Staking and Mining Program. Increasing remuneration for trusted nodes.
A proposal for this came from our loyal Credits community and node holders and we would like to hear your thoughts on this.
In order to attract new users to the blockchain, as well as strengthen decentralization, we propose to have a vote for the introduction of an additional system of remuneration for trust owners who hold a node and participate in the consensus and create new blocks.
We are aiming to achieve the following results:
An increase in the number of nodes from 100 today to 1000-5000 in the coming year
Increasing rewards for participating node runners
Development of the staking program
Creation of mining pools for those who can't run a node, or nodes and are ready to delegate their coins (through the Delegation tool)
The current mechanism of consensus
Credits Blockchain is a public open-source protocol based on the principles of complete decentralization and BFT.
There are rules of conduct within the protocol, but there are no selective restrictions or bias towards the participant. Everyone is equal. Note again; it is an open network that does not limit any new or previous users and node owners.
Anyone can use the source code provided on GitHUB https://github.com/CREDITSCOM/node to assemble a node to connect to the blockchain network and take part in maintaining the network.
The node can act in 2 roles:
Regular node. Reading information from the blockchain. As a storage and synchronization node. Without participating in consensus.
Trusted node. The node that participates in the consensus. This node takes part in the creation of a new block.
Trusted nodes are selected according to a number of criteria, among them: speed of operation, stability, quality of inter-node connection, the relevance of storage, the relevance of software, existing of the staking on account of at least 50 thousand CS coins, and others.
Consensus and choice of trusted nodes imply competition between nodes for the ability to create blocks. But at the same time, as with Bitcoin, it does not guarantee that this particular node/set of nodes will create that particular block. No one can influence the choice of the trusted node, including none of the Credits team. The implemented laws of the network are the same for all network participants.
See an article on how Credits consensus works https://credits.com/news/121-credits-blockchain-why-are-we-the-fastest.html
Choice of trusted nodes
In the Bitcoin network, one node creates a new block on the basis of selection who aggregates more resources. This node receives 100% of the reward.
It's different with Credits. It is always attended by several nodes working on the principles of the collective agreement of participants on the principles of BFT, checking each other, and choosing trusted nodes. Therefore, the consensus we have developed is called Proof of Agreement.This is an example https://monitor.credits.com/CreditsNetwork/block/40626082
In this block, there are 11 trusted nodes from a total of 141 nodes. All options:
General (total) number of nodes
Number of trusted nodes
12 - 34
35 - 102
103 - 302
303 - 890
891 - 2624
2625 - 7737
7738 - 22809
A large number of trusted nodes, with an open network, makes blockchain Credits one of the most decentralized. Anyone who fulfills the requirements of the network can participate in the consensus and receive a reward.
All fees from transactions and smart contracts that were in this block are distributed to all 9 trusted nodes that created this block. In the next round, they may be different. Everything is constantly changing based on the competition and openness of the blockchain.
At the moment, according to the community and node holders, the distributed commissions from transactions are not enough to cover the costs of maintaining the hosting and have some disadvantages:
Transaction fees do not cover server hosting costs
There is no motivation to attract new miners, of which there are a lot (all miners can be estimated around 500k-1M people) around the world
If the company is rewarded from the coins, it creates a bias towards centralization
Rewards from team coins are limited
All this is restricting the launch of an ample staking program
This is a proposal from the community that the team brings up for general discussion.
We emphasize that Credits blockchain is a decentralized environment based on blockchain principles. That is, absolutely any node that meets the necessary rules and laws of the network specified earlier can become a trusted node.
Based on the above principles, it is proposed that everyone together consider introducing additional rewards for trusted nodes which created a new block.
Please note that since this is a decentralized environment, all users and trusted owners will benefit from this. Everyone will benefit from mining.
We would like to propose the implementation of the following system of rewards for trusted nodes from the blockchain protocol. From the network system, all trusted nodes participating in the creation of the block will be rewarded with newly created coins, which will be divided into equal parts between all BFT participants by trusted nodes, which will average from 11 nodes and then will increase to 13 and 15 nodes.
After every 150 million blocks, which should take about four years, the reward halves. The total coin pool lasts for about 50 years and is 719,296,875 coins. Starting from 3 CS for all trusted nodes for 1 block. Approximately 75 million coins will be mined in the first year.
Calculation of remuneration
Halving on block
10 periods. About 50 years
We propose to introduce certain mechanisms that will limit the amount of performing node runners.
Only those who have a volume of CS coins of at least 50K can participate. Some of them can be collected on a wallet from delegated funds.
The reward will always be split between the trusted nodes in the round. The reward is always split between 11-15 and more nodes.
Real costs are required for the server and its maintenance. The equipment must be powerful and the Internet must be fast.
It is necessary to block the amount of CS stake on the account for at least 3 months. If CS are not blocked, then you cannot participate in mining. The lock cannot be removed before the expiration date.
Those who want to mine will need to block coins on accounts for the intervals from 3 to 12 months. The longer the block period is, the higher is the reward. The base reward for a 12 months block is 3 CS. When the block term is 3 months, compensation is 10% of the base rate, for 6 months - 30%, for 9 months - 50%. For 12 months - base 3 CS. It is impossible to unlock coins before the unlock date.
To limit the cap value of the stake for participation in receiving rewards (mining) to no more than 500K CS for a node with staking. To motivate an increase in the number of nodes (requires public discussion).
To limit the concentration of more frequent formation of a trusted node, it is proposed to discuss adding a factor of choosing a random selection of nodes from the number of large stacks (requires public discussion).
Despite the emission of new coins, all these factors should lead to the fact that the miner will be forced to spend real money on buying new coins and spending money on server hosting. Mining will not be free for node runners. Also, the reward will always be divided between the BFT trusted nodes by 11-15 trusted nodes (owners).
All this will lead to a significant increase in the motivation for holding coins.
Pools and staking program
At the moment, the blockchain implemented a mechanism for delegating its coins, so that another account can have a larger stake to participate in the consensus. In this case, there is no direct translation. This tool will provide an opportunity to develop pools. And pools will enable the holder, even with a small amount, to delegate them to another to receive a reward for keeping coins at the moment.
A new ample staking program for CS holders is structured.
The team is ready to use their coins to create a staking pool. Holders can join this pool and get a cut of the reward from what the pool earns.
The team will support them, advertise staking, run nodes, and transfer the coins earned.
To offer people to lock for a long period of 3-9-12 and more months
Pay them additional reward who are ready to lock for a longer period (limited)
This is a great opportunity to create a DeFi lending project for CS. Users lend their coins and get almost guaranteed rewards.
Launching a new mechanism
The Сredits blockchain is an open system owned by CS holders. The platform belongs to the coins' owners, and support of the proposal and decision on a new business initiative can be taken only by voting.
The approximate implementation period of the new mechanism is about 1-2 months. A testnet will take at least 1 month.
We will hold an open vote on the agenda of launching a new mining reward mechanism on October 15th.
The decision will be taken by the majority of CS holders for or against the proposal.
2 wallet addresses will be created for the poll, we will share them closer to the date. To participate you will need to send 0,01 CS to one of the addresses with your opinion (approve or disapprove).
Be with us, more announcements on this proposal to come out shortly.