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.

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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.

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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

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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.