(Watch the full workshop here)
TL;DR
❗Validating with Findora means you are bringing scalable privacy to Ethereum (and its satellite networks) and accelerating mass adoption of DeFi.
❗Validator rewards and penalties are carefully balanced to incentivize the long-term sustainability and security of Findora.
❗Epoch cycles happen every four blocks or so, meaning rewards can start to pay out in as little as a minute.
❗Validators can track their performance using Findorascan.io.
❗Delegators can delegate funds from within the Findora Native Wallet.
Our Commitment to Partner with Developers
Findora is dedicated to bringing privacy to Web3 and working with talented teams across Web3 to make that vision a reality.
Part of that process is providing developers with the tools and documentation they’ll need to build on Findora. To that end, we put on weekly “Findora Fridays” designed to help developers understand how Findora works and how to get started.
Why Validate on Findora?
A big way for developers or retail users to partner with Findora is to become a validator to secure the network.
As with any other Proof of Stake network (PoS), validators are rewarded for securing the network. Findora offers both a block reward and the block proposer reward to validators and those that delegate funds with them.
Beyond the financial incentive, validating with Findora means you are contributing to the future of privacy in DeFi and Web3. Privacy is necessary to accelerate mass adoption because it is required by many institutions before they enter the space.
Though privacy sometimes has a negative connotation, it really serves as a financial primitive. Some use cases for privacy include private payroll, private markets that won’t reveal proprietary trading strategies, DAO signing of community wallets, and DAO voting without discrimination or intimidation. Validators on Findora will be part of that.
Watch the workshop here or read a few highlights below.
Validator Best Practices
It’s recommended that validators use a cloud service like AWS or GCP services to run a node since this way, you don’t need to worry as much about downtime.
AWS and GCP have backup systems that can keep your nodes live. Self-hosting a validator node means that you may suffer from slashing penalties for power outages or hardware failures. When self-hosting a node, you will need to tend your node yourself or face slashing penalties for downtime.
Validators should keep in mind that their voting power is limited to 20% no matter how much they have staked on a node. Findora doesn’t want to incentivize the creation of whales, just “baby whales” with multiple nodes. The more nodes run on a network, the healthier and more secure it ends up being.
Slashing Stake
“Slashing stake” is when a network burns some of the tokens a validator and their delegators have staked as a penalty. It’s a critical mechanism all PoS networks have to incentivize good behavior and network health.
With Findora, there are four reasons why a validator and their delegators might have their stake slashed:
- They are unreliable with long periods of downtimes — this might result from a power outage or just a validator turning their node off. When this happens, a very small amount, around .1% of their stake, is burned for every block missed. There is a new block on Findora every ~15 seconds.
- Serious Attacks — If a validator tries to attack the network with an attack like a double signing attack, they will lose 5% of their total staked amount. A double signing attack is when a validator tries to vote twice on the same block and corrupt the consensus mechanism.
- Light Attacks — Findora will slash 1% of the total amount staked for attacks that aren’t as serious.
- Unknown and Undefined Attacks — Though rarer, these can be serious threats to the network. As a result, 30% of the total amount staked will be slashed.
Findora runs on the Tendermint consensus engine, and the slashing helps protect the network from malicious actors. There are also rewards to incentivize network health. Slashing rates are balanced with reward rates in order to provide a carrot and stick incentive structure to protect networks.
Findora Reward Rates
As stated before, there are two types of rewards paid to validators — a block reward and a block proposer reward. Delegators who stake with a validator share in the block reward and any slashing penalties.
The more delegated to a validator, the more rewards they can earn. The APY reward for staking on Findora with a validator is on a sliding scale:
The reward rate increases as the amount staked FRA that is in circulation decreases to encourage more staking. Rewards decrease as more and more FRA get staked. The Rate Modifier Constant is set at 0.0536 (as of 5/1/2022) and is responsible for determining the reward rate for each value of % circulating supply staked. The community is able to vote on the modifier constant as needed.
To learn more about the rewards paid to validators and delegators, check out the updated Findora Wiki.
Findora Epoch Cycles
Rewards to validators are paid after every epoch cycle which is only every 4 blocks. Since there is a new block every 15 seconds, once you start validating with Findora, you can start getting rewards within a minute.
Validators can check their rank, earnings, or the health of their node by visiting findorascan.io. Currently, the top 74 validators are listed on Findorascan.io but that number should be increased eventually to 100.
What to Consider as a Delegator
Delegators stake FRA by entrusting it to a validator. Having funds delegated to validators helps them earn more rewards and delegators in turn share in those rewards, but it also means you are penalized when they are.
As a result, it’s worth researching a validator before staking with them. You can research all kinds of things about a validator using findorascan.io. Here are perhaps the top three things to consider when doing your research:
- Validator Uptime
- Number of blocks proposed
- What reward rate is being given out by the network? At the time of this recording, the reward rate is around 50% APY.
You’ll also find their commission rate which is what they charge for using their node. Though some offer a 0% commission rate, which is generous, it’s always good to tip your local validator. They need to be rewarded for their work, and some validators even try to offer 0% commission because it’s a way to boost voting power for a malicious attack.
When Can I Get Back the Amount that I stake?
To unstake or unbond FRA requires 21 days. Requiring an unstaking period of a few weeks is not uncommon because the period has to be long enough to prevent long-range attacks in which actions taken don’t affect the network for another 10–15 days.
Having an unstaking period in which delegators and validators could still have their funds slashed prevents both long-range attacks and other types of malicious activity.
How to Start the Validation Process
Before becoming a validator, it’s good to learn the basics about Findora from the wiki and get some FRA to stake. Just below that tab in the menu you will find the change log which you can check for updates.
After that, go ahead and check out the validator start guide on the Findora Wiki. It will walk you through step by step how to do a manual setup or an automatic setup. Although the automatic setup works perfectly well and is easier, doing the manual setup will give you a better understanding of what is happening under the hood.
If you’re running multiple nodes, manual setup will make it easier to manage them. You’ll know where your keys are, how your folders are set up, and give you more control of your directories.
We put on regular workshops for developers to prepare them to develop on Findora. Follow Findora on Twitter to never miss one! If you have a great idea you want to build on Findora, apply for a grant from our $100 Million Ecosystem Fund.
