Since the launch of open staking, we’ve received lots of feedback and concerns around the undelegation and the associated locking period of 7 epochs. There are mainly two scenarios which causes friction to the staking market and bad experience:
For validators who got unelected, their delegators will have to wait for the 7 epoch locking period to withdraw their token and delegate to other validators. This causes huge friction of the delegation and put small validators in disadvantage because of the huge risk of being unelected.
For validators who decided to stop validating and turn themselves inactive, their delegators will take the hit of the 7 epoch locking period before their token can be delegated to other validators. This caused terrible delegator experience too.
Proposal: To improve the user experience of our stakers and create a more liquid staking market, We are proposing to reduce the locking period to be from the moment of undelegation until the end of the current epoch. With this change, any undelegated tokens will be unlocked at the end of the epoch when the Undelegate transaction is submitted. This also means for the delegators who want to change validators, they can do the redelegation as soon as in the second epoch after undelegation.
The proposal is mostly based on the following reasoning:
- At current stage of the mainnet, the risk of double sign attack is very minimal since Harmony is still the main controller of the network.
- Most basic double-sign behavior will be detected immediately and the slashing will be applied very soon and mostly within the same epoch. So locking the token throughout the current epoch is long enough to get normal double signers punished.
- Our consensus requires at least 2/3 of the voting power and it’s extremely hard for malicious attackers to control 2/3 of the voting power, conduct long-range attack and cause double-spending, compared to other blockchain requiring 1/2 of the voting power.
- The locking time create huge friction in the market which prevents tokens to move around validators and hindering new delegations to enter the system. This is causing more harm to the overall health of the network
Compared to the minimal risk of double signing and the high cost of not getting enough tokens staked. It’s reasonable to reduce the locking time at current stage of the mainnet. It will help better boost the staking percentage which strengthens the network security and will promote a happier and healthier staking community dynamics.
Let us know what’s your opinion on this. If there is no major objection to this proposal, we plan to roll out the change as soon as early next week (May 25 - May 29) to reduce further user impact.