Elrond Staking Phase 3 Upgrade: Details And Timelines

Lucian Mincu
·
Mar 18, 2021
·
6 min read
https://explorer.elrond.com

After endless hours of development and relentless testing from our amazing Validators community, our rapid iteration cycle has resulted in the elrond-go release v1.1.37.0. We are extremely excited that it has already gone live, and more than 2000 Validator nodes from all over the world have already deployed it!

The most important changes have been covered in our previous blog post: https://elrond.com/blog/elrond-staking-phase3-coming-soon/

Today we introduce the most important next steps and relevant timelines:

March 26 ~14:30 UTC - Delegation Manager goes live

The activation of the Delegation Manager enables anyone to create their own Staking Pool and operate nodes on behalf of customers, who can delegate their eGold in a non-custodial manner. Starting with March 26 ~14:30 UTC, Staking Providers will be able to deploy their instances of delegation smart contracts.

We are updating the go-live date for the Delegation Manager to March 26, in order to ensure enough time for all exchange and wallet partners. This will enable them to perform swift updates for their Elrond infrastructure and avoid any service disruptions to their customers.

March 26 16:30 UTC - Upgrades to the Elrond Web Wallet & Maiar

The Elrond Web Wallet will be upgraded to allow web hooks from Delegation Manager Dashboards to interact with it, enabling users to interact with staking providers and delegate eGold towards them, in a fully non-custodial and secure manner, from the Elrond Web Wallet.

Maiar will be upgraded to accommodate staking as well, opening the door for more than 300,000 users to stake their eGold using the most intuitive blockchain app and joining the rest of the eGold holders in securing the Elrond Network.

April 5 - Max Validator number increases to 3200

The final and most important step in the Staking Phase 3 activation process will be the increase of the maximum number of Validator nodes. This will allow nodes from the Validator Queue and the newly deployed staking pools to become active Validators and start earning rewards.

Starting on this date, people who delegate in the Delegation Waiting List will continue to earn 6% APY rewards on a weekly basis for 4 more weeks.

On April 5 ~14:30 UTC at epoch 249 the nodes from the Validators Queue and newly deployed staking pool will become Validators and be placed on the waiting list. This will happen in the order they have been added in the Validators Queue and staking pools, which is in effect a single queue, serving new nodes on a first-come, first-serve basis.

On April 6 ~14:30 UTC at epoch 250, 320 new nodes (80 for each shard) become Active Validators.

April 7 - the first rewards from the new Validators

On April 7 ~14:30 UTC at epoch 251, these nodes distribute their rewards towards their stake owners, whether directly staked or delegated, in effect producing the first rewards for Staking Phase 3. Also at this date and time, the next 320 new nodes become Active Validators, and so on.

May 3 - Stop rewards for Delegation Waiting List

After 4 weeks grace period, the Delegation Waiting List will stop yielding rewards to its participants. Delegators will henceforth require to unstake their eGold and find a suitable Staking Provider to delegate their eGold and earn rewards.

What is the new APR?

Staking Phase 3 increases the number of Validators to 3200 and opens the possibility to stake more than 2500 EGLD per validator node.

The rewards at the network level are fixed and remain unchanged. Learn more about them here: https://elrond.com/blog/the-wealth-of-crypto-networks-elrond-economics-paper/

They are equally distributed to all Validators, proportional to their stake. This means that the increase in validator nodes and amounts staked will result in the same network rewards to be distributed towards more eGold holders, and thus lowering the APR.

As a general rule, the base stake will earn more APR than the “top-up” stake added on top of it. The resulting APR will unique per staking pool and distributed proportionally to the delegated amount, minus the service fee.

The Service Fee is applied as a percentage to the earned rewards.

You can find some simulations for the APR in different scenarios in this post: https://forum.elrond.com/topic/667-it%E2%80%99s-time-to-grow-phase-3-staking-proposal/

Remember to factor in the service fee. Most staking providers will offer a calculator on their websites.

Closing Thoughts & FAQ

The efforts to bring this mainnet upgrade live have been tremendous. On behalf of the entire Elrond ecosystem, we commend and congratulate the Elrond developers and Validators community for making this possible.

This critical next step for the Elrond mainnet will incentivize participation in the Proof of Stake economy, locking more value into the network and thus increasing the degrees of decentralization and security.

This is an important prerequisite for the launch of the DeFi 2.0 modules, which will follow in the next weeks and unleash the full potential of the Elrond Network, to enable anyone, anywhere to participate in the new global economy at an internet-scale.

FAQ:

I am an Active Delegator. What do I do next?

“Active Delegation” means, in effect, delegating your eGold towards the Elrond Foundational nodes. The fee for active delegation is 19.45% and will remain unchanged. Staking Providers offer the same non-custodial delegation services at more competitive rates.

We recommend you to research the official Staking Providers, select one or more that suit your needs the best, and delegate towards them.

You will need to unstake your eGold, wait for 10 days unbonding period, claim your eGold, and then delegate it.

I am delegating to the Waiting List. What do I do next?

You now have the option to delegate towards a Staking Provider and earn more rewards. You will continue earning rewards until May 3, after which no more rewards will be issued to the Waiting List.

If you take no action, it is possible that you advance to “Active Delegation”, in effect meaning delegating towards the Elrond Foundational nodes. Reminder: the fee for doing so is 19.45%

Why should I trust a Staking Provider over Elrond?

The official Elrond partners have been vetted by the Elrond team and Validator community. They have been contributing value to the ecosystem, through services, tools, and guides. We trust them to have the best interests of the Elrond ecosystem at heart and to be knowledgeable about operating Validator nodes at maximum efficiency.

That being said, delegation towards them is non-custodial. This means they do not have any control or influence over the funds you delegate towards them. They just operate the hardware and software infrastructure on your behalf and charge you a service fee for doing so.

The service fee is a portion of the rewards, which is expressed as a percentage. For example, Elrond Foundational nodes charge 19.45% fees. This is where the difference between 36% APR for Validators and 29% APR for Active Delegators is coming from.

How do I select a Staking Provider?

Here’s what you should be looking for:

  • Reliability: they need to know what they’re doing. Favor providers with proven experience validating on the Elrond Network, at least on the testnet
  • Communication: you’ll need to get information and support from them, on a regular basis. Be sure you pick a team that speaks a language you are comfortable with and matches your availability
  • Economics: go for a competitive fee. While in theory “the lower, the better”, avoid 0% fees - validating on the Elrond Network is not easy, nor cheap

You can find the official Elrond Staking Providers in the “Staking Infrastructure” section of the community-run website Elrond Partners: https://elrondpartners.com/

How do I become an official Elrond Staking Provider?

Anyone can be a staking provider. We have made efforts to simplify the process for anyone who wants to operate Elrond infrastructure and secure our mainnet, either with their own funds or with funds from third parties.

As we are still in the critical process of bootstrapping the Elrond Network, we take extra steps to ensure that we endorse staking providers that share our ethos and have the best interest of the Elrond ecosystem and its users in mind.

There are currently 17 providers that we have vetted and we’re constantly adding more to our list. You can apply to become an official Elrond Staking Provider by filling out this form: https://elrondnetwork.typeform.com/to/z2lX1FgI

How do I run a Validator node?

Running a Validator node requires 2500 eGold for a standalone node or 1250 eGold to start a staking pool, experience with operating Linux infrastructure and servers that fit our requirements.

You can find out all the details in our official documentation: https://docs.elrond.com/validators/overview/

When can I stake in Maiar?

Maiar staking will be enabled on March 26 ~16:30 UTC. You will be able to stake towards the curated list of Staking Providers and start earning rewards, as per their service fees.

You will be able to start earning rewards after April 7, as mentioned above. This means you have sufficient time to review the staking providers and select the ones that suit your interests the best.


For more information, please visit us:


#technical

Written by
Lucian Mincu
CIO, Elrond Network