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How it works
Explanation of how the xDai Validator Pool functions

Disclosure

The original 20,000 STAKE requirement for xDai Validators is being reduced to 2,000 STAKE sometime in June. The Peerion STAKE Pool is structured for this upcoming change.

Pool Specs

Token: xDai STAKE Token (STAKE) Validator Requirement: 2,000 STAKE Pool Network: xDai Chain Pool Proportions: 1 STAKE = 1 Pool Share Pool Rewards: STAKE, xDai, ION Pool Reward Rate: 100% — 160% APY Reward Distribution: Proportional Minimum Stake: 20 STAKE Collateral: Non-custodial Peerion Commission: 10% of rewards Operational Overhead: Subsidized By Peerion (Monthly server costs & maintenance time)

Pool Security

Layer 1 The xDai Chain — a Layer-2 stable coin side chain, based on the DAI Token and backed by a decentralized network of validators.
Layer 2 The xDai Validator STAKE Pool is governed by a DAO which is secured and powered by DAOhaus Technology. DAOhaus is a decentralized governance platform which offers an easy-to-use interface for interacting with smart contracts across multiple blockchain networks.

Pool Summary

The Peerion xDai Chain Validator Pool is open to the public. The pool is operated by a Decentralized Autonomous Organization (DAO). The Pool DAO enables the public to pool STAKE in order to co-own an xDai Chain Validator, vote on asset allocation, and collect proportional rewards. By staking any amount of STAKE in the pool, a 1:1 STAKE Pool Share is received. Pool Shares gives the holder proportional voting weight and reward split.
All Validator rewards go directly into the Validator STAKE Pool Vault. While staked in the Pool, Shareholders also farm Peerion’s ION Tokens. Shareholders can stake the farmed ION back into the Peerion DAO for governance power over the entire ecosystem and additional reward claim. Learn more
The xDai Validator STAKE Pool has exposure to three types of rewards: 1. STAKE rewards for sealing blocks (15% APY) 2. xDai transaction fees (based on volume) 3. ION farming rewards (100%+ APY) Learn more

The Process

1. When STAKE is staked in the Peerion xDai Validator STAKE Pool, a 1:1 STAKE Pool Share is received, and the STAKE is added to the Pool Vault.
2. Once Pool Shares are received, ION Tokens begin to be farmed automatically, and continue until Shares are burned.
3. Until the required 2,000 STAKE has been pooled in the Peerion xDai Validator STAKE Pool, the underlying STAKE is non-custodial and can be withdrawn at any time by burning Shares.
4. Once 2,000 STAKE have been successfully pooled, the STAKE Pool DAO will stake the STAKE in the xDai Chain, spin up a node and connect to the validator network.
5. The overhead costs and maintenance time will be subsidized by Peerion.
6. The rewards collected from validator operations will go directly into the xDai Validator STAKE Pool Vault.

Pool Details

A. All transactions, stakes, rewards, and votes can be audited on chain.
B. Besides proportional reward redemption, nothing can be removed from the DAO Vault without consensus approval by the DAO.
C. All STAKE that has been pooled in the xDai Validator STAKE Pool when the xDai Validator is deployed, will be locked. Although, a signal can be made by any member to request a withdrawal as long as the amount to be withdrawn does not bring the validator lower than the required minimum amount of STAKE. If the requested withdrawal will bring the Validator lower than the required amount, a buy-out can be held (the buy-out process is explained below).
D. Since the xDai Validators are chosen based on the amount staked plus a random number, the Peerion STAKE Pool will remain open even after the 2,000 STAKE requirement has been met. Doing so will ensure that the Peerion STAKE Pool continues to grow and is always chosen as a validator.
E. It is a 90/10 reward split for the pools hosted by Peerion. 90% going to all the members who stake and 10% going to Peerion as incentive to maintain the validator and pay for the overhead costs (servers, transfers, swaps etc.) and maintenance time.
F. All members maintain ownership of the full amount of STAKE originally staked in the pool. Peerion only receives 10% of the rewards and voting rights.
G. All rewards collected by the co-owned validator will be deposited into the DAO vault. Reward allocation is then decided by the DAO.
These allocations can include:
    Proportional airdrops
    Liquidity initiatives
    Member buyouts

Buy-outs

Buy-out Process A buy-out includes the initial STAKE that was added into the Pool by the Shareholder when they joined, and a proportional reward claim to anything in the xDai Validator STAKE Pool Vault. There are 4 steps to the buy-out process and a mechanism in place to handle it effectively.
Step 1. A Shareholder creates a buy-out request signal
Step 2. The other Validator Pool Shareholders approve the buy-out request
Step 3. The buy-out amount is sent to the requesting Shareholder
Step 4. The requesting Shareholder then burns their Shares and receives their proportion of the Pool Vault rewards as they exit.
The buy-out amount can either be saved up by the DAO or be handled via a public swap (a new member joins to handle the buy-out).

Why Join The Peerion STAKE Pool?

You may be wondering why you should co-own a Peerion xDai Validator instead of just delegating your STAKE.
When you decide to co-own an xDai Validator, you not only are guaranteeing yourself a larger reward share in the future*, you are also earning xDai transaction fees, which normal delegators do not, and helping to secure the xDai Chain by further decentralizing the Validator Network. The more validators running on xDai, the more secure it becomes, which in turn invites more liquidity and overall value onto the network, creating a positive feedback loop for all.
*The actual Validator owner maintains a minimum of 30% of the rewards in the native delegation system built-in on Blockscout. That means if a native delegation pool exceeds 70% STAKE proportion in respect to the Validator owner, the Validator owner still keeps 30% of the rewards. And since the algorithm works by favoring Validators with higher quantities of STAKE, it makes sense that both Validators and delegators would want more STAKE delegated to ensure a higher probability of being chosen.
With the Peerion xDai Validator STAKE Pool, delegators instead become co-owners and reap all the benefits of being a validator owner, while actually needing less STAKE than it normally takes to become just a delegator.

Conclusion

By co-owning an xDai Validator you are helping to further secure and decentralize the xDai Chain and guaranteeing yourself a larger portion of the rewards now and in the future.
With the high threshold of 2,000 STAKE to become an xDai Validator, it may be difficult for one to achieve alone. Peerion’s xDai Validator STAKE Pool offers an easy entry point with a minimum contribution of only 20 STAKE. Peerion maintains the server that the validator runs on and subsidizes all overhead costs.

Join Now

Join the xDai Validator STAKE Pool https://peerion.io/pools/stake/

Learn About Peerion

Learn more about Peerion https://peerion.io/dao/
Last modified 2mo ago