Delegate and rewards

You do not need to run a node to secure the chain. Delegating puts your L2P behind a validator: it counts towards that validator's stake, and you take a share of what it earns.

How delegating works

You send L2P to the stake hub, naming the validator you want to back. In return you hold stake credit, which represents your share of that validator's pool. Rewards are added to the pool, so your share grows without you claiming anything.

Delegated stake is at risk. If the validator you back gets slashed, the pool shrinks and so does your share. Pick validators the way you would pick a business partner, not the way you would pick a lottery ticket.

Undelegating

Undelegating is not instant. Your stake enters an unbond period first, and only after it expires can you claim the coins back. The length is the unbondPeriod parameter, and it exists so that a validator cannot misbehave and let its backers run before the slash lands.

You can also redelegate straight to another validator without waiting, at the cost of the redelegateFeeRate.

What to look at before delegating

• Commission. What the validator keeps of your rewards.
• Self delegation. How much of their own money they have at risk. A validator with nothing of their own to lose is asking you to carry all the risk.
• Uptime. Missed blocks are missed rewards, and enough of them are a slash.
• Elected or not. Stake behind a validator that is not in the elected set earns nothing.

All four are shown per validator at validators.l2protocol.com.

Voting weight

Delegated L2P also carries governance weight, measured at the snapshot block of each proposal. Staking your coins does not take you out of the conversation about where the chain goes next.