Reward for Validators from Relays on the Network


#1

Each validation of a relay requires the same work done Therefore, the reward should be the same for work done on day 20 of the network and work done on day 23,475.

Some points to consider

• This will ensure the reward doesn’t become too small to be worth joining.
• Nodes will be incentivized to join at any point in the growth of the network.
• To ensure the market is not flooded with POKT tokens there will be burning mechanisms put in place.

Perhaps, including a way for the nodes’ stake to be more elastic will contribute to non-flooding of the market.


#2

I agree with this, the markets will balance out the worth of the work done by driving the price up and down depending on the need in that moment. Protocol wise this helps the network by simplifying the reward mechanics by making:

Work Done = POKT Minted


#3

If “reward” refers to quantity of POKT per relay, I agree. But claim that considerations 1 and 2 above do not follow from this fact.

If “reward” refers to Value of POKT per relay, I also agree. But claim that that goal cannot be achieved without some form of pricing oracle.


#4

It would be helpful if you can elaborate on your position in favor of a consistent reward for the life of the network.


#5

It would help me if you would tell me which definition of “reward” we are discussing so that I don’t have to elaborate everything for both definitions.


#6

I did not realize it wasn’t clear.

I am specifically referring to the reward in mint (POKT tokens) per relay for work done by the actors in the session. Example: 1 POKT per relay on day 20 and 1 POKT per relay on day 23,475.

If you are able to take the time to elaborate for both definitions, you could raise a separate issue that hasn’t been thought of.


#7

Can you expand on what you mean by elastic?

I don’t agree with this. When there is a lower amount of relays happening on day 20 versus day 23,475, the amount of value provided for each node is higher by being early to the network.

  • The risk early nodes take is higher via purchasing POKT and cost of infrastructure
  • Early belief and evangelism in the project
  • Dealing with the problems that come with early software, upgrades, breaking changes, etc

As a result of these factors early adopters should benefit more by an increased amount of POKT earned per relay as opposed to later adopters IMO. I do not believe it should be weighted in a way where early adopters have the majority amount of POKT compared to later contributors significantly later in the life of the protocol, but there should be some extra reward for being an early believer.


#8

The value nodes get from being on the network early is by earning an overall higher amount of POKT.

If 500 relays are happening on day 20 and 10 Nodes are validating the relays, then the reward for each node is 50 POKT.
If 10,000 relays are happening on day 500 and 200 Nodes are validating the relays, then the reward for each node is 50 POKT.

If node A joins day 20, she will have earned a total of 24,000 POKT.
If node B joins day 420, she will have earned a total of 4,000

Why is the risk higher?
It is not possible to know the price of POKT day 20 or 10,000.
If a person runs a node already then is there an additional cost to run a Pocket node and if so would that cost be different day 20 vs. 10,000?

Meaning that the stake for a node on day 20 = 750 POKT, day 500 = 1250 POKT, day 1200 = 1000 POKT. Stake being elastic could be dependent on some factor. Just a thought to aid in removing some POKT from circulation. Probably best for a new post :smile:


#9

Thanks.

I’ve created a separate post to hopefully settle the dollar/relay vs POKT/relay question.


#10

I’m unsure why there was a separate post created. Part of the argument is here and now also in another post. For someone gaining an understanding of views and positions wouldn’t it be best to keep all discussions about a specific topic in one post, the original post?


#11

Volatile cryptocurrencies are a reward that may not correspond to the true utility provided by some action in a blockchain protocol, in this case, relaying, “and players may be driven by external incentives”.

See also:

Are we sure that each validation will require the same work done?

While another topic in itself, how the pool of tokens are funded and the stability/volatility of the price of the coin is important for impacting other decisions on how they are used and distributed. I suggest avoiding an ICO, and also an airdrop, and explore using a liberal radicalism model, using a decentralised stablecoin (like DAI or HAVVEN, not like Tether which isn’t transparent) for raising funds. Pocket Network doesn’t necessarily need to implement its own decentralised stablecoin and can use one of the aforementioned ones.

Link to Ben’s post for future historical reference:

Also related:


Protocol meeting 26/9/2018
#12

You can edit the top of yours and link to the post @BenVan made.


#13

I don’t think you can assume an even distribution here. The distribution of nodes will likely mirror how hashing power increases - large spikes followed by some amount of stable time. Those nodes who are there before each spike should be earning more than those before, especially with increased competition.

I don’t mean token price risk, I mean risk in cost, time and effort expended for contributing to a protocol. Includes learning everything about pocket to spin up physical servers and cost and time of doing so. The ones at the beginning are setting the standard for those who come behind them, making it easier as knowledge spreads. They deserve to earn a premium for this compared to those who come after.


#14

@o_rourke
Per our conversation last night, I believe we agree that the reward for the validators should be the same for the life of the network. We spoke about it enabling the network to be more decentralized.


#15

@o_rourke @Tracie It might be wise to post details of this conversation in order to chronologically archive the decision making.


#16

Topic is closed, we have agreed to give the same reward for the life of the network.