Astar and Shiden networks provide a unique way for developers to earn rewards by developing products that native token holders can decide to support.
The principle is simple - stakers lock their tokens to stake on a dApp, and if the dApp attracts enough support, it is rewarded in native currency, derived from the inflation. In turn stakers are rewarded for locking & staking their tokens.
The following chapters will provide an overview of the functionality and terminology with accompanying examples.
Eras are the basic time unit in dApp staking and their length is measured in the number of blocks.
Eras are not expected to last long, e.g. current production networks era length is roughly 1 day (7200 blocks). After an era ends, it's usually possible to claim rewards for it, if staker or dApp are eligible.
Periods are another time unit in dApp staking. They are expected to be more lengthy than eras. Each period is denoted by a number, e.g. 1, which increments each time a new period begins.
Each period consists of two subperiods:
Period beginning is marked by the
Voting subperiod, after which follows the
Stakes are only valid throughout a period. When new period starts, all stakes are reset to zero. Protocol dynamic prevents inactive projects having high stakes due to inertia of stakers while at the same time allows more visibility for dApps joining the protocol and equal chance in attracting stakers' attention.
Even though stakes are reset, locks (or freezes) of tokens remain.
Voting subperiod starts, all stakes are reset to zero.
Projects participating in dApp staking are expected to market themselves to (re)attract stakers.
Stakers must assess whether the project they want to stake on brings value to the ecosystem, and then
vote for it (or stake on it).
Casting a vote, or staking, during the
Voting subperiod makes the staker eligible for bonus rewards. so they are encouraged to participate during this time.
Voting subperiod length is expressed in standard era lengths, even though the entire voting subperiod is treated as a single voting era.
Voting subperiod lasts for 5 eras, and each era lasts for 100 blocks, total length of the
Voting subperiod will be 500 blocks BUT it will consume only a single numeric era:
- Block 1, Era 1 starts, Period 1 starts,
- Block 501, Era 2 starts, Period 1 continues,
Neither stakers nor dApps earn rewards during the
Voting subperiod; rewards are only generated for eras in the
Build&Earn subperiod. However, as mentioned before, it’s crucial for dApps to use this time to market themselves and attract stakers, and for stakers to assess which projects they want to support.
It is important to award projects which the staker believes will bring value to the network and possibly themselves. Voting on a poor project means that poor performance is rewarded, damaging the network instead of improving it.
Build&Earn subperiod consists of one or more eras.
Build&Earn subperiod lasts for 10 eras, and each era lasts for 100 blocks, these 10 eras would consume 1000 blocks in total.
After each era ends, eligible stakers and dApps can claim the rewards they earned.
Rewards are only claimable for the finished eras. E.g. if the era 3 is ongoing, staker can claim rewards for era 2 if they were eligible.
Staker is only eligible for rewards if they have been staking for the entire era. E.g. if staker stakes in era 2, they are only eligible for rewards from era 3, which can be claimed from era 4 onwards.
Build&Earn comes after the
Voting, it is still possible to stake during this period, and stakers are encouraged to do so
since this will increase the staker rewards they earn.
The only exemption is the final era of the
Build&Earn subperiod - it's not possible to stake then since the stake would be invalid anyhow (stake is only valid from the next era which would be in the next period when all stakes are reset to zero).
To continue the previous example where era length is 100 blocks, let's assume that
Build&Earn subperiod lasts for 10 eras:
- Block 1, Era 1 starts, Period 1 starts,
- Block 501, Era 2 starts, Period 1 continues,
- Block 601, Era 3 starts, Period 1 continues,
- Block 701, Era 4 starts, Period 1 continues,
- Block 1401, Era 11 starts, Period 1 continues,
Build&Earnsubperiod enters the final era
- Block 1501, Era 12 starts, Period 2 starts,
- Block 2001, Era 13 starts, Period 2 continues,
dApps & Smart Contracts
Projects, or dApps, must be registered into protocol to participate. Only a privileged origin can perform dApp registration. At the moment of writing this, dApps & projects can request to be registered via Astar's forum.
Once the dApp has been registered, stakers can stake on it immediately, and it can earn rewards from the era in which it was registered.
There is a limit of how many smart contracts can be registered at once. Once the limit is reached, any additional attempt to register a new contract will fail. This puts an upper bound on how many contracts the protocol can support.
Reward Beneficiary & Ownership
After a dApp has been registered, it is possible to modify reward beneficiary or even the owner of the dApp. The owner can perform reward delegation and can further transfer ownership.
This is useful if dApp owners want to deposit rewards and/or transfer ownership to a DAO or a multisig account.
dApp can be removed from the protocol by unregistering it. This is an action that can only be done by a privileged origin. Unregistration can be the result of bad performance, reorganization or any other reason which governance decides it's viable.
After a dApp has been unregistered, it's no longer eligible to receive rewards. Past rewards also become unavailable, if they haven't been claimed already.
In order for users to participate in dApp staking, the first step they need to take is lock (or freeze) some native currency. Reserved tokens cannot be locked, but tokens locked by another lock can be re-locked into dApp staking (double locked).
This is useful for vested tokens, which although cannot be transferred to another account, can still be used to participate in dApp staking.
Locked funds NEVER leave the staker's wallet - it's only not possible to use those funds for fee payment or for transfer.
In order to participate, user must have a
MinimumLockedAmount of native currency locked. This doesn't mean that they cannot lock less in a single call, but total locked amount must always be equal or greater than
E.g. if an account isn't participating in dApp staking and threshold is set to 10 ASTR, attempting to lock 9 ASTR will fail. However, if user already has 10 ASTR locked, they can safely lock an additional 1 ASTR, for **11 ASTR locked in total.
In case amount specified for locking is greater than what user has available, only what's available will be locked - it's not possible to lock more than what's available.
Once tokens have been locked, they can be used to stake immediately. Users should ensure to do so since locking doesn't bring any rewards, unless tokens are staked as well.
It's not possible to use the same account for dApp staking & as the collator candidate.
User can at any time decide to unlock their tokens. However, it's not possible to unlock tokens which are staked, so user has to unstake them first.
After unlock is successfully executed, the tokens aren't immediately unlocked, but instead must undergo the unlocking process. This process takes a predefined amount of blocks to finish. This is a well known & widely used mechanism to reduce selling pressure.
Once unlocking process has finished, user can claim their unlocked tokens into their free balance.
There is a limited number of
unlocking chunks a user can have at any point in time. If limit is reached, user must claim existing unlocked chunks, or wait for them to be unlocked before claiming them to free up space for new chunks. This mechanism exists simply to prevent users from creating unlimited amounts of chunks in storage.
In case unlocking some amount would take the user below the
MinimumLockedAmount, everything will be unlocked.
E.g. if minimum locked amount is set to 10 ASTR, user has 15 ASTR locked, and they decide tu unlock 6 ASTR, this would take them to 9 ASTR which is below threshold. As a result, all 15 ASTR will be unlocked.
In case users would like to re-lock the unlocking chunks back into the dApp staking protocol, they can easily do that, without having to wait for the unlocking process to finish.
Locked tokens, which aren't being used for staking, can be used to stake on a dApp. This translates to voting or nominating a dApp to receive rewards derived from the inflation. User can stake on multiple dApps if they want to.
The staked amount is only eligible for rewards from the next era - in other words, only the amount that has been staked for the entire era is eligible to receive rewards. E.g. if user had staked 15 ASTR in era 5 on a dApp, and decides to stake an additional 5 ASTR, the new total stake amount of 20 ASTR is only eligible for rewards from era 6. Assuming staker doesn't do additional changes, rewards for era 5 will be calculated for stake amount of 15 ASTR, while rewards for era 6 will be calculated for stake amount of 20 ASTR.
It is not possible to stake if there are unclaimed rewards from past eras. User must ensure to first claim their pending rewards, before staking. This is also beneficial to the users since it allows them to lock & stake the earned rewards as well.
User's stake on a contract must be equal or greater than the
MinimumStakeAmount. This is similar to the minimum lock amount, but this limit is per contract.
Although user can stake on multiple smart contracts, the amount is limited. To be more precise, amount of database entries that can exist per user is limited.
This should not be a problem in practice though.
The protocol keeps track of how much was staked by the user in the
Build&Earn subperiods. This is important for the bonus reward calculation.
It is not possible to stake on a dApp that has been unregistered. However, if dApp is unregistered after user has staked on it, user will keep earning rewards for the staked amount.
User can at any time decide to unstake staked tokens. There's no unstaking process associated with this action. However, unstaking some amount forfeits it from being included in the reward calculation for that era - this is why it's important to choose staked dApps carefully.
Unlike stake operation, which stakes from the next era, unstake will reduce the staked amount for the current and next era if stake exists.
Same as with stake operation, it's not possible to unstake anything until unclaimed rewards have been claimed. User must ensure to first claim all rewards, before attempting to unstake.
The amount unstaked will always first reduce the amount staked in the ongoing subperiod. E.g. if
Voting subperiod has stake of 100 ASTR, and
Build&Earn subperiod has stake of 50, calling unstake with amount of 70 ASTR during
Build&Earn subperiod will see
Build&Earn stake amount reduced to zero, while
Voting stake will be reduced to 80.
If unstake would reduce the staked amount below
MinimumStakeAmount, everything is unstaked.
Once period finishes, all stakes are reset back to zero. This means that no unstake operation is needed after period ends to unstake funds - it's done automatically.
Claiming Staker Rewards
Stakers can claim rewards for passed eras during which they were staked for the entire duration of the era. Even if multiple contracts were staked, claim reward call will claim rewards for all of them.
Only rewards for the finished eras can be claimed. It is possible to claim rewards for multiple eras using a single call. This can happen if staker hasn't claimed rewards in some time, and many eras have passed since then, accumulating pending rewards. There is a limit on how many rewards can a single call claim, so if a lot of rewards have accumulated, it's possible that multiple claim calls will be required to claim all of the pending rewards.
Rewards don't remain available forever, and if not claimed within some time period, they will be treated as expired. This will be a longer period, but will still exist.
Rewards are calculated using a simple formula:
Claiming Bonus Reward
If staker staked on a dApp during the
Voting subperiod, and didn't reduce their staked amount below what was staked at the end of the `Voting`` subperiod, this makes them eligible for the bonus reward.
E.g. if staker had staked 10 ASTR during the
Voting subperiod, once
Build&Earn subperiod starts, they can stake & unstake as much as they want as long as they don't reduce the
Voting subperiod stake below 10 ASTR.
It is ok to stake an additional 30 ASTR, and then unstake 5 ASTR, because such order of operations would leave the staker with 10 ASTR staked in the
Voting subperiod & 25 ASTR staked in the
However, if user was to stake an additional 30 ASTR in the
Build&Earn subperiod, but would unstake 31 ASTR, this would put the stake amount in
Build&Earn subperiod to zero, and reduce
Voting subperiod stake amount to 9 ASTR. This would mean user is no longer eligible for the bonus rewards.
Bonus rewards need to be claimed per contract, unlike staker rewards.
Bonus reward is calculated using a simple formula:
Main thing for developers to do is develop a good product & attract stakers to stake on them.
Claiming dApp Reward
If at the end of a
Build&Earn subperiod era dApp has high enough score (support) to enter a reward tier, it will get rewards assigned to it.
Rewards aren't paid out automatically but must be claimed instead, similar to staker & bonus rewards.
dApp reward is calculated based on the tier in which ended. All dApps that end up in one tier will get the exact same reward.
At the end of each
Build&Earn subperiod era, dApps are evaluated using a simple metric - total value staked on them.
Based on this metric, they are sorted, and assigned to tiers.
There is a predefined limited number of tiers, and each tier has a limited capacity of slots. Each tier also has a threshold which a dApp must satisfy in order to enter it.
There is a limited amount of slots for dApps which means dApps have to compete for them. The amount isn't static but is recalculated at the start of each period.
Since the purpose of dApp staking isn't for dApps to earn obscene amounts of rewards, but to provide support to operate and further develop existing dApp, number of slots is scaled with the value of ASTR expressed in USD.
At the beginning of each period, using the average ASTR price during the former period, new number of slots is calculated:
This approach means that as ASTR value increases, so does the number of slots for dApp staking, and vice-versa.
Once number of slots is calculated, it is divided up into slots per tier. The portions are statically configured, e.g. tier 1 gets 10% of the slots, tier 2 gets 25% of the slots, and so on.
Tier Threshold Entry
A dApp isn't entitled to a tier by just participating in the dApp Staking. It needs to attract sufficient support to even be eligible for entry into a tier.
E.g. a threshold to enter tier 1 might be set to 1,000,000 ASTR. Since number of slots is dynamic, so has to be the threshold to allow for more realistic competition. It's not fair to define the same threshold for entering a tier if there are 50 slots or 500 slots since the staked amount will be more diluted between various dApps.
The formula for adjusting tier entry threshold:
where is the change in the number of dApps, expressed as a percent. In case number has been reduced, the delta will be negative.
At the moment, there are two types of tier entry thresholds:
Dynamic- adjusts the threshold based on the aforementioned formula.
Fixed- defines a static, fixed threshold which doesn't adapt.
Dynamic threshold is used for higher tiers, and also defines the minimum amount to which the threshold can fall.
E.g. a threshold might define current value as 1,000,000 ASTR. Since this can be decreased if number of slots goes up,
it also defines a minimum amount the threshold can take, e.g. 500,000 ASTR.
Fixed threshold is used for the lowest tier, and defines a static value.
Better tiers bring bigger rewards, so dApps are encouraged to compete for higher tiers and attract staker's support. dApp reward pool is divided between tiers, e.g. tier 1 gets 40% of the total reward pool, and the assigned tier reward pool is further divided between the dApps in the pool.
This means that each dApp within a tier always gets the same amount of reward. Even if tier capacity hasn't been fully taken, rewards are paid out as if they were.
For example, if tier 1 has capacity for 10 dApps, and reward pool is 500 ASTR, it means that each dApp that ends up in this tier will earn 50 ASTR. Even if only 3 dApps manage to enter this tier, they will still earn each 50 ASTR. The rest, 350 ASTR in this case, won't be minted.
More On Tiers
If there are more dApps eligible for a tier than there is capacity, the dApps with the higher score get the advantage. dApps which missed out on a higher tier get priority for entry into the next lower tier (if there still is any).
In the case a dApp doesn't satisfy the entry threshold for any tier, even though there is still capacity, the dApp will simply be left out of tiers and won't earn any reward.
In a special and unlikely case that two or more dApps have the exact same score and satisfy tier entry threshold, but there isn't enough
leftover tier capacity to accommodate them all, this is considered undefined behavior. Some of the dApps will manage to enter the tier, while
others will be left out. There is no strict rule which defines this behavior - instead dApps are encouraged to ensure their tier entry by
having a larger stake than the other dApp(s). Technically, at the moment, the dApp with the lower
dApp Id will have the advantage over a dApp with
the larger Id but this can change in the future.
Unclaimed rewards aren't kept indefinitely in storage. Eventually, they expire. Stakers & developers should make sure they claim those rewards before this happens.
In case they don't, they will simply miss on the earnings.
However, this should not be a problem given how the system is designed. There is no longer stake&forget - users are expected to revisit dApp staking at least at the beginning of each new period to pick out old or new dApps on which to stake on. If they don't do that, they miss out on the bonus reward & won't earn any staker rewards.