Proposal #3 Increase Validators Seats

Hello Regeners,

It’s now a few months that the network is living with 50 validators, securing it, and validating it.
All of them are validators from the testnet.

The first point that did take my attention to make this proposal is that some of them, are actually not active, with delegation allowed from the team.
I personally found this as a mistake (and I’m not concerned).

There are actually 12 validators with a lot of REGEN tokens delegated to, and 18 more validators waiting for an open seat.

To not create a huge change in the available place, let’s start with this proposal:

  • Allow the 12 validators that should be active to have a seat
    This, increase to 62 active validators in the network.

Let’s not forget active ones that could join and didn’t make it in time to join. As there is 18 validators already ready to be active, let’s add this to the proposal:

  • Allow 8 more seats (what about 13?)
    This, increase to 70 active validators in the network (or 75 if more allowed, didn’t want to push hard for a first proposal).

Regen Network is a huge blockchain and a lot of validators are interested to join the movement.
The more there is, the more visibility will gain the project.
Let’s not make too much of a first step, but let’s let a chance to people invested to have a place and help to scale Regen.

Hope to have quick returns from validators and the community on this to make live the proposal.

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I’m all up for allowing more validators. As I was reading through the post the number 65 came to mind, not sure why.
Anyway, I’m good with either 62 or 70 (or 65 :blush:)

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I’d love to hear opinions from validators who are near the bottom of the current set. The bigger the set, the less each validator gets on average. Do we want validators at the bottom of the set to be able to run profitable businesses, and is that currently possible? Would this shift have much of an impact on them (I just found seven of the last ten validators on Twitter, so I’ll tag them there and ask that they chime in).

I’m not against increasing the validator set—I’d just love to hear from current validators how the economics is working out for them (I know the token just floated, so hard to tell what mid- to long-term outlook might be).

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Hi all - this is Dave from LOACOM validator. Generally positive toward this proposal although I would love hearing the longer term plan for total # of validators that were originally envisioned. Ultimately, I’m still more inclined to support ‘active’ validators who are participating in the community and helping grow the movement in addition to standard validation services.

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I(0base.vc) agree with this proposal. I believe that the ecosystem can become healthier by increasing the number of network participants. And as a low-level validator with no significant delegation, profitability is not significantly affected.

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As a validator of other Cosmos SDK chains who has been participating in the Regen community discussions/Telegram and intends to retire carbon credits in order to offset our carbon footprint, we are definitely interested in validating on Regen Network.

We don’t have any validator running currently on Regen but would plan to set one up if the conditions were right.

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Hi, I’m Pacobits from stakely.io team. We think that validators who participated in testned and support it with the required quality and effort should be part of the active validators set.
The first proposal for 12 validators is good, and not a big increase too much. We’ll be incoming less, but the project will be more secure because of more decentralization.
Furthermore adding new actors to the validators regen ecosystem, it’ll have more attraction for end-users.

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Increasing the validator set should be an evolutionary process and driven by the network expansions. 12 or 15 is good for the next step. There should be always a place for validators who will contribute back to the network or have more stake than just tokens. And we should definitely find a way to help those types of validators.

Validators could put a portion of the validator rewards (eg 1%) in a fund which will be used to grow the network and REGEN value. Big support for these kinds of initiatives.

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The original intention was always to have as many validators as can be economically viable and technically performant.

I like the idea of expanding the set now, and believe that the minimum number to consider is to include the validators running the chain outside the active set.

My gut is to expand to 75 or 80 now, and then to 100 after we’ve gotten a few more big network upgrades completed.

Ultimately I’d love to see us running 200 nodes or more (which seems to be around the mac for high performance for Tendermint)

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Seems like 75 would be a great deal to allow more people in. I already know validators that would be interested.

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Although I am in favour of increasing the validator seats eventually, I think it would be way too early to do it now.

All of them are validators from the testnet.

Yes most of us are, which is a plus point in my humble opinion as we were during testnet, and are more familiar with network than the validators who joined after mainnet.

As @willszal mentioned the token just floated, and we may not wanna attract the wrong type of validators on the network who are in it just for some quick gains from rewards.

Most of us are running their validators since mid April, before their was any token :slight_smile:

That being said, the end goal should be to increase the validator seats but I think maybe wait for a little more time.

But If we decide to increase the validator seats and make a proposal for it soon, I think regen foundation should not delegate huge amount of tokens to these new delegators, lets wait for them to prove their worthiness :sweat_smile:

The first point that did take my attention to make this proposal is that some of them, are actually not active, with delegation allowed from the team.
I personally found this as a mistake (and I’m not concerned).

I think a bigger mistake would be to delegate huge amount of REGEN to the new validators so early.

That being said I am open to hear otherwise, and open to increase the number of seats but think It would be nice for Regen Foundation to consider the performance and loyalty of the new validators before delegating to them :slight_smile:

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I think attracting new validators to the network is good for Regen, but agree that incentivising in a way that promotes participation is important.

We saw in the Akash increase of validator cap that a demand for AKT was seen as validators attempted to get themselves into the active set. See here for the discussions around how we went about getting that passed: Proposal: Increase of 'max_validators' cap - #40 by KamuelBob - Proposals & Votes - Akash Support

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Excellent points here KingSuper! Thank you for your thorough review.

As one of the people helping to set CSDAO Treasury policy, I too have concerns about just blanket rolling out to all the existing policy to new validators. I’ve already noticed that a number of our validators validate for a dozen or so networks, and I would like us to have a validator set that has a number of validators that are meaningfully engaged in the community, not just in validation. As you mention, a network founded on regenerative values but with no token price attracts a different kind of validator than a network that’s producing $1mm+ of staking rewards each week… Just to say, the Foundation will carefully consider its delegation policy in light of a validator set increase, and I’m not yet sure what we’ll implement.

One other factor that hasn’t entered the conversation yet: what are the numbers on network performance as we increase the set (the more nodes, the longer it takes to propagate information across the network)? I know plenty of Cosmos chains have more than 50 validators, but just wondering at what point this becomes a significant factor.

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Thank you for your return Greg !
75 seems to be a good first start, I explain why and hope it convince @KingSuper and @willszal:

  • First, it will allow the 12 first validator to join the movement. We are all aligned with this first shot.
  • Secondly, why 13 more validators?
    I’ve been in multiple chain, and when there is an increasement of seats, there is always some great validator that join the chain and create tools for it.
    You want to have validator implicated in Regen Network; I don’t think you will be able to see in reality before testing it. Blockchains project always provide amounts to anybody that pretend to do anything, but your not even sure on what they will do.
    That’s why, adding 13 more seats is actually viable as there is already 30 validators waiting.
    You will be able to judge how validators react to this.
    Will they just add big amounts and validate, or will they come here and participate in the ecosystem growth? Nobodies knows ! We are in a decentralized ecosystem, we cannot control everything !

Actually, adding 25 more seats won’t have a big impact on the chain. And I think it will motivate some validator to be more implicated.

I think we can make the proposal before the end of the week, as it seems to be in lines with what the team wants and the community too.

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It’s really interesting to hear about past experience from other validators thank you @kamuelbob. On this note, I’d love to learn more and curious if any other validators have had experience with increasing the validator set especially regarding the larger context and impact,

For example

  1. is there a relationship between a larger validator set and other important updates such as ledger upgrades and ledger application development
  2. how will this community/RND decide to improve new participant experience
    e.g. https://www.regen.network/validators/ vs https://solana.com/validators
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As Simply Staking we believe that increasing the validator set size is an important part in growing the network. We fully agree with taking smaller steps and going to 75 before going to 100 and upwards, this is a small enough step to allow the network to grow organically and not too rapidly, and large enough to allow new validators to join and bring something new to the table in terms of participation and possibly tooling.

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I wrote this post on the subject of expanding the Regen validator set, using feedback from the Regen team.

It feels hopeful to see @StakeLab introduce the proposal :slight_smile:

I’m generally in favor of expanding the set. To me, the validators with non-zero balances should be included first. It’s also notable that these validators also have very high self-stake %'s. So I guess I’m in favor of raising the limit to 62-65.

Something I’ve never seen in any “expand the validator” set conversation on any network is an actual financial analysis of the impact of increasing the set. This would be very interesting to see, if anyone has the skills and availability to draft it.

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We are Akik Takat, currently ranked 12, with 2.82% of voting power. We run a validator, and also participate in the implementation of Regen Network and the Community Staking DAO.

The active validator set has the following distribution of stake (linear scale):

In the Aneka explorer, all the inactive validators that have stake are listed as “last seen 2 [or 3 or 4] months ago”. Is this a bug in the explorer? Or did the inactive validators with stake really turn off their machines a few months ago?

If the current proposal passes, increasing the active set to 75 validators, and those inactive validators that Aneka hasn’t seen in months come back online with the same amount of stake, then the distribution looks like this:

Spreadsheet for whomever wants to use it:

Staked tokens have passed 67% (currently 68.06% bonded, according to Aneka) and inflation is going down. I think inflation decrease and fluctuating REGEN price in USD will have a bigger impact on validator finances than increasing the validator set.

The current veto power is the top 6 validators (35.74%) and the current passing power is the top 18 validators (66.94%) (maybe there are more technical terms for those thresholds). This will probably not change just by increasing the validator set, therefore I think it is not true that increasing the validator set will increase network decentralization and therefore network security. What do you think?

What kind of financial analysis is possible? In broad strokes, I see that the inactive set has 0.18% of current stake. That seems insignificant in terms of diluting the validator rewards and commission. What @kamuelbob says about AKT demand increasing when the validator set increased… if that happened, then maybe the value of REGEN would increase by enough to balance out the slight dilution of rewards. If rewards were distributed equally among validators regardless of stake (like Desmos proposes), then increasing the validator set by 50% (to 75 validators) would have a predictable and significant impact on validator rewards. But with stake-based rewards, and with stake distributed unequally as it is, I think there are too many unknowns to do a useful financial analysis. Also, delegator decisions are often based on reputation and relationships. Maybe someone has staked 50,000 REGEN with an active validator, but they’re waiting for their friend’s validator to enter the active set, and then they’ll redelegate to that newly-active validator. So, validator rewards are based on these unpredictable human decision. What do you think?

The current cost to get into active validator rank 50 is apx 172,000 REGEN (@ USD $2.15/REGEN = USD $369,000) and to get to rank 40 is 479,000 REGEN (@ USD $2.15/REGEN = USD $1,029,850). If the active set increases to 75, then we don’t know how quickly this will change. Will there be demand for REGEN in order to delegate to the new validators? Will the new validators mostly get re-delegations? We don’t know.

What’s the difference between this versus the community pool?

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from that post:

Consistent with the thinking behind selecting 50 as the initial number, validator sustainability will be key to determining whether the proposal passes. Validator sustainability is related to the amount of fees moving through the network. The amount of fees is tied directly to network utility.

So as network adoption and utility increases, fee volume increases too. Higher fee volumes can support a larger validator set. A proposal to increase the validator set should then be more likely to pass as the network’s utility grows.

Currently, most blocks have zero transactions, and those with txs have 1 or 2, so fees are pretty low. Validator revenue is from commission, as far as I can tell.

I’m looking for the post about how blockchain held the promise of decentralizing finance, but has just maintained the trend of channeling more money to people who have the most money. Did ChainFlow write that, or someone else?

If I vote yes on this proposal:

  • it won’t be because of ideas of network decentralization
    • (I think network decentralization won’t happen via expanding the validator set, at least not right now with the current distribution of stake, as explained in the charts above. I think decentralizing stake has more to do with validator reputation among REGEN holders, unless we create a parameter / software change that changes the way commission and block rewards are distributed, as mentioned in community conversations months ago, or the way Desmos works, distributing block rewards equally regardless of voting power),
  • nor about financial viability
    • (the income of validators in dependent on 1) how much REGEN is staked with them [commission] and this won’t change by expanding the validator set unless the expansion leads to re-delegation away from current validators, and 2) how many blocks they validate [block rewards] and this will change for smaller validators, it may even cut in half for smaller validators, but as far as I know, this income source is relatively small at the moment, especially since there are so few transactions on the network right now. That income, minus their costs, gives the operator net income, which has many variables. Current estimated income ranges from USD $21,500 (validator #1) to $664 per month (validator #49). That lower end in enough for a single-node cloud validator and a full time person earning just above minimum wage in Ecuador, but I don’t know if that counts as “financially viable.” Depends if validating for Regen Ledger is their only source of income. Running a node in that way takes only a couple hours per month of attention, so I think it’s financially viable in Ecuador, even if it’s not very secure. Probably not financially viable for someone living in a penthouse in Singapore).
  • nor about opening the set to testnet participants
    • (there were apx 175 testnet participants, and we’re not going to expand the validator set to 175 this month, so choosing 75 seems arbitrary. The 4 highest-ranked inactive validators are actually offline, as far as I can tell, based on the fact that ART3MIS.CLOUD [ranked #5 among inactive validators] just made it into the active set for a few hours, while those ranked 1-4 didn’t make it into the active set. Therefore I assume they’re offline. So using the list of inactive validators on Aneka seems inaccurate as a way to gauge interest of potential validators.).

If I vote yes, it will be in order to open the validator set to the possibility of more validators who are engaged in local and bioregional regeneration in their lives beyond computers, so that they can use validator income to sustain their regenerative activities.

Would CadCad be useful for doing an economic analysis?

I am not sure how to calculate validator income in a very precise way, and I don’t know advanced mathematics, and I don’t know enough programming to do precise CLI queries of the network data. So I’ve taken the “tail” of the current validator set (validators ranked 21-49), taken the average change in delegations between those validators, extended that out to 75 validators, calculated the percentage of delegations each validator has, and then redistributed the current bonded REGEN among all 75 validators based on that percentage. Why do it this way? Because those are my assumptions.

For the finances, I took Akik Takat’s two-week income and commission rate and used that to estimate the income for other validators. It’s all in the spreadsheet linked in my earlier post.

The net result: if the active set is expanded to 75 validators, and the current bonded REGEN is re-delegated as in my simulation, then the current 50 active validators lose 5% of their current commission income. The price of REGEN has varied between USD $2.08 to $2.24 over the past 24 hours, that’s a 7% change. So, in concrete terms of validator financial viability, I think the validator set expansion will have relatively little impact compared to:

  • validator reputation among REGEN delegators (the single biggest factor),
  • commission rate (the easiest factor to modify),
  • USD price of REGEN (based on the mix of token utility and market volatility and speculation),
  • validator operations model (capital and operational costs; how many chains do you validate for),
  • validator personnel payments (is this your main source of personal/family income?).

I have updated all this in the spreadsheet linked in my first post in this thread, so you can download it and modify it if you want. Here are two charts that show the simulation.


The impact of commission rate here is very visible: Tavis Digital has 2.4 times more delegations than Akik Takat, but charges 2% commission instead of 10% commission, and therefore has lower estimated monthly income.

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On the community call just now we talked about the current governance parameters and the Byzantine Fault Tolerance of the network. This changes my understanding of network security. I thought governance proposals required 66.7% approval of all bonded REGEN (i.e. 66.7% of all online voting power), but in fact passing a proposal only requires 40% quorum and 50% approval, as seen in this screenshot of the parameters page on Aneka:

image

This means that a vote could happen with 40% quorum, and within that 50% approval means 20% total approval (50% of 40%). For parameter change proposals, the parameters are changed once the vote passes. For software upgrade proposals, after the proposal passes, 66.7% of voting power must perform the software upgrade in order for the chain to continue.

So, now I understand network security a bit more:

  • If 33.4% of voting power goes offline, then the chain will halt. That currently means the top 6 validators, or the bottom 32 validators.
  • If a bad proposal were submitted, and 20% of voting power were hacked (top 3 validators, or bottom 23 validators), and another 20% of voting power voted no, and we didn’t find some other way to respond during the 2 week voting period, then the bad proposal would pass. (By bad proposal, I mean something that would destroy Regen Network, not a functional proposal that I disagree with).
    • Therefore, if I see a bad proposal that hasn’t reached quorum, it’s better to ignore it instead of voting no, because that way the proposal won’t reach quorum. If the proposal passes quorum, then voting NoWithVeto is a good idea, and we need 20% + 1 to vote no if 20% voted yes, or 33% NoWithVeto if more than 33% voted yes.
    • Veto threshold is 33%. I assume this means that if 33% of voting power votes NoWithVeto, then the proposal won’t pass (documentation is not clear).

This also means that if a proposal is passing with 60% of the vote, it could still fail if 33% voted NoWithVeto.

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