SKALE Delegators and Validators Overview

What are Delegators and Validators?

• Delegators: Network participants who stake their SKL tokens with validators to earn rewards. They enhance the security and decentralization of the SKALE Network without managing infrastructure.
• Validators: Entities responsible for securing the SKALE Network by validating transactions, producing blocks, and maintaining the integrity of SKALE Chains (SChains). They are rewarded for their active participation.

Key Roles and Functions

1. Delegators:

   • Delegate SKL tokens to validators in exchange for a share of staking rewards consisting of inflationary staking rewards and subscription fees paid by dapp developers.
   • Enhance network security and decentralization by choosing validators based on performance, uptime, and rewards.
   • Can switch validators to optimize staking rewards and contribute to network health.

2. Validators:

   • Maintain network security by validating transactions and ensuring proper functioning of SKALE Chains.
   • Operate multiple nodes to provide computational power for SKALE Chains.
   • Bundle nodes to efficiently handle transaction validation and computational workloads.
   • Must meet hardware, software, and uptime requirements for reliable service.

Key Benefits for Delegators and Validators

1. Delegators:

   • Staking Rewards: Earn rewards for staking SKL tokens without operating validator nodes.

2. Validators:

   • Network Security: Ensure network integrity by validating transactions and maintaining SKALE Chains.
   • Staking Rewards: Earn SKL tokens for securing the network and processing transactions.
   • Node Bundling: Bundle nodes to provide necessary computational resources, ensuring scalability and performance.

Rewards

Economic Aspects of Delegators and Validators

• Validator Rewards:

  • Validators earn SKL tokens as rewards for securing the network. These rewards include inflationary rewards as well as bounties paid from subscription fees.

• Delegator Rewards:

  • Delegators receive a share of the rewards earned by the validators they stake with. This includes their portion of the inflationary rewards and bounties that validators earn.

• Staking Model:

  • SKL tokens are staked in a proof-of-stake (PoS) model, ensuring that both validators and delegators have financial incentives, including inflationary and bounty-based rewards, to act in the network's best interests. These incentives reinforce network security and reliability.