TL;DR
- Break down of how Meta Pool chooses validators for staking $NEAR
- The Nakamoto Coefficient: what it is and why it matters
- How Stake Wars is moving NEAR toward a more decentralized and secure future
Choosing Validators for Staking $NEAR
As many of our users know, Meta Pool select specific validators (~84 out of 104) from the NEAR network for staking $NEAR.
Meta Pool follows the NEAR Foundation strategy to spread the stake among the long tail of high-performance, low–commission, non-concentrated validators. Specifically in order to increase decentralization and censorship resistance for NEAR.
Meta Pool evaluates all validators. We do not have whitelists, and we publish the formula and code we use to compute the results that will be on-chain. Our ethos is to be totally transparent and open to all validators.
The Nakamoto Coefficient
As more and more L1s face constant attacks from malicious actors, it is more important now than ever to explore just how secure a blockchain really is.
The Nakamoto Coefficient is a key metric that helps determine the decentralization of a chain.
The Nakamoto Coefficient is essentially the number of nodes that would have to work together to stop the production of a certain chain. Explicitly, the coefficient tells us how many nodes need to be “captured” by a malicious actor to disrupt the chain.
At the present time, NEAR’s network current Nakamoto Coefficient is 7. This means that NEAR’s top 7 validators make up roughly 33% of the total delegated NEAR that is staked through the chain.
Therefore staking $NEAR with validators that are below NEAR’s top 7 thus increases the security of the chain.
For example, imagine if you have a chain with a total supply of 300k tokens, and two validators who split that total between themselves. Only 1 seat hacked and that chain then loses control of the network, and 150k tokens…
On the other hand, if the stake were to be spread to 3000 validators with 100 tokens each, a hacker would need to compromise 1500 of them to take 150k, and disrupt the chain.
How does Meta Pool Ensure Decentralization?
Meta Pool does not have its own suite of personalized validators. Nonetheless we are still very concerned and active about our impact on the Nakamoto Coefficient. Consequently on the overall decentralization of the NEAR network.
Meta Pool has four criteria, in line with our ethos of transparency and fairness, for selecting validators on the NEAR network:
Uptime > 95%
Fees < 10%
Making sure the validator doesn’t reduce the Nakamoto Coefficient
Have enough tokens to accomplish the seat price of NEAR Protocol
While we are beholden to the network of validators that exists on NEAR, we do our best to ensure that the validators we trust with our tokens are benefitting the NEAR ecosystem. Most importantly, we are committed to avoiding any negative effects on NEAR’s coefficient or decentralized security.
Stake Wars - Providing a Decentralized Future
Stake Wars episode III is playing a big role in NEAR’s decentralization, and as such is very important to Meta Pool. This installment of Stake Wars marks the beginning of NEAR’s shift from phase 0 to phase 1 of their unique decentralization tool – sharding.
Sharding is meant to help address concerns that might arise from our relatively low Nakamoto Coefficient. As sharding is implemented, we will be able to have chunk-only producers who validate transactions per shard rather than per block.
This move will increase security and further fragment the delegation between new validators onboarding through Stake Wars, which contributes to overall decentralization.
About Meta Pool & stNEAR
Meta Pool is the leading liquid staking solution for $NEAR and wNEAR token holders. With Meta Pool you earn NEAR staking rewards and maintain your liquidity to participate in DeFi protocols on NEAR and Aurora.
Users staking $NEAR and wNEAR with Meta Pool receive in exchange stNEAR (staked NEAR) tokens.
stNEAR simultaneously accrues staking rewards and unlocks users’ liquidity enabling them to participate in DeFi activities (e.g. lending, farming, borrowing) on NEAR and Aurora.
Stake $NEAR on Meta Pool
~11% APY
Get stNEAR
Yield-bearing token
Go DeFi on NEAR & Aurora
More APY and more rewards
Meta Pool also solves the problems associated with Proof-of-Stake networks staking: illiquidity, immovability and accessibility. Meta Pool also aims to distribute staking in multiple validators to improve censorship-resistance of the NEAR network.
With a TVL of ~9 Million $NEAR and growing, Meta Pool has become in just a few months a cornerstone element of the NEAR ecosystem. Meta Pool is making NEAR Protocol more decentralized and therefore more secure.
In February 2022 Meta Pool has been successfully audited by BlockSec, confirming the implementation of the highest security standards.
For more information visit https://metapool.app.
