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Version: 1.0.0

Staking

ZIGChain Staking is a decentralized process that enables users to enhance the network’s security and governance by delegating their ZIG tokens to validators. In return, participants earn rewards for their contributions.

ZIGChain utilizes the Tendermint Byzantine Fault Tolerance (BFT) consensus mechanism to secure its blockchain, ensuring robust and efficient consensus. Staking is a critical component of the ZIGChain ecosystem, driving its security, decentralization, and long-term resilience.

Key Components of Staking on ZIGChain​

Staking on ZIGChain revolves around two key participants

Validators​

Validators are node operators who:

  • Validate transactions, create new blocks, and secure the network
  • Maintain secure, highly available infrastructure
  • Earn rewards from transaction fees and block rewards
  • Are selected based on total delegated ZIG tokens (self-staked + delegators)

Delegators​

Delegators are ZIG holders who:

  • Participate in network security without operating validator infrastructure
  • Contribute to decentralization by delegating tokens to validators
  • Earn a portion of block rewards and transaction fees
  • Carefully select validators based on performance and reputation
  • Share risks, including potential slashing penalties

How Staking Works on ZIGChain​

Staking on ZIGChain follows these steps:

  1. Select a Validator:

    • Choose from available validators to delegate your ZIG tokens
    • Validators are ranked based on their performance, commission rates, and other factors
    • You can distribute your tokens across multiple validators to diversify your stake

  2. Delegate ZIG Tokens:

    • Delegate your ZIG tokens to the selected validator using the ZIGChain CLI or a wallet interface
    • Select the amount of ZIG tokens you wish to delegate to your chosen validator(s)

  3. Earn Rewards:

    • Earn staking rewards based on your delegated amount
    • Rewards are distributed automatically by the network

  4. Unstake:

    • Delegators can unstake (undelegate) ZIG tokens to withdraw them from the staking pool
    • A 21-day waiting period (unbonding) applies to all unstaking requests for network security
    • ZIG tokens become available for withdrawal after this period

Security Measures: Slashing and Penalties​

While staking on ZIGChain is rewarding, it also comes with inherent risks due to slashing mechanisms. Slashing is a penalty enforced on validators (and indirectly their delegators) for misconduct or negligence. This mechanism ensures that validators remain accountable and uphold the network’s integrity.

Types of Slashing Events

  • Double Signing: If a validator signs two conflicting blocks at the same height, they incur a severe penalty. This type of violation is considered highly detrimental to network integrity, and the associated penalty slash of 5% on staked tokens and lead to the validator’s removal from the active set.
  • Downtime: Validators must maintain high uptime. If a validator goes offline for an extended period, they incur a slashing penalty (0.01%). This penalty is intended as a minor deterrent, encouraging validators to maintain high uptime without severely impacting their stake.

Become a Validator or Delegator on ZIGChain​

Dive deeper into ZIGChain staking with this resource:

Delegators FAQ: Answers to common questions from delegators about how staking works, rewards, and managing their stake.