Introduction

In this presentation we’re going to cover some of the basics of Cosmos ecosystem and what is the work of validators and what they provide.

What is Cosmos?

  • Ecosystem based on consensus
  • Uses Tendermint code for Consensus: 2/3 of voting power must agree

What problems can chain have?

  • Centralization (too few validators have > 66% voting power)
  • Chain halt because of lost keys or DoS
  • Security issues (on apps or in cosmos itself)

Ecosystem

  • Cosmos is a very rich ecosystem that can be interconected via IBC
  • Many different projects and goals:
    • ATOM, NYM, Sifchain, UMEE, Evmos, GenesisL1, Juno, Osmosis, etc
  • Many projects perform airdrops to stakers in other projects

What is a validator?

  • A validator is a server that provides consensus to secure the blockchain.
  • It must be available 24/7 and connected to other validators
  • It must be secured to not compromise the chain integrity
  • It has a private key used to ‘vote’ for each block

How a validator interacts in Cosmos-based chains?

  • Each validator,based on delegated tokens (PoS) has more power and more chances to propose blocks
  • Validators get a commission from each proposed block transactions
    • Stakers get rewards
    • Validator gets commissions
  • Validator votes for proposals and for their delegates unless they vote individually

What problems can a validator have?

  • Fail to communicate with others (isolated)
  • Fail to sign blocks
  • DoS attacks (sentries)
  • Double signing
  • Disk filling with blocks
  • RAM filling because of bad optimized chain code
  • Getting out of active set

What punishment?

  • Penalties
    • Jailing
    • Slashing
    • Tombstoning

Choosing the right validator (1)

  • Always DYOR
  • Avoid top 10 validators (decentralization, participation in airdrops, etc)
  • Check for experience in other networks
  • Check Validator in the explorer (missing blocks, delegations, etc)
  • Check for participation in voting

Choosing the right validator (2)

  • Avoid 0% validators -> they play badly against community
  • Check maximum commission change
  • Experience in testnets (what is tested in test, doesn’t affect you in production)
  • reStake support (via authz)

Authz

  • Cosmos chains might include support for Authz
  • Authz allows to grant certain privileges to other accounts
  • Being incorporated in major chains
  • Enables use of restake

restake

  • Restake uses authz support to grant permissions to a validator for:
    • Claiming rewards by delegator to the validator
    • Delegate the rewards to the same validator
  • Restake operator (the validator), will pay the fees for the claim and delegate
    • APY increases as restake executes periodically doing compound interest
      • Min # of tokens in rewards
      • Every ‘X’ period of time

restake function

  • Validator prepares a wallet that will keep the funds for the fees and will get the auth grant
  • Profile is updated in repository containing parameters (periodicity and min # of tokens)
    • Periodicity in the repo doesn’t need to be the real one
    • Funds are needed in the wallet for restake to cover the fees

restake function (cont)

  • Verifies the available funds on bot account
  • The software executes and reviews all delegators for
    • authz permissions
    • minimum # of rewards
  • When verified, claim+stake is performed