Validator FAQs

General Concepts

What is a Validator?

A validator is a semi-trusted entity responsible for validating and producing blocks. The Gitopia main chain relies on a set of validators to secure the network. The role of validators is to run a full-node and participate in consensus by broadcasting votes which contain cryptographic signatures signed by their private key. Validators commit new blocks in the blockchain and receive revenue in exchange for their work. By performing those tasks, they earn LORE tokens as a reward. In the case of block provisioning, the reward comes from the tokens newly minted on that block. Validators must also participate in governance by voting on proposals. Validators are weighted according to their total stake.

Validators can stake their LORE tokens (the native token on Gitopia) or be delegated tokens from other LORE holders. Validators will be able to charge delegators a commission in LORE tokens for their work in securing the network. In the case of misbehavior by the validator (for example, signing two different blocks at the same block height), part of the collateral deposited by them will get slashed.

What is Staking?

Staking is the process of locking up a digital asset (LORE in the case of Gitopia) to provide economic security for a public blockchain. Public blockchains are permissionless networks, meaning anyone is free to participate in maintaining them. As a result, it would be possible for some of the network maintainers (called validators) to act maliciously. To ensure that the maintainers behave in the network’s best interest, the locked-up assets are at risk of being partially slashed (destroyed) if there is evidence that a fault was committed.

Due to the practical constraints of the software, the number of validators on Gitopia has to be capped. This restriction does not mean those LORE token holders who do not operate as validators themselves can't participate in securing the network. In fact, LORE tokens are designed to let each holder participate in securing the network using a mechanism called delegation. When LORE holders stake their LORE tokens, they must choose one or more validators to delegate to. The delegators are then eligible for receiving rewards but are also at risk of slashing, if the validators they choose, misbehave.

Who is a Delegator?

Delegators are LORE holders who cannot, or do not want to run validator operations themselves. Delegators help secure the Gitopia main chain by selecting one or more validators and delegating their voting power to them by putting up LORE tokens as collateral. In return, delegators can earn a proportion of the transaction fees as well as block rewards.

Validators never obtain custody of the LORE tokens delegated to them. Thus, there is no risk for delegators of their LORE tokens being stolen by validators.

Because they share revenue with their validators, delegators also share responsibility. Should a validator misbehave, each of its delegators will be partially slashed in proportion to their stake. This is why delegators should perform due diligence on validator candidates before delegating, as well as spreading their stake over multiple validators. Delegators play a critical role in the system, as they are responsible for choosing validators. Being a delegator is not a passive role: Delegators should actively monitor the actions of their validators and participate in governance.

What is Slashing?

Slashing is an event, which results in a loss of stake percentage, depending on the type of network violation and jeopardizing the safety of other participants. Therefore, it represents not only a financial incentive to act properly but also is a measure to prevent nothing at stake problem.

Gitopia is a complex ecosystem where LORE tokens act not only as an economic incentive but also represent a governance unit playing a crucial role in ecosystem security. In that way, slashing becomes a tool that influences voting power distribution.

Besides, it affects the authority of caught fraudulent participants, motivates validators to improve their infrastructure, and in the case of delegators, to provide deeper due diligence and diversification amongst validators. Slashing also acts as a decentralization mechanism motivating re-delegate LORE tokens to more reliable or even smaller validators with equal security and infrastructure set up.

Which faults can lead to Slashing events?

If a validator misbehaves, their delegated stake will be partially slashed. There are currently two faults that can result in slashing of funds for a validator and their delegators:

• Double signing: Double signing can cause a double-spend or chain fork. The wrong setup of the validator’s infrastructure or key compromise are the most common occasions that cause this type of slashing. If someone reports on chain A that a validator signed two blocks at the same height on chain A and chain B, and if chain A and chain B share a common ancestor, then this validator will get slashed by 5% on chain A. The validator also loses the right to propose blocks and earn rewards without the ability to un-jail. All delegators of this validator enter the unbonding period, which lasts 21 days.
• Downtime: Downtime occurs when the validator is offline and does not participate in block commitment signing less than 5% of the blocks in a row of 10000. This situation leads to a loss of 0.01% stake not only for validators but also for bonded delegators. In addition, the validator drops out of the consensus and does not earn block rewards for at least 10 minutes. After fixing the issues, the validator can re-join the validators set by sending an un-jail transaction.

Slashing also affects LORE tokens, which were in the unbonding phase when one of these events happened.

Becoming a Validator

How to become a validator?

Any participant in the network can signal their intent to become a validator by creating a validator and registering its validator profile. To do so, the candidate broadcasts a create-validator transaction, in which they must submit the following information:

• Validator's PubKey: Validator operators can have different accounts for validating and holding liquid funds. The PubKey submitted must be associated with the private key with which the validator intends to sign prevotes and precommits.
• Validator's Address: It is the address used to identify your validator publicly. The private key associated with this address is used to delegate, unbond, claim rewards, and participate in governance.
• Validator's name (moniker)
• Validator's website (Optional)
• Validator's description (Optional)
• Initial commission rate: The commission rate on block provisions, block rewards and fees charged to delegators.
• Maximum commission: The maximum commission rate that this validator will be allowed to charge. This parameter is fixed and cannot be changed after the create-validator transaction is processed.
• Commission change rate: The maximum daily increase of the validator commission. This parameter is fixed and cannot be changed after the create-validator transaction is processed.
• Minimum self-delegation: Minimum amount of LORE the validator needs to have bonded at all times. If the validator's self-delegated stake falls below this limit, their validator gets jailed and kicked out of the active validator set.

gitopiad tx staking create-validator --amount=1000000ulore --pubkey=$(gitopiad tendermint show-validator) --moniker="choose a moniker" --chain-id="chain_id" --commission-rate="0.10" --commission-max-rate="0.20" --commission-max-change-rate="0.01" --min-self-delegation="1000000" --gas="auto" --gas-prices="0.001ulore" --from="key_name"

Once a validator is created and registered, LORE holders can delegate LORE to it, effectively adding stake to its pool. The total stake of a validator is the sum of the LORE self-bonded by the validator's operator and the LORE bonded by external delegators.

From all validator candidates that signaled themselves, the 100 validators with the most total stake are the designated validators. If a validator's total stake falls below the top 100, then that validator loses its validator privileges. The validator cannot participate in consensus or generate rewards until the stake is high enough to be in the top 100. Over time, the maximum number of validators may be increased via on-chain governance proposal.

Validator keys and states

What are the different types of keys?

There are two types of keys:

• Tendermint Key: A unique key that is used to sign consensus votes. It is associated with a public key gitopiavaloperpub
  • Generated when the node is created with gitopiad init.
  • To get this value, run gitopiad tendermint show-validator.
• Application keys: This key is created from the gitopiad binary and is used to sign transactions. Application keys are associated with a public key that is prefixed by gitopiapub and an address that is prefixed by gitopia.

The Tendermint key and the application key are derived from account keys that are generated by the gitopiad keys add command.

What are the different states a validator can be in?

After a validator is created with a create-validator transaction, the validator is in one of three states:

• in validator set: Validator is in the active set and participates in consensus. The validator is earning rewards and can be slashed for misbehavior.
• jailed: Validator misbehaved and is in jail, i.e. outside of the validator set.
  • If the jailing is due to being offline for too long (i.e. having missed more than 50% out of the last 100 blocks), the validator can send an unjail transaction in order to re-enter the validator set.
  • If the jailing is due to double signing, the validator cannot unjail.
• unbonded: Validator is not in the active set, and therefore not signing blocks. The validator cannot be slashed and does not earn any reward. It is still possible to delegate LORE to an unbonded validator. Undelegating from an unbonded validator is immediate, meaning that the tokens are not subject to the unbonding period.

Delegators have the same state as their validator.

What is self-delegation? How can I increase my self-delegation?

Self-delegation is a delegation of LORE from a validator to themselves. You can increase your self-bond by delegating more LORE to your validator account.

Is there a minimum amount of LORE that must be staked to be an active (bonded) validator?

The minimum is 1 LORE. But the network is currently secured by much higher values. The top 100 validators with the highest total stake (where total stake = self-bonded stake + delegators stake) are the active validators. You can check the minimum required LORE to become part of the active validator set on the Gitopia Block Explorer.

How do delegators choose their validators?

Delegators are free to choose validators according to their own subjective criteria. That said, criteria anticipated to be important include:

• Amount of self-delegated LORE: Number of LORE a validator self-delegated to themselves. A validator with a higher amount of self-delegated LORE indicates that the validator is sharing the risk and experienced consequences for their actions.
• Amount of delegated LORE: Total number of LORE delegated to a validator. A high voting power shows that the community trusts this validator. Larger validators also decrease the decentralization of the network, so delegators are suggested to consider delegating to smaller validators.
• Commission rate: Commission applied on revenue by validators before the revenue is distributed to their delegators.
• Track record: Delegators review the track record of the validators they plan to delegate to. This track record includes past votes on proposals and historical average uptime.
• Community contributions: Another (more subjective) criteria is the work that validators have contributed to the community, such as educational content, participation in the community channels, contributions to open source software, etc.

Apart from these criteria, validators send a create-validator transaction to signal a website address to complete their resume. Validators must build a reputation one way or another to attract delegators. For example, a good practice for validators is to have a third party audit their setup. Note though, that the Gitopia team does not approve or conduct any audits themselves.

Responsibilities

Do validators need to be publicly identified?

No, they do not. Each delegator can value validators based on their own criteria. Validators will be able(and are advised) to register a website address when they nominate themselves so that they can advertise their operation as they see fit. Some delegators prefer a website that clearly displays the team operating the validator and their resume, while other validators might prefer to be anonymous validators with positive track records. Most likely both identified and anonymous validators will coexist in the validator set.

What are the responsibilities of a validator?

Validators have two main responsibilities:

• Be able to constantly run a correct version of the software: Validators need to make sure that their servers are always online and their private keys are not compromised.
• Actively participate in governance: Validators are required to vote on every proposal.

Additionally, validators are expected to be active members of the community. Validators must always be up-to-date with the current state of the ecosystem so that they can easily adapt to any change.

What does 'participate in governance' entail?

Validators and delegators on Gitopia can vote on proposals to decide on key issues involving the blockchain and its development. Validators play a special role in the governance system. As pillars of the system, validators are required to vote on every proposal. It is especially important since delegators who do not vote inherit the vote of their validator.

What does staking imply?

Staking LORE can be thought of as a safety deposit on validation activities. When a validator or a delegator wants to retrieve part or all of their deposit, they send an unbonding transaction. Then, LORE undergoes a 3-week unbonding period during which they are liable to being slashed for potential misbehaviors committed by the validator before the unbonding process started.

Validators, and by association delegators, receive block rewards, fees, and have the right to participate in governance. If a validator misbehaves, a certain portion of their total stake is slashed. This means that every delegator that bonded ATOM to this validator gets penalized in proportion to their bonded stake. Delegators are therefore incentivized to delegate to validators that they anticipate will function safely.

Can a validator run away with their delegators' LORE?

By delegating to a validator, a user delegates voting power. The more voting power a validator has, the more weight they have in the consensus and governance processes. This does not mean that the validator has custody of their delegators' LORE. A validator cannot run away with its delegator's funds.
Even though delegated funds cannot be stolen by their validators, delegators' tokens can still be slashed by a small percentage if their validator suffers a slashing event, which is why we encourage due diligence when selecting a validator.

How often is a validator chosen to propose the next block? Does frequency go up with the quantity of LORE staked?

The validator that is selected to propose the next block is called the proposer. Each proposer is selected deterministically. The frequency of being chosen is equal to the relative total stake (where total stake = self-bonded stake + delegators stake) of the validator. For example, if the total bonded stake across all validators is 100 LORE and a validator's total stake is 10 LORE, then this validator will be chosen 10% of the time as the proposer.

How can a validator safely quit validating on Gitopia

If a validator simply shuts down their node, this would result in the validator and their delegators getting slashed for being offline. The only way to safely exit a validator node running on Gitopia is by unbonding the validator's self-delegated stake so that it falls below its minimum self-delegation limit. As a result, the validator gets jailed and kicked out of the active set of validators, without getting slashed. They can then proceed to shut down their node without risking their tokens.
It's highly advised to inform your delegators when doing this, as they will still be bonded to your validator after it gets jailed. They will need to manually unbond and they might not have been made aware of this.

Incentives

What is the incentive to stake?

Each member of a validator's staking pool earns different types of revenue:

• Block rewards: LORE tokens are inflated to produce block provisions. These provisions exist to incentivize LORE holders to bond their stake. Non-bonded LORE gets diluted over time.
• Transaction fees

This total revenue is divided among validators' staking pools according to each validator's weight. Then, within each validator's staking pool the revenue is divided among delegators in proportion to each delegator's stake. A commission on delegators' revenue is applied by the validator before it is distributed.

What is a validator commission?

Revenue received by a validator's pool is split between the validator and their delegators. The validator can apply a commission on the part of the revenue that goes to their delegators. This commission is set as a percentage. Each validator is free to set their initial commission, maximum daily commission change rate, and maximum commission. Gitopia enforces the parameter that each validator sets. The maximum commission rate is fixed and cannot be changed. However, the commission rate itself can be changed after the validator is created as long as it does not exceed the maximum commission.

What is the incentive to run a validator?

Validators earn proportionally more revenue than their delegators because of the commission they take on the staking rewards from their delegators.
Validators also play a major role in governance. If a delegator does not vote, they inherit the vote from their validator. This voting inheritance gives validators a major responsibility in the ecosystem.

How are block rewards distributed?

Block rewards are distributed proportionally to all validators relative to their voting power. This means that even though each validator gains LORE with each reward, all validators maintain equal weight over time.

How to prevent concentration of stake in the hands of a few top validators?

The community is expected to behave in a smart and self-preserving way. When a mining pool in Bitcoin gets too much mining power the community usually stops contributing to that pool. Gitopia relies on the same effect. Additionally, when delegators switch to another validator, they are not subject to the unbonding period, which removes any barrier to quickly redelegating tokens in service of improving decentralization.

Technical Requirements

What are hardware requirements?

We expect that a modest level of hardware specifications will be needed initially and that they might rise as network use increases.
The minimum recommended hardware requirements for running the Gitopia validator are:

• 4 CPU Cores
• 32GB RAM
• 1TB of storage

What are software requirements?

In addition to running a Gitopia node, validators should develop monitoring, alerting and management solutions.

What are bandwidth requirements?

Gitopia has the capacity for very high throughput relative to chains like Ethereum or Bitcoin.
We recommend that the data center nodes connect only to trusted full nodes in the cloud or other validators that know each other socially. This connection strategy relieves the data center node from the burden of mitigating denial-of-service attacks.
Ultimately, as the network becomes more used, one can realistically expect daily bandwidth on the order of several gigabytes.

What can validators expect in terms of operations?

Running an effective operation is key to avoiding unexpected unbonding or slashing. Operations must be able to respond to attacks and outages, as well as maintain security and isolation in the data center.

What are the maintenance requirements?

Validators should expect to perform regular software updates to accommodate upgrades and bug fixes. There will inevitably be issues with the network early in its bootstrapping phase that will require substantial vigilance.