There are reward and punishment systems in most Proof-of-Stake blockchains. Rewards are used to encourage good conduct. Validators are paid a percentage of their stake for both affirming and proposing blocks to the network.
On the other hand, cutting is a penalty that is applied to undesirable conduct, inaction, and dishonest validations.
This method is intended to deter harmful validator activity while also encouraging network participation, node security, and reliability.
Crypto slashing characteristics differ from protocol to protocol and are established within them. In many circumstances, if a validator does not act as expected, a predetermined percentage or a fixed quantity of the validator’s stake is lost.
Some methods even apply a total stake reduction or expel the validator from the group permanently or for the current epoch.
Some networks, like as Polkadot and ETH2, employ closely linked slashing to encourage safety and decentralization.
This indicates that the penalty increases in proportion to the number of total validators who engage in the wrongdoing at the same time.
Assume that ten out of a hundred validators are unavailable. The cutting penalty is lower per validator in this situation than if 25 out of 100 validators are offline.
Crypto slashing is triggered by two essential behaviors: downtime and double signing.
A validator’s absence from signing operations on a blockchain for a period of time is referred to as downtime. The expected uptime of a validator varies depending on the protocol.
Furthermore, not all protocols slash nodes that are unavailable for an extended period of time. This is due to the fact that downtime might occur for a variety of causes.
Two common causes of downtime are the node’s cloud infrastructure becoming offline and the node being out of sync with the chain.
Double signing, which occurs when a validator signs two blocks at the same time, is another action that activates this mechanism.
Many node operators create backup nodes that run concurrently with the primary nodes. They do this to maintain the network working 24 hours a day, seven days a week and to avoid downtime. However, this is also why there is a chance of duplicate signing.
Owing to the difficulty for a network to obtain consensus, several PoS systems punish validator behavior. The sanction for double signing differs for every protocol.
Those who partake in the network with a stake in it, such as validators and token holders, may lose their existing cash if it is implemented.
Crypto slashing is a PoS protocol tool for discouraging bad conduct and making validators more accountable.
They help to keep the network secure since a validator can use the same node to verify blocks on different chains or on the wrong chain without incurring penalties. Without slicing penalties, PoS systems are regarded less secure.
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