib/instrumentation/google.golang.org/grpc/otelgrpc); (2) Interceptors — the OTel library provides interceptors that extract/inject trace context from/into gRPC metadata. The server interceptor extracts the traceparent header (W3C format) from incoming metadata and creates a child span; the client interceptor injects the trace context into outgoing metadata; (3) Exporter — send spans to a collector (Jaeger, Zipkin, Tempo) via OTLP protocol; (4) Service mesh tracing — Envoy (Istio) can add tracing headers automatically, but to trace within the application (handler-level spans), OTel instrumentation in application code is needed; (5) Sampling — in production, use tail-based sampling to capture 100% of error traces while sampling successful traces at lower rates.