Proposal: Foundation Tokens Delegation Framework

[gosuri]

In an effort to create a delegation framework that is more flexible, but resolute, it is in the project’s interest to draft a “constitution” for determining the delegations of the project’s treasury. It is worthwhile to note that our delegations outside of our commercial and strategic obligations to date have been driven solely by impartial equity. This is an invitation for feedback and by no means a final draft.

Going forward, delegations from us will be earned, not given. All of our validators should strive to create healthy and consistent contributions that are accretive to the network.

As such, we will govern for equality of opportunity among validators driven by the following guiding principles:

• 10% or lower commission rate, or lower if your validator is in the top 10 ; all else being equal, lower commission rates are preferred
• Validators must proactively contribute to the community. For example:
  • Vitwit: strategic technical partners, Discord moderator, maintains testnet leaderboard, assists community and maintaining aneka
  • Forbole: Maintaining BigDipper.
  • Cosmostation: Maintaining Web and Mobile Wallet and Mintscan.
  • Develop and maintain technical literature such as guides.
• Validators must be an active promoter of the community and project
• Validators must maintain operational excellence, be commercially responsible, and maintain a technically sound and secure infrastructure.
• Validators should maintain a trustworthy public presence with a website and/or on social that clearly indicate they’re validating Akash, with clear contact information for delegators for support
• Bonus: hosting non-critical infrastructure, such as your validator’s website, and/or sentry nodes on Akash and sharing that with the community

[Gaia]

Hey Greg

Makes sense that delegations are earned. A couple of points below:

@gosuri

10% or lower commission rate, or lower if your validator is in the top 10

I’d imagine you want to incentivize top 10 validators to raise their commission rate, so that some delegators would switch away from them and increase decentralization.

@gosuri

all else being equal, lower commission rates are preferred

While it makes obvious sense to set up a ceiling for those who wish to receive delegations from the Foundation, preferring lower commission rates furthers the race to the bottom, already naturally in place due to competition. It seems to me that competent validators (let’s leave out the shoddy/amateur kind) come in two types:

Teams with 3+ people, who have enough bandwidth to hold AMAs, to write extensive blog posts, to participate in every event, to contribute with tooling and market themselves heavily. Some have even already started to look for other revenue streams (see race to the bottom above). These validators can charge 8% and above on almost any chain.

Smaller shops, 2 people or a single team member, who are competent, run proper robust/secure infrastructure, stay on top of alerts around the clock, participate in governance, participate in community developments, but do not have a big name, nor connections to whale investors. These shops usually charge from 0% to 8%.

By adding more pressure to lower fees, you are effectively pushing these smaller shops out of business (or remain unprofitable) sooner rather than later.

These two points aside, I’d add that putting more emphasis on uptime, consistency of presence in the community and seniority should also be considerable factors in the Foundation’s decision. I’d even go as far as suggesting that the Foundation should never delegate enough to any validator to push them in the top 10 (or top 33% of staked amount). The validators that reached the top have already enough market incentives to remain active contributors, to the best they can, and the foundation need not delegate to them (or reduce its delegation).

IMHO the drivers of these changes should be twofold: decentralization and securing the chain (by supporting competent, responsive validators). Level of participation and marketing are surely desirables, but be careful, it could end up helping the big get bigger.

[gamah]

Hello, I’m a small validator and I totally agree with the fact that the delegation should be earned.

In my case I don’t have an official website yet, so in the meantime I have a small blog page hosting links to the different projects that I validate for. I’m doing my best to keep my validator up and running, so far no issues and I have a very good uptime.
Also since I’m french I would love to translate some of your articles but I don’t know where to start.

I don’t have the technical expertise to make a wallet or a block explorer and I think I’m not the only one.

I’m only hoping that this constitution will take in account small validators/one person team.

[chenghiskhan]

Hi Gaia,

Thank you for being the first to participate in this topic.

@Gaia

I’d imagine you want to incentivize top 10 validators to raise their commission rate, so that some delegators would switch away from them and increase decentralization.

Though I understand the logic of this proposal, how would you go about implementing or structuring this type of incentive? Arguably, validators with the biggest delegations from AKT stakers outside of the foundation would prefer these validators because of lower commissions with all else being equal?

@Gaia

By adding more pressure to lower fees, you are effectively pushing these smaller shops out of business (or remain unprofitable) sooner rather than later.

Point well taken. It certainly is not our intention to promote the running of a validator at a loss. Our intent here is to set that ceiling of 10% while also maintaining that the foundation will probably lean towards validators that have lower commission rates with all else being equal.

@Gaia

These two points aside, I’d add that putting more emphasis on uptime, consistency of presence in the community and seniority should also be considerable factors in the Foundation’s decision. I’d even go as far as suggesting that the Foundation should never delegate enough to any validator to push them in the top 10 (or top 33% of staked amount). The validators that reached the top have already enough market incentives to remain active contributors, to the best they can, and the foundation need not delegate to them (or reduce its delegation).

Again, well stated and well received! I agree with the premise of your points here. We also have to take into account the project’s contractual delegation obligations and recognize exceptional validators and partners that create or facilitate extraordinary contributions; we’ll have to adjudicate those according to the foundation’s and Akash Network’s best interests on a case-by-case basis.

[chenghiskhan]

Hi Gamah,

Thank you so much for contributing. Can you link us to your blog and socials?
I also want to make sure that you’re in our discord?

In terms of supporting the project, helping us engage with the French Akashians would be wonderful. Does Akash have a bit of a following among Europeans and in France specifically?

[Edouard]

Thanks @gosuri for kickstarting the discussion and setting up this draft framework.

I believe this is a great step towards an active decentralized community of validators.

Foundation support is critical to the development of smaller validators, and having a clear framework will provide greater transparency on how to attract such delegations.

I agree with @Gaia that incentives should be somewhat distributed in such a manner that it does not consolidate too much power among a few validators.

An example of how this could be done is with a Tier system, as did Tendermint a few months ago.

[gamah]

Hi, here is my blog and my twitter: Notion – The all-in-one workspace for your notes, tasks, wikis, and databases. and https://twitter.com/JetlifeStaking.

You can find me on discord under the username gamah#1214.

@chenghiskhan

Does Akash have a bit of a following among Europeans and in France specifically?

I know that there is already some french people invested in this project but I would like to reach the french people that aren’t aware of this project. If we could have a wiki for Akash in multiple languages that would be wonderful (I’ve translated multiple articles for the Mina protocol wiki and the wiki has been very useful for newcomers).

[chenghiskhan]

@gamah

I know that there is already some french people invested in this project but I would like to reach the french people that aren’t aware of this project. If we could have a wiki for Akash in multiple languages that would be wonderful (I’ve translated multiple articles for the Mina protocol wiki and the wiki has been very useful for newcomers).

That doesn’t sound like a bad idea at all! I think a starting an Akash wiki is something wonderful that the community could contribute and be recognized by the foundation and project!

[Gaia]

@chenghiskhan

Though I understand the logic of this proposal, how would you go about implementing or structuring this type of incentive? Arguably, validators with the biggest delegations from AKT stakers outside of the foundation would prefer these validators because of lower commissions with all else being equal?

This wouldn’t be a panacea, given that the environment is fluid. Make it a point to re adjust these delegations every 6 months? Listen, by no means this is a perfect mechanism. It is a best effort to achieve decentralization while keeping a healthy ecosystem of validators of different sizes (as long as they are competent, present and responsible)

@chenghiskhan

Again, well stated and well received! I agree with the premise of your points here. We also have to take into account the project’s contractual delegation obligations and recognize exceptional validators and partners that create or facilitate extraordinary contributions; we’ll have to adjudicate those according to the foundation’s and Akash Network’s best interests on a case-by-case basis.

Valid and understood! Still, market incentives are in place. The ultimate goal of the Foundation should be to reward contributors while promoting decentralization. Rewarding big contributions need not come in the form of delegations, pushing these top 10 (or again top 33% of TVS) to become even stronger. Create a grant program (forgive me if you already have one?) and reward via the program.

[martin]

Hi Greg,

Very happy for the beginner and first timer like me having a chance to contribute with Akash Network.

In fact, this is my first in Crypto, Blockchain, and even Validator.

I am running a small site https://bwl.network to put all my favorite created article and support for Akash Network.

And the only barrier for me to contribute more, would Akash Team like to provide more technical training, so I can made a best support like Forbole, Vitwit, Cosmostation, and other Pros doing for the community.

I am very happy with Akash and would like to permanently be with Akash Community.

Thank You

As my first contribution as a gamer also,
I am now and will permanently one of the booster the Akash Discord Server chat

Kind Regards,
Martin Phineas (bwLnet)

[OurLink]

Great post @gosuri and very timely too.

@OurLink has been in the crypto community for awhile (circa 2014), supplying mining pools and mining equipment for other crypto projects. However, this is our first foray into the Validator field so your guidelines and expectations goes a long way for us.

[bitcat]

It’s great to see guiding principles being used to advance the Akash Network, and we’ll be more involved.

[Tigdar]

Hey @gosuri & @Edouard , We like this idea of Tiered-delegation-system based on voting power.

And thank you for kick-starting this discussion. Hoping to see a lot more of suggestions and ideas. and yes, there is no perfect solution, together we can! (Tigdar) and will evolve from all learnings.

We have been monitoring our validator and have had a consistent 100% signing rate.

[Cyberili]

Hi everyone,

First of all, I am really happy to see this initiative unfolding as the project matures. Akash is one of the projects that has an impeccable use case and immense potential, and it is also our duty as validators to support the project growth through different mediums.

There is actually one thing that I find really important that should be taken into consideration when delegating, besides increasing the awareness of the project on social media, writing quality Medium articles, helping the community, etc. and that is the participation in Testnets. I noticed this across multiple projects, but sometimes there is not enough attention put on this. From my point of view it is our duty as Validators to not only make sure that we have a smooth mainnet, but to also continue to contribute to the quality of the network’s performance and security through the testnet participation. Plus, as testnets come with some extra costs, these could be covered by the Foundation’s delegation.

I hope my point makes sense and would love to see this being implemented. Looking forward to the next hypergrowth months for Akash!

[armyids]

Hi @gosuri, @chenghiskhan, and everyone.

We validators may already know each other since Mainnet in September last year or maybe even before but I would really appreciate it if you would like to visit our Website or you can reach us on Twitter and Telegram.

I’m so happy to get this merchandise from Akash! Awesome T-Shirt!

I’m very excited to see the validators discussing the delegation framework with the expected conclusion that at the end of discussion we will get the best framework so that the validators will be more competitive as the akash network matures.

In my humble opinion, the Foundation maybe should considering the validators who actively re-delegate their rewards and commissions. I see validators such as SG-1, Simply Staking, Anonstake, and even Bitoven re-delegates every 4 hours because this kind of action is a form of their long-term support for Akash Network.

I hope this suggestion can be approved by the majority of validators.

Thank You.

[IonutS]

Hey Greg

I agree with the fact that delegations have to be earned. Having said this I would have a couple of things to add:

• delegation to validators that are “big and known” - while this is a common practice in many networks, it was proved multiple times that many independent validators or smaller teams actually perform better and are more dedicated than the first category. Foundations usually make the big mistake of centralizing stake among those. Everyone should receive the same amount at moment 0 of a network. Only a clear, provable extra contribution should be a motivation for more delegations.

• foundation should delegate more tokens to validators that are participating on Testnet for certain critical upgrades like Akash Mainnet 2. In my opinion all validators that participated on the current Testnet should be rewarded through delegations.

[Kasper_Newroad]

Hi Greg,

We also agree delegations must be earned. Many good points are already made.

• I think Ionut also points out a good point about testing. The number of validators that participated in the testnet upgrade was low. But this is one of the most important responsibilities of a validator in my opinion.

• Also being transparent as foundation of the amount of votes a validator gets (and why) might be wise so validators can get an insight what to improve. For example: We tested al lot on the multiple testnets (and testnet upgrade) and where in the top of earned tokens which we really apricated, but we did not (or very few) receive any votes from the foundations. We would find it helpful to see where we can improve.

• This is hard to check but running prober hardware and configuration and not a few dollar vps is an especially important item. On other networks (like Matic and Celo) we had such checks in form of interview/audit.