A significant development is underway in Polkadot that promises to enhance the participation of Nomination Pool members in OpenGov, the on-chain governance system of Polkadot and Kusama. This change is poised to address a long-standing issue where funds staked in Nomination Pools were excluded from governance activities.
The Challenge: Transfer and Stake Strategy
Until now, when users joined a Nomination Pool, their funds were transferred from their individual accounts to a pooled account. This strategy, known as “Transfer and Stake“, effectively removed direct ownership of these funds from the users, although they retained claimable points reflecting their contributions. A significant consequence of this approach was that the funds in the pool became ineligible for governance participation, limiting the influence of a substantial portion of the community in on-chain decision-making.
The Solution: Delegate and Stake Strategy
To overcome this limitation, the Polkadot development community has introduced a new mechanism called the “Delegate and Stake” strategy. Unlike the previous method, this strategy allows funds to remain in the member’s account while delegating the right to stake these funds to the pool. This innovative approach not only preserves the user’s ownership of their funds but also enables their active participation in governance activities.
Current Status and Implementation
The Delegate and Stake strategy is currently live on Westend, Polkadot’s test network, where it has undergone rigorous testing. The final audit has identified a few minor issues, which are being addressed, with the expectation that the changes will be merged and deployed on Polkadot and Kusama in early August 2024.
Developer and User Guides
For developers, Polkadot has provided a comprehensive guide on how to interact with the new system. This includes runtime APIs for reading pool member balances, checking migration statuses, and applying pending slashes. These tools are essential for ensuring a smooth transition from the old system to the new Delegate and Stake strategy.
For users, the migration process is designed to be seamless, with most members not required to take any action. However, in cases where a user’s account also stakes directly or where their pool contribution is below the existential deposit, additional steps may be necessary to ensure successful migration. The Polkadot community has also provided detailed instructions for users to manually migrate their funds if needed, ensuring that all participants are adequately prepared for the transition.
Polkadot Lazy Slashes: A New Approach to Slashing
A noteworthy change in the new system is the introduction of “Lazy Slashes“. Previously, slashing events were handled eagerly, with all affected funds being slashed immediately. However, with the Polkadot Delegate and Stake strategy, funds are distributed across multiple accounts, making immediate slashing unfeasible. Instead, slashes are applied lazily, over multiple blocks, spreading the computational cost and allowing market bots to monitor and apply slashes as necessary.
Migration Process
The migration to the new system occurs in two stages: pool migration and individual member migration. During pool migration, the pool account is registered as a virtual staker, and all funds are moved to a new pot account, ProxyDelegator, which delegates back to the pool account. Subsequently, individual members can migrate their funds, transferring them with a hold to their own accounts.
Impact on Dual Stakers
A critical consideration in this migration is the impact on users who are both pool participants and direct stakers. Due to the overlapping of currency locks and holds, these users must withdraw all their directly staked funds before migrating their pool funds. This temporary limitation will be addressed in future updates, but for now, users are advised to use separate accounts for dual staking activities.
Conclusion
The introduction of the Delegate and Stake strategy marks a significant advancement in the Polkadot ecosystem’s commitment to decentralized governance. By enabling Nomination Pool members to participate in OpenGov, this change empowers a broader segment of the community, ensuring that governance decisions reflect the diverse voices within the network. As the deployment progresses, Polkadot continues to demonstrate its leadership in blockchain innovation, reinforcing its position as a leading platform for decentralized applications and governance.
- For more details please read the original blog post: Allowing Opengov participation for Nomination Pool members.
- There are more info available at the Polkadot support platform.
