Staking, unstaking and unjailing

Before staking, a node is a mere observer. After staking, the node becomes a validator, which means that it will be eligible for consensus and will earn rewards. Validators play a central role in the operation of the network.

Staking is the process by which the operator of the node sends a sum of 2.5 million ERD to be locked in a system SmartContract. Multiple nodes can be staked for at once, and their operator must lock 2.5 million ERD for each of the nodes. This sum acts as a collateral, and it will be released back to the node operator through the process of unstaking, with a final step called unbonding.

A validator node produces rewards, which are transferred to the node operator at their reward address of choice, decided upon during the staking process. The reward address may be changed after staking as well.

If a validator has poor performance, the network will jail it, which means that it will not be able to participate in consensus anymore, nor will it produce rewards. The node must be unjailed before it can resume its role as a validator.

The processes mentioned above (staking, unstaking, unbonding, changing the reward address and unjailing) are performed by interacting with the Staking SmartContract, integrated into the Elrond protocol.

Each such process requires a transaction to be sent to the Staking SmartContract. These transactions must contain all the required information, encoded properly, and must provide a high enough gas limit to allow for successful execution. These details are described in the following pages.

There are currently 2 supported methods of constructing and submitting these transactions to the Staking SmartContract:

  • Manually constructing the transaction, then submitting it to wallet.elrond.com;

  • Automatically constructing the transaction and submitting it using the erdpy command-line tool.

The following pages will describe both approaches in each specific case.