[POLL] Should we consider redirecting Top-N rewards?

We don’t mean to undermine the immense complexities involved in changing the whole economics behind the ICS reward distribution. Currently these rewards are distributed to the stakers, leaving most holders with a lot of dust tokens in their wallets. This liquidity ends up being heavily fragmented and mostly “lost in the void”. Regarding the enormous amount of work this would take to gather reliable data and build a model to guide a governance debate on this subject, we thought it would be wiser to perform a “temperature check” first. Please vote on the following poll to signal your willingness to enable such research or not: • YES • NO • ABSTAIN • VETO 0 voters *Votes are anonymous, we also provided a VETO vote to show strong opposition. In any case we would be pleased to have a brief explanation on the reasons that motivated your votes in the reply section below. Edit 28/01/24: To ensure the topic remains relevant, we have edited the title to clarify that we are not proposing any specific solution. There appears to be a misunderstanding as we initially suggested redirecting to the comm. pool. In reality, our intention is to initiate a broader…

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It would be useful to include where the rewards currently flow to.

This would allow for a Pro & Con list to be developed.

Thanks, I’ve updated to mention the current distribution to stakers. The goal of this “temperature check” post is to make sure the community is willing to open these pros & cons discussions. We want to avoid another mess like the inflation debate where most people were deeply uninformed. Instead we want to lead an informed and data driven reform on this ICS reward subject. To do this we will have to gather a lot of data and build models to show the changes certain modification would do to the entire Hub’s economy.

Though this vote we want to make sure there is a community interest in this matter, otherwise we won’t bother collecting the data and building the model!

I’m supportive of research on rewards going more towards the community pool and validators than stakers.

One of the earliest incentive alignment issues with ICS was that stakers are fully incentivized to bring on as many consumer chains as possible because there is no cost to them, whereas validators must be much more selective in onboarding chains due to the infra costs. This misalignment is stressful, as the relationship between stakers and validators can hinge on governance votes, and validators should not feel pressured to race to the bottom (in terms of validating consumer chains for inadequate rewards) to appease their delegators.

I tend to agree with everything that Lexa has put forward.

I’m definitely in favor of this initiative. I’ve been waiting for a change in the ICS reward distribution system. This fragmentation impacts the overall ecosystem’s efficiency.

I am open to discussing possible alternatives. The current model is not bad, but it also not good.

• Wallet Dust
• Fragmented Liquidity
• ICS Benefit Optics
• PITA when doing taxes.

I think on a thread somewhere someone said something that was a good idea. Having a function that wallets could implement to convert tokens in a wallet to ATOM. I think Stride may have something like this on their application called “Dust Sweeper”, I have never used it. This wouldn’t solve my tax filing woes though. lol

Alright, I will stop throwing out ideas and suggestions as this is off-topic and this is just a temperature check.

Have we giving up on the idea for rewards to subsidise atom inflation? I was under the impression that was always plan? @ThePowerCosmic raises a good alternative and we could explore integrating a “Dust Sweeper” via fee abstraction in the future.

I agree with Lexa’s note about misaligned incentives.

But taking all incentives away from stakers (bar bigger community pool) isn’t the ideal solution.

Don’t validators get block rewards anyway?

On the fragmented liquidity and dust sweeper, perhaps a better solution is to have ICS rewards paid to everyone as ATOM? So convert at distribution time - more frequent swap actions, automated, instead of stakers performing an action.

ICS rewards paid to everyone in $ATOM YES, that is definitely a very good one indeed.

@meandme, @Pookybear ,
I don’t dislike the idea of getting rewarded in ATOM, but then the argument could be made, why get rewarded in any of these shared security tokens at all? It would be interesting to get paid in USDC if Noble gets onboarded as a shared security chain. Though, I can see regulatory scrutiny and the optics with that one (i.e. interest).

At the end of the day, I think the dust is the main problem for delegators.
No sizable chunks to do anything with.

I feel like we just came full circle on “atom as ICS currency”. I think there was a reason for not doing this on the onset. Can’t remember what the argument was at that time.

Word?
I would guess the ATOM would have to come from somewhere or you would be inflating ATOM even more? I am also not sure how such swaps would impact the other coins price (if at all). If someone knows anything about this, please chime in.

Govmos: Leaving most holders with a lot of dust tokens in their wallets This Trojan Horse proposal to overhaul the ICS reward system is not only misguided but a clear threat to Atom’s core tokenomics. It should be rejected. Let’s call this out for what it truly is: a setup for a money grab. First step, centralize the value, second step, then the whales will extract that value for their own benefits. They will be laughing all the way to the bank. Furthermore, the portrayal of smaller token holdings as “dust” is a deceptive tactic that grossly undervalues their true potential in the crypto landscape. Such misleading language aims to distract from the real issue: the long-term growth potential of these assets. Every token, no matter its size, forms the backbone of the Cosmos ecosystem’s strength and future economics. A dusty amount of BTC 0.10 is worth over $4k. It’s not only the quantity of a token that matters, it’s also the price. A straightforward and fair alternative, without needing a governance proposal, is to post the community public wallet’s address. This way, anyone who wishes to donate their tokens to the community pool can do so voluntarily. This…

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it should be a choice to keep the rewards in dust tokens, or to autoswap it by an ics dex, or whatever

Govmos: we are not proposing any specific solution. There appears to be a misunderstanding as we initially suggested redirecting to the comm. pool. Govmos’ claim of not proposing any specific solution directly contradicts their recommendation to redirect funds to the community pool. This isn’t just a subtle recommendation; it’s a clear-cut proposal that speaks volumes about their intentions. Let’s cut through the noise here: what we’re seeing is a classic bait-and-switch tactic packaged in the context of “communal benefit”. This isn’t about communal benefit; it’s a thinly veiled attempt to centralize control, setting the stage for a select few to hijack the system for their own gain. It’s a strategy as old as time - gather the resources in one place, then let the big players sweep in and take it all. They’re not just undermining Atom’s core tokenomics; they’re setting us up for a fall. For those championing this proposal, put your tokens where your mouth is. If you truly believe in this, donate your tokens voluntarily to the community pool. Don’t hide behind governance proposals to force others to give up their holdings. This proposal is an alarm bell for…

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lexa: One of the earliest incentive alignment issues with ICS was that stakers are fully incentivized to bring on as many consumer chains as possible because there is no cost to them, whereas validators must be much more selective in onboarding chains due to the infra costs. This misalignment is stressful, as the relationship between stakers and validators can hinge on governance votes, and validators should not feel pressured to race to the bottom (in terms of validating consumer chains for inadequate rewards) to appease their delegators. Your post raises concerns about the incentive alignment in ICS, particularly regarding validators and stakers. However, this argument lacks solid data to back up these claims. If you’re asserting that large validators are facing economic hardship due to infrastructure costs, then it’s crucial to provide concrete evidence. If validators claim economic hardship, they must prove it with fully audited financial disclosures. No more beating around the bush – we need transparent, concrete evidence of these so-called expenses and revenue streams. Without this data, their claims hold no water. Validators, it’s time to lay your cards on the…

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Tbh a simple dust sweeper would solve this.

Maybe, auto-converting all Stride tokens to St ATOM ?

Voted no, Would rather see the rewards all get converted to atom or statom before rewards go out to stakers

It is a big no for me. Communty pool receives ICS rewards through 10% community tax. Why do we need to take all from stakers and validators to fund the community pool.

Even though this rewards are small they are rightfully theirs since by staking they are securing the network. This can be resolved by making a dust sweeper that turns rewards into ATOM.

Is there any specific reason community pools need an extra funding? At the moment current worth of the pool is almoust 80 million dollars. I do acknowledge that more than 50% is NTRN and that some other blockchains have bigger pools but Cosmos Hub was asked multiple times for funds. I did a quick glance of the community pool spend for the last year and there was spent about 4 million ATOMs on which I think about half was spent for LP pools.

We could wait for community pool to stockpile for a while and maybe be conservative of how we use the community pool or we could use NTRN and other assets frrom the pool to fund future projects/initiatives.

This proposition you have is consistent with the option we foresee for this reform. What you propose could be achieved by redirecting the rewards in dedicated covenants in neutron, swapped to ATOM and distributed daily, weekly, monthly… This post isn’t meant to design the new system. Just see if we want to collectively open that door and figure out solution together.

Sending to the community pool in order to fund more PoL (protocol own liquidity) is just one of the many possibilities we could explore. In the meantime this is NOT the purpose of this vote. This is actually quite simple, this vote is querying community feedback to see if we want to change the current system. A Dust sweeper design is very interesting, but currently can’t be delivered due to the minimalist nature of the Hub which we want to maintain as a top priority. This means if we want a dust converter, this requires to process it outside the Hub, and therefore redesigning the system. If you support that thesis, your vote should be YES, and then participate in the community debate to support the sweeper as your favorite option.

Thanks for raising this discussion. We have been thinking about this, especially in the context of smaller rewards which for smaller accounts that claim frequently may cost more in gas to claim than they are worth. We haven’t been sure how much to prioritize this though since partial set security will change a lot of how this will work anyway. Here are a few ways: • Pass a governance proposal to turn off rewards from certain denoms. If this happens, the rewards will still be received by the Hub, but they will not be disbursed to everyone’s account. They will build up and if another proposal is passed they can all be sent out. This is the only option in this list which requires no code changes. Somebody could put up the prop today. • Modify some code so that the above proposal does not just allow rewards to build up in a holding account, but sends them to the community pool. From here they could be used for other things. • Use a special module to sweep rewards and automatically sell them for ATOM. Notional is working on this module, funded by a grant from Osmosis, and it was already approved for use on the Hub by a signaling proposal last year. However, I am not sure of the…

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@ Govmos Firstly, we need to address the core issue here. What specific problem are you aiming to solve with this proposal? Why should this even be considered a priority compared to many other needs that exist? The premise that rewards too small to claim justify such a radical change in the system is not only flawed but also overlooks the fundamental principles of reward distribution. This approach appears to be a knee-jerk reaction rather than a well-considered solution to a clearly defined problem. Govmos’s suggestion of redirecting funds to the community pool to enhance Protocol Owned Liquidity (PoL) is riddled with flaws. This approach assumes that confiscating individual profits from stakers for community use is justified, overlooking the fundamental principle of reward for participation. It’s a classic example of overreach, veiled as community good, echoing the dangerously misguided “Woke Mindset.” Secondly, the belief that stakers’ rewards should be diverted to the community pool undermines the very incentive structure that drives participation in the ecosystem. Stakers contribute to network security and governance, and their rewards are a rightful return on…

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There is considerable wisdom in your response, and we appreciate you outlining Informal’s current position on this matter. Technical feasibility was not the primary challenge in this initial post; our main focus was on securing early community approval to commence collecting and organizing data concerning those ICS rewards. The current status of the vote indicates a supermajority (two-thirds majority) in favor of supporting the research initiative.

We plan to allow another week to pass to gather more samples and then proceed with constructing a model to determine the best technical solutions. Some of the replies provided in this discussion have already assisted in narrowing the scope, and we anticipate that the data-model based approach will contribute to resolving the matter effectively.

Govmos, your enthusiasm for early community approval and data collection is noted, but your reliance on a paltry sample size of 38 voters to justify moving forward reveals a fundamental misunderstanding of what constitutes legitimate community consensus. Let’s dissect this glaring oversight: a “supermajority” based on 38 responses is laughably non-representative of the Cosmos Community at large. This isn’t wisdom; it’s statistical naivety. Moreover, the actual voting mechanism in Cosmos, where votes are weighted by the amount of ATOM controlled, further skews your so-called supermajority. A single participant among the minority participants can wield disproportionate influence, particularly if they’re a larger ATOM holder. Ironically, these larger holders, who gain the most from the ICS Rewards system, are unlikely to support what could be perceived as your grossly misguided initiatives. Your approach, waiting another week to “gather more samples,” is equally misguided. Without addressing the fundamental flaws in your sampling method, any additional data collected will remain fundamentally flawed. This isn’t about narrowing scope or technical solutions; it’s about…

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People will always be uninformed so we’re not stopping innovation because people are uninformed. Two weeks of forum discussions and 2 weeks of proposal voting time is plenty of time for people to get basic information about any subject.

Monetary inflation is PhD level subject so you can teach it to the average person for a lifetime and they still won’t get it. A lot of people can’t perform basic math operations much less comprehend monetary inflation debates. It is totally ridiculous to think that the average person is a PhD level economist and can have similar types of insights. We all use money daily but that doesn’t mean we know anything about it.

We use cars every day too but if I ask you to talk about how the car’s engine works, pretty sure you don’t know. And the average person doesn’t need to know. If car engine knowledge was a requirement for driving cars, nobody would drive cars.

I am for 1. I invest in a bunch of coins and two years later I only notice the ones that have gone up in value a lot. The default should be rewards should just accumulate somewhere and then when one of the coins gets to a decent valuation (let’s say, $1 billion market cap) then there is a proposal to send them out.

I agree with the point you raised here, but let me reverse engineer it for a moment. Would we even have cars in the first place if there was no PhD-level thinking to achieve building them? On this matter, I would argue that your argument doesn’t hold when we are pioneering. Defining a distributed network’s PoS inflation modeling isn’t easy, and from my point of view, informing people can only be a net positive. Even if most of them don’t understand or just don’t care, I will never consider skipping the information-sharing phase before a vote like this. We see the same necessary debate when it comes to distributing rewards. The current system might lead to certain inefficiencies (that’s our standpoint to open a reform). If we open negotiations on the terms, information has to be part of the process in our humble opinion. You might have a different vision of the due process before voting, but we’re not asking for community funds to perform the data mining nor the modeling. To conclude, at Govmos, we truly believe in collective intelligence. Multiple studies have shown that an uninformed crowd can reach a better answer than an informed selected few. That’s actually the main…

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I don’t think Cosmos Hub tokenholders are an “uninformed crowd”. There is this tendency to think that “markets” are an “uninformed crowd”. That couldn’t be further from the truth. To be a market participant, you need to own a financial instrument. That immediately puts you in the top 10% of any society. 90% of people don’t have math skills or any other distinguishable skills for that matter and as such don’t have the ability to save, ie store energy. So market participants by default are already the smartest 10% of any society just by virtue of demonstrating an ability to store energy, save money and buy a financial instrument. When you talk about “markets” vs “committee based decision making” (or communism, the Russian “soviet” means “committee” in English), you are not talking about a contest between the idiot crowd and the educated professional, but a contest between experts who have shown ability to extract storable energy out of an activity (“market participants”) on small, medium and large scale vs academically certified experts (who may or may not have not shown that ability). In other words, capitalism vs communism isn’t the crowd vs expert, but the highly capable…

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vixcontango:

BTW, the inflation posters were absolutely correct. The Hub was overpaying for security. Despite the cut in rewards, 2 months later, the bonding ratio is still around 65%. The projected massive unstaking by the critics of the proposal didn’t transpire!

I won’t name any names here, but there were unquestionably false statements in the forum discussions. Moreover, these statements were deeply misleading, to say the least. This was evidence of a lack of basic information. Once again, we agree with almost all of what you said in this post, but the critical aspect here is that if you query the market’s collective intelligence with false information, the magic won’t work anymore. Let me tell you that after 13+ years of dealing with financial markets, when you deal with false information, you get incorrect results, and being disconnected from reality can only last until you realize it. That’s why we want to set a basic standard of information checking during the forum discussion phase, to make sure the vote is performed under the best circumstances.

Vixcontango offers a strong case for the effectiveness of free markets, pointing out Govmos’s significant misunderstanding of decentralized decision-making. The proven track record of free-market economics demonstrates the shortcomings of centralized control, aligning seamlessly with the Cosmos philosophy. The notion that market participants form a more informed and capable segment of society underscores the strength of decentralized systems. These individuals contribute diverse expertise, driving innovation and resilience far beyond what centralized models can achieve. Diversity isn’t just an attribute but the core driver of superior market outcomes, affirming the decentralized approach intrinsic to Cosmos. Govmos’s proposal to steer community decisions through a select few starkly contradicts Cosmos’s fundamental principle: empowerment through decentralization. Historical evidence and basic economic principles confirm that decentralized markets consistently outperform centralized ones. The true strength of Cosmos lies in its community’s collective intelligence and creativity, not in centralized control. The future of Cosmos, and any decentralized ecosystem, hinges on its…

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This way of doing things reminds me of what Aristotle advocated in Politics: a mixture of democracy and oligarchy. This allows you to avoid the excesses of both systems and benefit from the best of both. Democracy is harder to corrupt but has difficulty moving in one direction and oligarchy is easier to corrupt but has an easier time following a clear and defined path. He essentially saw two ways of achieving this mixture. Either it’s the oligarchs who write the laws and it’s the people who vote for them, what he calls constitutional government, either the opposite.

The advantage of such a system is that those who write the laws have no incentive to go against the interests of those who vote for them, otherwise they will only pass if those who vote are misinformed.

It is possible that what I wrote does not completely reflect Aristotle’s thinking, I just wrote what I remember and understood.

@Alexandre_Collard , Thank you for your enlightening contribution. Your exploration of the nuanced balance between democracy and oligarchy, inspired by ancient wisdom, strikes at the very heart of our governance discussion. Your post astutely highlights the philosophical core of this proposal: the contrast between centralized governance versus decentralized, distributed governance. It’s important that we have a clear and consistent vision about the Governance Principles for the Cosmos Ecosystem. I believe those principles should uphold the following: • Decentralization of Power : Governance should not allow power to concentrate but rather spread it throughout the network. This approach champions the belief in the inherent right of individuals to self-governance and the collective wisdom that emerges from distributed decision-making. This proposal leans towards centralization, therefore violating this principle of Decentralization of Power. • Individual Sovereignty : The autonomy of each participant within the Cosmos Ecosystem to freely make decisions impacting their assets and operations is paramount. This reflects the fundamental notion that individuals are best…

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Wisdom transcends generations, and governance has always been a challenge for humanity. We firmly believe that blockchain-based governance is the next frontier, applicable to both the public and private sectors. This is why we are so interested in Cosmos, and specifically the Hub, as it pioneers this field. We consider this an impending revolution, bringing both positives and likely some distortions along with it. Nevertheless, it is expected to be a net positive compared to current systems. This is a topic we could debate for hours without ever getting bored. It is also the primary reason why we named our initiative “Govmos,” as most people should have figured out by now!

Despite the love we have for governance discussions, it feels like we have deviated from the initial purpose of this topic. We have many more things in our roadmap regarding governance research and debate, and perhaps we should open a separate topic with @CML and other individuals who seem to be interested in the matter.

Easy yes, there is no interest for small holders to get fraction of tokens which cost more to transfer/swap for them than the value of these fractions.

There are many issues that have not been carefully thought through, causing many unnecessary problems [Facing a problem is the first step to solving it] • The increase in pledge rate comes from innovation and reform activities and from obtaining airdrops. A large number of small amounts of funds are pledged in order to obtain airdrops Community confidence has not increased and offset each other so 67% is still far away This shows that holders are not very interested in ATOM • The distribution rewards obtained are much smaller than the rewards for staking ATOM. Unless it can be greater than the staking reward of ATOM, I feel that allocating consumption chain rewards to everyone does not form a meaningful incentive for holders. [Consumption chain rewards must be accumulated into the prize pool and distributed to those who hold ATOM for a long time] Declared today - 360 days due distribution Distributed according to four seasons (rewards for each season need to be doubled to be more attractive) If you stake for more than 90 days, 5% of the reward pool will be allocated If you stake for more than 180 days, 15% of the reward pool will be allocated If you…

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I like the design behind that idea, but we have to remind you that the current topic isn’t meant to propose any solution yet. We the current status, we only meant to gather early approval in order to collect data and start a debate on the potential solutions at a later date. This data will be essential to guide us correctly with the actual numbers showing the fragmentation as it really is, as well as the growth trends and global rewards distributed so far.

Anyway your solution is interesting and would definitely be worth presenting in this forthcoming debate. Looking at the current status of this poll we are planning on moving forward with this data mining endeavor early next month and we will hopefully be able to present this to open that debate in early Q2.

like it, need to discuss about it

I understand
This is just a simple idea, and we need everyone’s ideas to work together to improve it.

I tend to agree that some research needs to be tackled to address the subject of ICS rewards issues. It’s not just a matter of these rewards being insignificant for some stakers; there are broader concerns, such as the potential increase in costs associated with claiming ATOM staking rewards.

I looking forward to see the outcomes of the future studies!

Just auto-swap it for ATOM on Neutron before it hits the distribution module and pay delegates in ATOM.

reduce the community tax, redirect ICS revenues to the community pool?

so validators 5x taxes on delegators to grant farm the CP, and are now discussing redirecting the dissapointing ICS rewards into the CP instead of
delegators who have seen nothing in return for the taxes validators force them to pay?

How is reducing delegator rewards, again, going to make ATOM more appealing as a staking asset?

[POLL] Should we consider redirecting ICS rewards? Proposal Ideas

Just auto-swap it for ATOM on Neutron before it hits the distribution module and pay delegates in ATOM.

I imagine it needs more gaz fees to do that ?

Doesnt a portion of ICS rewards land in the CP?

It might be possible in the future. ICS/PSS chain can easily design allocation of some of their revenue sharing back to the CP. At present this isn’t the case. It may also change if we ever pass a community delegation program. This would effectively make the community pool eligible to receive staking rewards (and therefore a share of the revenues from CC (Consumer Chains).

After reading the comments here, I understand why most people prefer BTC or Memecoin.

Heh. I was under the wrong impression than. Then, Yes, im in favor of portion of the ICS rewards ending up in the CP

The ICS 2.0 Partial Set Security (PSS) implementation needs to be debated once it’s in effect. This system involves intricate economics and can take various paths to adoption. Depending on some circumstances, we may charge an operating fee on the Cosmos Hub, with some ICS proceeds directed to the community pool. We’re considering top-n agreements following this approach, and they might receive partial funding from the Hub, either directly or via the AADAO. This is something we’ll explore in greater details in a forthcoming post about the PSS economics.

First of all, HUB should first consider the situation of the majority of people (95%) instead of thinking about the multi-millionaires (5%) who can sell rewards every day! The reason why dust is dust is that even if you have $500,000 in assets, the general daily reward you may receive is less than $1, and how many people with less than $50,000 will receive (less than $0.1 reward) If you distribute 100,000 rewards to 1 million people, each person will only get 0.1 US dollars on average. If you accumulate this 100,000 rewards and use them for other things, you can achieve greater benefits! (Whether it is liquidity or Wait until the project has certain results before making the exchange) I believe everyone understands the principle of piling sand into a tower, but now it is a pile of loose sand (95%) that falls to the ground and is of no use. Faced with the plummeting ranking of Atom Hub’s inflation pressure, this is a sense of crisis, and plans to reduce inflation should be regarded as top priority. Redirect Reward This is a necessary direction! Passing first is the first step! When the reward reaches a certain size, do the second step! This is not for personal…

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it is a strong agree for me, need more discuss about this

it all goes into the same 5 year old basket of “the cp needs to be managed” (imo, onchain - but there are no ((good)) tools)

In light of the recent introduction of Partial Set Security (PSS) and its new economic modeling for rewards distribution, we believe this is an ideal time to revisit our conversation to include these new perspectives. With PSS, consumers now operate on a curated subset of validators, and the rewards they distribute are allocated exclusively among the delegators of these active validators. This creates an intricately granular system of supply and demand for security offerings. It is important to remember that PSS includes two variable models: the Opt-in system and the Top-N, which Neutron and Stride have transitioned to. These alternative models offer distinct economic frameworks, where a set of validators is required to operate to ensure that a specific percentage of ATOM security is replicated on the consumer. If you want to learn more about PSS, feel free to read our comprehensive post about this new economic model: PSS Financial Model . To reassess a fruitful context for the “should we consider redirecting ICS rewards?” discussion, we propose limiting the scope to Top-N chains only. The Opt-in model is a free-market approach, whereas Top-N is more community-oriented. In our…

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YES. Makes sense. Receiving 20 micro dust positions worth less than a cent is useless and messy.

Opt-In chains will have a smaller vals set (+inactive vals?), customized rewards system so better to not touch it and let them do their things. For Top-N chains I do think it’s a great idea as it concerns all validators and so all stackers.

An integrated dust sweeper would be fine but as a Ledger user I can say it can be fastidious. For example the Stride dust sweeper still forces you to review 25 pages by assets I sweep, so if I sweep 7 StTokens to stride I have to review like 25 pages X 7 in one Tx …

Plus I guess you pay more fees if you sweep small amounts compared to a big one. So for me it makes sense to redirect ALL ICS rewards to a pool (Sub-DAo), swap to ATOM and USDC and wait for it to reach a certain amount to automatically redistribute to stakers.

If in many years the hub feel like using those funds for something els they could still propose something to governance but for the first iteration we should just prefix a certain amount to reach and wait.

Hello, Govmos. Thank you for this post.

Govmos:

Currently these rewards are distributed to the stakers, leaving most holders with a lot of dust tokens in their wallets.

Wasn’t one of the main point participating, especially from a delegator’s perspective, in a proof-of-stake system, to help decentralize the network by taking on “skin/stake in the game,” to help ensure the chain is secured? Incentivizing any/all participants to convert as Stakers instead of passive “Holders.”

lexa:

validators must be much more selective in onboarding chains due to the infra costs.

meandme:

But taking all incentives away from stakers (bar bigger community pool) isn’t the ideal solution.

Don’t validators get block rewards anyway?

Though validators should absolutely be compensated for their work, from how things currently operate, validators aren’t required to bond N amount of their own atoms when serving - unless i’m wrong?

FHZ:

Though validators should absolutely be compensated for their work, from how things currently operate, validators aren’t required to bond N amount of their own atoms when serving - unless i’m wrong?

We don’t mean to decide where to send the funds nor what to do with them, but accumulating and using this in conjunction with the forthcoming votePowerTax in order to support small validators is one potential outcome. For now, this proposal simply aims to gauge initial reactions from the community, serving as a basis to determine whether a comprehensive discussion should be pursued. Should this direction be deemed feasible, we will welcome all suggestions regarding the process. As of the publication of this post, the poll indicates a 66% approval rating from 76 participants. We will not proceed until a minimum of 100 individuals have contributed to the poll.

Why would one sweep the funds into ATOM which is guaranteed to lose -10% per year due to its inflation schedule? ATOM hasn’t been able to maintain below 10% inflation ever since they put the 7% min to 20% max and 67% bonding ratio parameters in production. Even now the only reason inflation is 10% is because the max parameter was reduced to 10%.

I don’t think it is very likely the ATOM community to vote for further inflation cuts. This is a community that either doesn’t understand supply and demand dynamics very well or is simply full boiler room penny stock dumper artists.

We can swap to USDC if the community prefers, I proposed ATOM so we don’t add another sell pressure. The main point is to ensure that

• Funds are send to a different pool that the community pool
• Can’t be access
• Are redistributed to stakers once it reaches the targeted amount

CML:

This proposal leans towards centralization, therefore violating this principle of Decentralization of Power.

So long as this isn’t a means to further echo/manipulate into existence another centralized governing body w/o having disclosed clear conflicts of interest, considering the current alleged state of ICF/Informal, i’ll remain curious to see how the broader community reacts to this discussion!

*Edit: Will remain strongly opposed to utilizing governance to indirectly reward those who hold Atom passively vs. those who stake. This post also seems to faintly echo advocates of Prop#848, and we all see how thats working out.

Nonetheless, always appreciative of individuals/teams initiating active discussion before any teams/actions are formed, so thank you in that regard, Govmos.