Lunie is a non-custodial staking tool that allows users to safely store, manage and stake crypto assets in Proof of Stake (PoS) networks. We assume that because you have landed here you are interested in learning more about Proof of Stake and trying it out. We’re here to help!
TL;DR - Proof of Stake allows for individuals, groups and/or businesses to participate in the operation of a blockchain network. We will go over how you can get started with this as fast and securely as possible. For more background on the basics of staking please read our guide which can be found here: https://lunie.io/guides/what-is-staking/
While different Proof of Stake networks share a lot of similarities in philosophy, operationally they are all quite different. This guide will focus exclusively on the Akash protocol.
About The Akash Protocol
Akash is a decentralized cloud computing marketplace, focused on more efficient and low cost computing resources for Web 3.0. Their serverless computing platform is compatible with existing cloud providers and aims to offer an alternative to existing major corporations who provide a majority of computing resources worldwide. Akash leverages 85% of underutilized server capacity in 8.4 million data centers, and enables people using existing personal computer resources and organizations to buy and sell compute on an as-needed basis. The payment mechanism between buyers and sellers of computing power will be powered by the Akash blockchain in a distributed and decentralized manner using the Cosmos SDK.
Choosing a Validator
Voting power of an Akash protocol validator is a critical metric to consider when choosing where to delegate your AKT tokens. The voting power metric is representative of how much stake a validator has been allocated by token holders and thus determines how likely they are to be selected by the network to vote on and propose a new block. This is how validators earn rewards for themselves and on behalf of those who staked their tokens with them.
Additional Considerations When Picking A Validator
Note - Lunie is not a validator on any Proof of Stake blockchains - therefore we have no objective benefit to recommend one validator service over another - we simply offer the clearest indicators possible of what a validator’s performance and current status is and the rest of the judgement will fall on the user. As always, we are happy to field any questions you might have about this process and are open to feedback.
Slashing Risks - Staking on the Akash protocol comes with some risks of loss of funds. If a validator messes up by double signing, the validator and those who delegate to them will be slashed 5%. If a validator experiences significant downtime the slash will be less severe at .01%.
Lunie offers an easy to understand rewards estimate for each eligible validator on the network based off of a calculation of:
- The total annual validator rewards (voting power * annual provision - which is a variable defined in the protocol)
- Subtracting the validator’s commission from the annual calculation
- Assuming a 1 AKT token delegation which will receive a percentage of the available rewards
- Based on how many tokens are already delegated to that validator
These rewards figures do not represent the compounding effect of rolling earned rewards back into the existing staked balance over time.
This rewards estimate is only a rough idea of what a delegator can expect over the course of a year and is subject to change. Validators can adjust their commission rates, experience downtime or cause a slashing event to occur.
Managing Staking Rewards
As with other networks built using the Cosmos SDK, Akash protocol rewards must be claimed in order to be used or re-staked.
Assuming you have Akash staked with a validator and you want to un-stake them, the AKT will be subject to a mandatory 21-day lockup period enforced by the Akash protocol. This 21-day lockup period is built into the network to prevent long-range attacks. During this period, your account will not earn any rewards associated with staking those funds and they will not be transferable until the period is complete.
For example, if you have 100 AKT staked and you un-delegate 25 AKT, the 75 AKT still staked will continue to earn their rewards, while the 25 AKT will earn no rewards unless they are re-staked after the lock-up period.
However, token-holders can immediately change who they stake a portion or all of their stake to by re-staking directly to another validator, rather than un-staking, waiting for 21 days and then staking elsewhere.
Similar to the governance structure on Cosmos, Akash token holders with staked AKT are able to submit and vote on proposals through governance functionality provided in the Lunie interface. Currently there are 3 types of proposals within the AKT:
- Text Proposals - are for creating general purpose petitions which can query the rest of the community for an opinion on a subject or ask the core developers to take action.
- Parameter Proposals - are able to alter specific parameters within the protocol that go directly into effect if they pass.
- Software Upgrade Proposals - These are inherited from the Cosmos SDK specifications, however it is not something the Akash protocol has implemented or supports yet.
As always, if you have any questions about staking AKT or using Lunie, you can always reach our support staff via the Intercom chat link right on our website as well as sending us a message to firstname.lastname@example.org