It’s Time to Grow: Phase 3 Staking Proposal

[Adrian Dobrita 19]

13 hours ago, EGod said:

When does phase 3 begin?

Most probably sometime in February (I estimate end of February - early March).

The date is not fixed as we have been focusing mostly on testing the features required for Maiar launch which comes first.

The implementation for phase 3 is already done and some testing has been performed but we still need/planned more testing and it also depends on what kind of issues we still find.

[Adrian Dobrita 19]

13 hours ago, Milan Kraus said:

1. Can also the base 2500 EGLD come from delegators? Or does it always need to be provided by validator?

2. If it can come from delegators and they undelegate so a node has less than 2500 EGLD stake, will the node be automatically deactivated?

3. I'm not sure whether slashing is already enabled, but once it will be, will it affect also delegators? If yes, it will be quite risky to lock delegation for a period of time - delegator will not be able to react to validator that starts to misbehave.

 

 

Hi Milan,

1. If you run a staking service (accept delegations) there is a delegation manager contract that allows you to create your own delegation contract with your preferred configuration (service fee, delegation cap, etc). For this you need to come with 1250 eGLD yourself, which will be the first delegated amount (your own delegation) and is required in order to keep your delegation contract active. Everything else can come from other delegators.

2. Yes the node will be deactivated by the protocol while the staked amount is below the minimum required. If in the meantime there is one delegation that causes the staked amount to exceed the min required, then the node will be re-activated.

3. Slashing is currently not enabled, but the intention is to have less impact on delegators (could be 0) and more impact on provider. This is still TBD and there will be a proposal before we activate the feature so we can discuss and reach the best decision.

At point 3 could you explain which lock you were talking about? Is this about the requested features for delegation SC for min lock period, where in exchange for longer lock time the service provider could have lower fees?

The way that will be designed is that delegators have a guarantee for lower service fees while they abide by the agreed lockup. The funds can be withdrawn any time nevertheless, with some penalties on the rewards for the last period if there is a breach of the agreed lockup. One thing we are trying to implement here is correctly defining the constraints for both parties, delegators and service providers. So if we have a breach of contract from the delegator, its rewards for the the last period have a penalty, while on the other side, if for example the service provider gets slashed, or changes anything with the agreed delegation contract parameters that negatively affects the delegation APR, then delegators can withdraw without any penalties.

 

[Adrian Dobrita 19]

13 hours ago, Milan Kraus said:

1. Can also the base 2500 EGLD come from delegators? Or does it always need to be provided by validator?

2. If it can come from delegators and they undelegate so a node has less than 2500 EGLD stake, will the node be automatically deactivated?

3. I'm not sure whether slashing is already enabled, but once it will be, will it affect also delegators? If yes, it will be quite risky to lock delegation for a period of time - delegator will not be able to react to validator that starts to misbehave.

 

 

For 1 there is also the option for you to not go through the provided delegation manager contract and create your own delegation Smart Contract, where you can set your own rules, no minimum delegated amount from staking provider, etc., but here all the coding/gas optimization/validation/testing/auditing efforts will be on your side, which is really important as the risk for loss of funds in case of bugs is high.

We have already spent a lot of time for the coding/testing/auditing etc of the delegation manager system SC and more will follow on the testnet, so for the people that do not have both the required experience and time to develop and test a safe to use delegation smart contract, we advice to use the provided delegation manager system SC.

[Milan Kraus 0]

Hi @Adrian Dobrita excellent, thank you

[Disruptive Digital 0]

I need more clarification regarding Staking Provider registration deposit. I assume the SP registration deposit (baseDeposit) will accrue rewards for the SP itself, right?

For example: SP registers a DSSC and deposits 1250 eGLD. Then receive from delegators another 1250 eGLD. The registered node becomes a validator node and starts earning rewards. Half of the total rewards minus the SP fee will go to the delegators and the other half goes to SP?

[Nod 0]

Hello members and team,

 

Currently in the delegations queue but with a very healthy amount of EGLD on the waiting list. 

I have two questions. 

 

1. I would like to wait to become an active delegator. With phase 3 coming towards February, what happens to the thousands in the queue? The nodes increase would that mean more EGLD will become active? 

 

2. Stake providers have certain contact lengths, 12 months, 24 months etc.. What happens after that period? Is our EGLD locked away or is the standard 10 day unbonding period relevant to this too? 

 

Thanks. 

[Adrian Dobrita 19]

6 hours ago, Disruptive Digital said:

I need more clarification regarding Staking Provider registration deposit. I assume the SP registration deposit (baseDeposit) will accrue rewards for the SP itself, right?

For example: SP registers a DSSC and deposits 1250 eGLD. Then receive from delegators another 1250 eGLD. The registered node becomes a validator node and starts earning rewards. Half of the total rewards minus the SP fee will go to the delegators and the other half goes to SP?

The deposit will accrue rewards for the SP only if it becomes part of a node stake. If for example the delegation amount + SP deposit <2500 eGLD then it would not receive rewards, as there will be no eligible node to earn rewards.

As soon as there is at least one eligible validator with stake from the delegation SC, then the original deposit will also accrue rewards just as you mentioned.

[Adrian Dobrita 19]

4 hours ago, Nod said:

Hello members and team,

 

Currently in the delegations queue but with a very healthy amount of EGLD on the waiting list. 

I have two questions. 

 

1. I would like to wait to become an active delegator. With phase 3 coming towards February, what happens to the thousands in the queue? The nodes increase would that mean more EGLD will become active? 

 

2. Stake providers have certain contact lengths, 12 months, 24 months etc.. What happens after that period? Is our EGLD locked away or is the standard 10 day unbonding period relevant to this too? 

 

Thanks. 

1. The queue/waiting list will no longer be incentivized, but at the same time more "seats" will be available for staking and the delegation manager will be available for staking providers.

At this point we might see some migration from active delegation and/or waiting list delegation to active delegation for staking providers. The nodes for the community nodes delegation will not be supplemented, so active delegation will only become available on the community delegation smart contract if someone with active delegation withdraws.

2. The option for staking providers to choose different lockups of 12 months, 24 months is not yet finalized and will not be available in the first phase3 release, so the behavior will be similar with the community delegation, with maybe different fees per staking provider.

When the different lockup period will be activated, then you could still undelegate within the 12/24 months, but there will be some penalty on the rewards. The unbonding time will be the standard 10 days, no matter if you did the undelegate within the lockup period or after. 

 

[kevin lallement 2]

Hello :)

There is something i cannot picture myself is :

How the "top-up" from the SP side will work ?

Does the SP need to create the DSC with (base stake + top up)

eg: 1250+1250 = 2500 so this way he could ensure that at least 1 node will run no matter how many egold are in delegation ?

Or does any "external wallet" will be able to delegate to complete the missing delegation ? 

eg: delegation cap set to "3750" with one running node (1250 in DM + 1250 in delegation) + 1250 from delegators

thank you in advance for your clarifications

 

Kevin 

 

[adisimpson 0]

Hi guys,

I have delegated eGLD on November 30th and the eGLD are still in the waiting list, still no active delegation. Is that normal?

[Sever Moldovean 24]

On 1/23/2021 at 12:42 AM, adisimpson said:

Hi guys,

I have delegated eGLD on November 30th and the eGLD are still in the waiting list, still no active delegation. Is that normal?

Hey adisimpson,

We don't know how long it takes to move from waiting list to active delegation. You can track your place in the queue and the progression by going to wallet.elrond.com into the Delegation section. 

It all depends on how many are withdrawing from active delegation. They are automatically replaced by those on the waiting-list.

The good thing is while on the waiting list you earn rewards. Last week the APR was 6.71%.

[IKosov 0]

Dear Sirs,

I would like to know how much rewards are received from the My Waiting List Delegation, since they are 4000 Egld share  between the Waiting List, and depends on the time you were waiting and others, like explained in this threads, but I would like to see this reward showed differently than my Active delegation rewards, because I cannot understand exactly what were my rewards from Active Delegation and from Waiting List delegation, and if i want to calculate is a bit too much for my brain, maybe someone can answer for me.

Thank you for your service and support.

[Marius Grigoras 19]

11 hours ago, IKosov said:

Dear Sirs,

I would like to know how much rewards are received from the My Waiting List Delegation, since they are 4000 Egld share  between the Waiting List, and depends on the time you were waiting and others, like explained in this threads, but I would like to see this reward showed differently than my Active delegation rewards, because I cannot understand exactly what were my rewards from Active Delegation and from Waiting List delegation, and if i want to calculate is a bit too much for my brain, maybe someone can answer for me.

Thank you for your service and support.

Hi Ikosov,

For the ActiveDelegation the APR is fixed currently at 29% and you need to manually claim the rewards using the ClaimRewards button (right side). This is paid daily.

For the WaitingList Delegation the APR is dynamically and can vary based on the no of eGLD in the queue (which evident can be different from week to week). Last week the APR was ~ 6.7%. This reward is coming by default in your main wallet (from where you made the delegation process), so no need for manually ClaimRewards operation. Also you can see the transaction in the transactions list. This is paid weekly (on every Monday) - you can receive fractional parts of it if you don't have a full week in the List, but is mandatory to still be in the List in the Monday to receive the rewards.
The rewards buffer for both Delegation and Validators Lists is 5000eGLD per week.

Best regards,
Marius

 

[cneazul 0]

On 1/20/2021 at 5:17 PM, Adrian Dobrita said:

1. The queue/waiting list will no longer be incentivized, but at the same time more "seats" will be available for staking and the delegation manager will be available for staking providers.

At this point we might see some migration from active delegation and/or waiting list delegation to active delegation for staking providers. The nodes for the community nodes delegation will not be supplemented, so active delegation will only become available on the community delegation smart contract if someone with active delegation withdraws.

2. The option for staking providers to choose different lockups of 12 months, 24 months is not yet finalized and will not be available in the first phase3 release, so the behavior will be similar with the community delegation, with maybe different fees per staking provider.

When the different lockup period will be activated, then you could still undelegate within the 12/24 months, but there will be some penalty on the rewards. The unbonding time will be the standard 10 days, no matter if you did the undelegate within the lockup period or after. 

 

Hello Adrian,

I am currently on rank 20.000 in the waiting list, advancing at a pace of 150 per day. If in early March we will have Phase 3, that means that I will probably be on rank 15.000 on the waiting list by then. In Phase 3 there will be no rewards for waiting list, so do we have any chance to get on the active delegation list? I know that in Phase 3 the reward pool will be 5000 eGLD instead for 4000, but will the number of active delegators will also increase? And if yes, by what number?

[Adrian Dobrita 19]

15 hours ago, cneazul said:

Hello Adrian,

I am currently on rank 20.000 in the waiting list, advancing at a pace of 150 per day. If in early March we will have Phase 3, that means that I will probably be on rank 15.000 on the waiting list by then. In Phase 3 there will be no rewards for waiting list, so do we have any chance to get on the active delegation list? I know that in Phase 3 the reward pool will be 5000 eGLD instead for 4000, but will the number of active delegators will also increase? And if yes, by what number?

Hi cneazul,

The reward pool for the combined waiting lists (staking/delegation queues) is already 5000 eGLD.

With phase 3 you will be able to delegate your funds to staking services providers or run your own validator, as 1031 validator seats will be opened (from 2169 total number now to 3200 in phase3).

This means that there will be an extra 1031*2500 = 2,577,500 eGLD that can become active delegation or active stake.

Currently there are already 339 out of the 1031 seats filled in the staking queue (you can see that in explorer).

For the validators that fill the 1031 seats, or active delegations for those seats, they will earn rewards as described in the phase 3 proposal.

Phase 3 will also enable top-up, so extra to those 2577500 eGLD there can be an uncapped amount (actually limited by the circulating supply) staked/delegated, but with lower APR. The APR for the active stake/delegation that cover the base stake for those 1031 seats, as well as the APR for the top-up stake will change dynamically based on the total stake in the network, but it will always be guaranteed that the return for the base stake (2500 per validator) will be higher than the return for the top-up (extra stake, above the 2500 per validator).

The queues for delegation and staking (currently also called waiting lists, but we decided to change the naming as to avoid confusion since we also have waiting nodes in the system used to buffer the shuffling between shards of active nodes) will still work but as you mentioned will no longer be incentivized. These will be used for providing easy replacement for undelegated and unstaked amounts.

[KenSilverman 2]

Great job guys, but hardly decentralized if the only people who can validate must have over $250,000 in EGLD.  That is RIDICLULOUS!  I expected to set up several v-nodes myself.  Now I can't, not with a 2500 min. limit moonshot.  A truly decentralized network can have more than 3200 validators (AVAX supports endless number).  It can have millions ... and it is much healthier for a network to have more validators and less delegators.  You need to lower your minimums dudes!   More like 100 or 200 EGLD per node would make a lot more sense.  You can just have the very rich being validators, totally makes for a centralized validation network and weakens the consensus  strength of the system.   You should have maximum stakes like ETH does to guarantee more nodes are set up if people want to make more money.  You are kind of doing that by incentivizing smaller validation stakes.  Still gotta have lower mins team.   100 to 500 EGLD min. is far more decentralized.

Edited February 7 by KenSilverman
spelling errors

[KenSilverman 2]

oh and designing a system that would  necessarily wall-out "wait-listed" delegators to 6% while actives are at 29% instead of gradual lowering of total interest rate for *all particpants equally* in one traunch, fairly distributing rewards as such, (like other chains do for example eth 2.0)  is odd, for such a great architecture.  Elrond is great, but your staking is too centralized.   Please - as main focus, lower your min validator stake to 100 to 500 and (as you plan to do) let validators select the reward they will pass on to delegators - but you gotta lower the barrier to entry to become a validator - gets you more consensus instead of only the very rich controlling the network - the whole spirit of permissionless blockchain is against that control among the concentration of wealth.

[Alt 0]

Yup, feeling the same way. Was going to buy 2500egld a few weeks ago for a validator node when it was around $37. Couldn't do that fast enough and now that shipped sailed. Wanted to play a bigger role, but now all the good roles are filled.

 

 

[Adrian Dobrita 19]

you can still delegate any amount of egld (above 10 egld).

currently delegation has a hardcap which was already reached, so you can only enter active delegation and earn 29% rewards if someone withdraws.

With the update for staking phase 3 (expected sometime at the end of the month, or early next month), you will be able to enter active delegation through staking services and earn higher rewards (same as staking your own node minus the staking service fee), as more seats will be available and we activate also the possibility of staking more than just the minimum node price.

As the number of transactions increase, when we reach a 40% average gas fill rate per block more shards will be created, which will allow more nodes to join the network.

[Alt 0]

At the moment there is 3,364,309 EGLD in the waiting list delegation. So that exceeds the "1031*2500 = 2,577,500 eGLD that can become active delegation or active stake." Not even counting with the validator queue.

So you're either in the 29%APY club or you're in the 0%APY club? (since waiting lists will be disincentivized)

[Adrian Dobrita 19]

2 hours ago, Alt said:

At the moment there is 3,364,309 EGLD in the waiting list delegation. So that exceeds the "1031*2500 = 2,577,500 eGLD that can become active delegation or active stake." Not even counting with the validator queue.

So you're either in the 29%APY club or you're in the 0%APY club? (since waiting lists will be disincentivized)

all the rest can go to top-up stake, which for staking services will cause the return for base stake and topup stake to average.

the delegator does not need to care that his delegation was for base stake or top up stake, he will receive average returns.

the same if you are running your own node, then you can top-up your stake, which averages to some value depending on the ratio of topup and base stake.

the split into top-up stake rewards and base stake rewards was relevant for staking services to enable them to compute returns based on their own number of staked nodes and ratio. This will give higher returns when you have lower ratio (topup/base).

this model will permit everyone to enter through delegation, which will make the rewards change dynamically based on the network staked amount and top-up amount. Delegators can check the current ratio and return for the staking services and choose the one that gives higher returns (also considering the fees).

[Adrian Dobrita 19]

So delegation will work pretty much like @KenSilverman suggested he would have liked it, once we do the phase3 delegation update.

There is no need for more nodes, which would generate more shards, as with 3 shards we have enough processing power to cover ~15k TPS and keep the validators operators happy.

Once the usage increases there will be more shards and more seats for validators opened, which may or may not decrease the price per seat (depending on demand).

[Bogdan Lisman 1]

Hey guys, I have a few questions:

1. Does it do any good if I run squad observers nodes? Can't afford to stake at the moment

2. Also can you change the way the nodes connect to each other? Having ports opened is a higher  security risk from my point of view. I would prefer the node to make outbound connections, rather than behaving like a server and wait for connections. Or at least that's what I understood from the installation documents

3. How long does it take to receive the reward in the delegation waiting list? 🙂

[Alt 0]

1 hour ago, Bogdan Lisman said:

Hey guys, I have a few questions:

1. Does it do any good if I run squad observers nodes? Can't afford to stake at the moment

2. Also can you change the way the nodes connect to each other? Having ports opened is a higher  security risk from my point of view. I would prefer the node to make outbound connections, rather than behaving like a server and wait for connections. Or at least that's what I understood from the installation documents

3. How long does it take to receive the reward in the delegation waiting list? 🙂

I can answer the last one: you receive it every Monday. It goes into your account balance. If you have the Maiar app you'll get a nice push notification with the amount credited. It's very cool.

[Marius Grigoras 19]

1 hour ago, Bogdan Lisman said:

Hey guys, I have a few questions:

1. Does it do any good if I run squad observers nodes? Can't afford to stake at the moment

2. Also can you change the way the nodes connect to each other? Having ports opened is a higher  security risk from my point of view. I would prefer the node to make outbound connections, rather than behaving like a server and wait for connections. Or at least that's what I understood from the installation documents

3. How long does it take to receive the reward in the delegation waiting list? 🙂

Hello Bogdan,

1. A squad observers is only useful if you run a validator node. Imagine that node is crashing for whatever reason. Just moving a BLS key to the specific observer shard (in sync with your node) you can have your node up and running in seconds.
2. A socket is basically the IP + a port. Without ports you cannot have connections to user-space app level. The open ports used by Elrond blockchain are just random ones (nothing popular).
3. Already answered above.

Best regards,

Marius

Edited February 8 by Marius Grigoras