Staking - Nominating Nodes
To stake or nominate a node in the xx network, you will be required to first bond the coins you wish to stake. While bonded, these coins will not be transferable but may be used for staking and governance. Staking and governance are considered separate actions and both may be done simultaneously with the same locked coins. For example, suppose you have 1,000 xx coins staked, nominating several nodes. In that case, you may use those same xx coins to vote on referenda, elect council members, and propose treasury spending without unstaking the nodes.
When a user wishes to unbond all or some of their coins to transfer them, there is a 28-day cooldown period until the coins may be used. The coins will not earn interest during this period and will not be counted towards your active stake. A user may rebond the coins at any time during this period and begin using them for staking again. This period ensures that the coins are available for slashing if a prior offense is caught within the 28-day unbonding period.
Overview of Steps to Nominate Nodes
- Create and fund a controller wallet
- Bond the coins you wish to stake
- Choose up to 16 nodes to nominate (with each bonded account)
- Wait for the next election for your nomination to be applied
- Claim rewards (rewards will automatically be staked so that they earn interest)
If you know what you are doing and already know the wallet address of the node or nodes you would like to nominate, then you can skip the separate stashing process in step 2 and click on the Nominator button in the Account actions tab. If you have already created a stash, then you can click on the Nominate button and click or search for the nodes you would like to nominate.
Create and Fund a Controller Wallet
We recommend using at least two separate wallets when staking: a stash wallet and a controller wallet. However, using two accounts is not a requirement and if you understand the risk and would like to use the same wallet for both the stash and controller, then you can skip this step.
The stash wallet holds the coins you wish to stake. To protect this wallet and the coins in it, it is recommended that you limit access to it. To limit access, a separate controller wallet may be used to control how the coins are staked but does not have direct access to transfer the coins. With this approach, you can keep your stash wallet in secure cold storage while using a hot wallet to stake the coins.
The stash and controller wallet can be created like any other wallet, though it may not be wise to use a derived wallet as they share the same recovery phrase and the goal is to limit the use of the stash recovery phrase. [Insert Link to Wallet generation]
Once you have created a controller account, you will need to add enough coins to cover transaction fees.
Bond the Coins You Wish to Stake
Once you have your stash wallet and optional controller wallet, you need to bond the coins into the network. To do this, go to the Network → Staking section of the explorer and then click on the Account actions tab.
Click on the Stash button and choose your stash and controller wallet (it may be the same wallet) and the amount you wish to bond. Once you have confirmed everything, click Bond. You may need to enter the password for your stash wallet if you have not already clicked the unlock for 15 mins option.
Choose Up To 16 Nodes to Nominate
Once your stash is bonded, you are ready to stake nodes. This section will cover nominating other people’s nodes, but if you want to learn how to run a node, you can learn more here.
Keep in mind that each stash account can nominate up to 16 different nodes. If you want to nominate more than 16 nodes, then you will need to create another stash and controller account and split your coins between the stash accounts.
You will likely need to look at the available nodes and research to select the best nodes. The easiest place to do this is the Targets tab in the Network → Staking section of the explorer.
From here, you can see all the available nodes you can nominate. A detailed walkthrough of choosing the best nodes to stake is outside the scope of the wiki, but there are some things to consider when selecting the nodes that you want to nominate.
- Determine the node’s commission
The commission percentage is the amount of the rewards pool that the node takes off the top as compensation for running the node. The rest of the rewards are then split amongst the stakers of the node. A node with a 100% commission rate will take all of its rewards in an era, leaving no rewards for anyone who has nominated it. Likewise, a node with 0% commission will not take any additional compensation for running the node and all of its earnings will be split amongst its stakers.
- Verify how many people are already nominating a node
The rewards that a node earns are split evenly based on stake (after the commission is taken out). The more stake that a node has, the more people you will share your rewards with. Check the total stake column and take this into consideration.
Furthermore, the rewards from a node will only be paid to the top 256 nominators. This means if you nominate on a node, but 256 people are nominating more than you, then you will not receive any rewards from that node until you stake enough to be in the top 256. Check the nominators column and take this into consideration when choosing nodes. A red icon labeled Oversubscribed will appear next to all nodes that have more than 256 nominators.
- Check the node’s prior performance
If a node goes offline or misbehaves, it (and everyone staked on it) will earn fewer coins and, in rare cases, may actually lose coins. Click on the cmix id to check the cMix performance of the node. Once you’ve confirmed that the node has an acceptable Uptime and Round Success Rate, you can go back to the explorer and click on the Stats button for the validator to see how consistent the node has been.
In the Targets tab, each node will have a toggle box on the far right. As you look at the nodes, you can toggle the ones you like (up to 16). When you are ready to nominate, click on the Nominate selected button.
Wait For Next Election for Your Nomination to be Applied
When you nominate a node, your nomination does not become active immediately. Instead, it will be applied in the next node election, which occurs at the end of every era.
To see the status of your nominations, you can go to the Staking → Account actions tab, which will show you your bonded wallets along with information on whether there are active or waiting nominations on them.
To see when the next era begins, you can go to the Staking → Overview tab and the time to the next era will be shown in the upper right corner.
You may receive an xx coin payout at the end of every era in which you are an active nominator on an active validator. Your payouts do not go into your wallet automatically; they must be manually claimed by you or one of the other stakers on that payout’s node. When one of the stakers on a node claims the payout for an era, it is automatically claimed for all other stakers on the node. There is a deadline by which each payout must be claimed before it is lost.
To see any available payouts, go to the Staking → Payouts tab. From here, you can see the aggregate payouts available per bonded stash, as well as a list of all the individual payouts available to claim. You may claim each of these one-by-one by clicking on the Payout button on the right, or you can claim all of your payouts with the Payout all button at the top right. If you have been actively nominating for at least a day and you do not see any payouts, it is likely another staker already claimed the payout for you and the coins are already in your stash wallet. All payouts are automatically rebonded into the stash account that earned them.