Proof of Stake

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Overview

• Sybil resistance - Economic cost to create validators
• Consensus weighting - Votes weighted by stake
• Incentive alignment - Validators earn rewards for honest participation
• Economic security - Attacking the network requires controlling significant stake

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Stake Accounts and Vote Accounts

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Vote Accounts

• Tracks validator votes on blocks
• Counts vote credits earned
• Stores validator commission rate
• Records validator identity
• Accumulates commission from rewards

pub struct VoteState {
    pub node_pubkey: Pubkey,                 // Validator identity
    pub authorized_voter: Pubkey,            // Key authorized to vote
    pub authorized_withdrawer: Pubkey,       // Key authorized to withdraw
    pub commission: u8,                      // Commission percentage (0-100)
    pub votes: VecDeque<Lockout>,           // Recent votes
    pub root_slot: Option<Slot>,            // Last finalized slot
    pub credits: u64,                       // Lifetime vote credits earned
}

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Stake Accounts

• Hold lamports (SOL) to be staked
• Name a vote account to delegate to
• Track rewards earned
• Enforce warmup/cooldown periods
• Support lock-up for long-term commitments

pub struct StakeStateV2::Stake {
    pub delegation: Delegation,
    pub credits_observed: u64,
}

pub struct Delegation {
    pub voter_pubkey: Pubkey,        // Vote account being delegated to
    pub stake: u64,                  // Amount of stake (subject to warmup/cooldown)
    pub activation_epoch: Epoch,     // When stake was activated
    pub deactivation_epoch: Epoch,   // When stake was deactivated (or u64::MAX)
}

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Passive Delegation

• Stakers create stake accounts and delegate freely
• No interactive action from validator required
• Total stake is computed by summing all delegating stake accounts
• Validators only need to vote; stake weights are handled automatically

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Epochs and Slots

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Slots

• Duration: ~400 milliseconds
• One designated leader per slot
• Leader can produce one block per slot
• Sequential numbering from genesis

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Epochs

• Duration: 432,000 slots (~2 days on mainnet)
• Stake weights are recalculated at epoch boundaries
• Leader schedule is regenerated each epoch
• Rewards are distributed at epoch end
• Warmup/cooldown progresses at epoch boundaries

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Stake Warmup and Cooldown

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Warmup Process

1. Initial state - Stake is “activating” but not “effective”
2. Gradual activation - Each epoch, some portion becomes effective
3. Rate limiting - Network-wide warmup rate limits activation speed
4. Full activation - Eventually all stake becomes effective

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Warmup Example

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Cooldown Process

1. Deactivation initiated - Stake marked for deactivation
2. Gradual cooldown - Each epoch, some portion cools down
3. Rate limiting - Same rate as warmup (25% per epoch)
4. Full cooldown - Eventually all stake is withdrawable

• Stake continues to earn rewards
• Stake remains subject to potential slashing
• Cooled down stake can be withdrawn

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Earning Rewards

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Vote Credits

• 1 credit per vote that exceeds maximum lockout
• Credits earned when a vote becomes a root (finalized)
• Recorded in the vote account’s state
• Used to calculate rewards at epoch end

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Points System

points = vote_credits × stake

• Each validator’s stake earns points proportional to vote credits
• More stake = more points per credit
• More credits = more points per stake
• Points determine share of epoch inflation

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Reward Calculation

1. Sum points - Total all points earned across the network
2. Calculate point value - Divide epoch inflation by total points
3. Distribute rewards - Each stake earns points × point_value
4. Apply commission - Validator takes commission, rest to staker

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Commission

pub struct VoteInit {
    pub node_pubkey: Pubkey,
    pub authorized_voter: Pubkey,
    pub authorized_withdrawer: Pubkey,
    pub commission: u8,              // 0-100, percentage
}

• Commission goes to the vote account
• Remaining rewards go to the stake account
• Validators earn commission on all delegated stake

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Inflation and Rewards

• Initial inflation rate - 8% annually
• Disinflation rate - Decreases 15% per year
• Long-term rate - Approaches 1.5% annually
• Reward distribution - Portion of inflation goes to stakers and validators

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Delegation Lifecycle

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Creating a Stake Account

1. Create account with System Program
2. Transfer SOL to the account
3. Initialize stake state
4. Optionally set lock-up parameters

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Delegating Stake

pub struct DelegateStake {
    // Instruction data
}

1. Select validator - Choose vote account to delegate to
2. Delegate - Create delegation in stake account
3. Wait for warmup - Stake activates over epochs
4. Earn rewards - Receive proportional rewards

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Changing Delegation

1. Deactivate - Initiate cooldown period
2. Wait for cooldown - Stake deactivates over epochs
3. Redelegate - Delegate to new validator
4. Wait for warmup - Stake reactivates over epochs

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Withdrawing Stake

1. Deactivate stake
2. Wait for full cooldown
3. Withdraw inactive stake plus rewards
4. Only inactive lamports can be withdrawn

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Lock-up

pub struct Lockup {
    pub unix_timestamp: UnixTimestamp,  // Time-based lockup
    pub epoch: Epoch,                   // Epoch-based lockup
    pub custodian: Pubkey,              // Can sign to bypass lockup
}

• Withdrawing lamports before expiration
• Changing authorized staker/withdrawer
• Deactivating stake

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Stake Distribution

• Decentralization - Stake should spread across many validators
• Nakamoto coefficient - Minimum validators needed for 1/3 stake
• Superminority - Validators controlling >1/3 stake
• Anti-concentration - Mechanisms to prevent stake centralization

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Slashing (Planned)

• Equivocation - Voting for conflicting blocks
• Downtime - Excessive missed votes
• Other misbehavior - Protocol violations

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Stake-Weighted Operations

• Voting - Consensus votes weighted by stake
• Leader schedule - More stake = more leader slots
• Turbine fanout - Stake affects propagation tree
• QUIC QoS - Higher stake gets better bandwidth
• Gossip weights - Stake influences peer selection

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Next Steps

• Learn about consensus voting
• Understand cluster participation
• Explore validator operations