Developers Forum for XinFin XDC Network

Ritesh kakkad
Ritesh kakkad

Posted on

XDC Network Protocol Upgrade Proposal: Fully Proof-of-Stake (PoS) Network

Brief Background

Early in 2017, XDC Network Founders decided to create a scalable and open-source blockchain infrastructure (a smart contract-based platform) that solved major problems facing networks that relied upon the Proof of Work (PoW) consensus protocol.

Following extensive research and consultations with technology experts, the XDC Network went live on the 1st of June 2019. Immediately after launch, the XDC network helped cut transaction times from a few minutes to two seconds; reduce Gas fees from between $5-$30 to near-zero fees(less than one-millionth of an XDC for most transactions). And, minimize energy consumption by 99%--i.e. XDC mining consumes a mere 0.0000074TWh as compared to 71.12 (TWh) and 20.61 (TWh) needed to mine Bitcoin and Ethereum, respectively.

As well, the XDC network added a KYC layer for its validators, which enabled the identification of masternodes/validators. With this unique feature, the XDC network successfully handled queries from different regulators that had issues with identity and KYC-related compliance requirements.

As of 1st June 2022, the XDC Network completed three years on the Mainnet using XDPoS (XinFin’s Delegated Proof of Stake) consensus protocol.

Since then, there has been an explosion in the usage of the XDC Blockchain Network. A few major growth factors contributing to the surge were: XinFin’s approach to growing the network’s performance and technical specs after collecting opinions from community members; use cases that are based on real-world enterprise, and the network’s proactive approach to solving problems facing the evolving blockchain technology space. And with the XDC network’s smart contract capability and open-source nature, the Network is inherently programmable, and it has become by far the most popular platform for developers to build Decentralized Applications (dApps)

For more insights, here are some recent statistics on the network.

Validator Node or Masternode increased from 3 to 207 (that’s including Backup/Standby nodes). Each validator has to stake 10 Million XDC (i.e. the MIN_STAKE) to become a validator/masternode. On the XDC network,masternode/validators are capped at 5000 Validator Nodes (i.e. the MAX_REGISTERED_VALIDATORS = 5000).

The total value of XDC Coin staked on the network is roughly 2,070,801,888

The total number of blocks created on the XDC network is 47094840.

More than 9500 XRC20 tokens have been deployed.

Following extensive research and deliberations, the XDC team has found out that the XDC Chain is the most suitable chain for implementing various trade finance and retail use cases. Top on the list of retail use cases that can thrive on the XDC chain are projects on: data oracle, storage, NFT marketplaces, ISO 20022 compliant messaging standards, and decentralized exchange (DEX). Many of the real-world DeFi and TradeFinance initiatives have begun to provide real benefits to the XDC community.

As a part of continuous research and development, the XDC team is proposing the next upgrade and seeks opinions from the Public/Community to improve. Proposal to migrate from Delegated Proof of Stake (DPoS) to a Fully Proof of Stake (PoS) protocol

How does the PoS protocol work?

Under the PoS protocol, a consensus is attained by requiring users to stake a specific amount of their tokens before they can be selected to validate transaction blocks and get rewards for successfully doing so.

To elaborate…

With the PoS protocol, XDC coin owners will validate block transactions based on the amount of XDC the validator/ Masternode stakes. Note: block creators under PoS are called validators. And their role is to check transactions, verify activities, vote on outcomes, and maintain transaction records.

To "buy into" the position of becoming a block creator, validators need only to purchase the sufficient limit of XDC coins or tokens required to become a validator for a PoS blockchain. To the contrary, miners under Proof-of-Work (PoW) protocol have to invest in expensive equipment and incur heavy energy charges to power the mining rigs used to solve complex mathematical equations before they can validate transactions and get rewarded for their work.

What Blockchains are Currently using PoS?

Examples of blockchain networks that currently employ the PoS consensus protocol include XDC Network, Polkadot, Avalanche, and Cardano.

Under the PoS consensus mechanism. The next block validator/block writer on the network is randomly selected, with higher odds being assigned to nodes that have larger stake positions or holders that have staked a higher number of tokens and have held the tokens for a longer period.

Key benefits of Proof-of-Stake include:
Reducing the amount of computational work needed to verify blocks and transactions that keep the blockchain system and tokens secure. Slashing transaction costs are incurred when transactions take place. Simplifies the way blocks are verified via the machines of coin owners, thus boosting efficiency. To elaborate, coin owners offer their tokens as a guarantee of the legitimacy of any new transaction they add to the blockchain. These coin owners are called validators.

Currently, what’s XDC’s consensus mechanism?

To become a validator on the XDC network, validators currently need a 10 million XDC stake(i.e. that’s the MIN_STAKE on the network)

Note, other important Masternode parameters on the XDC network:

XDC network’s VALIDATOR_SET_SIZE is currently 108
The EPOCH size is 900
NOS_masternode = 108 AND TOTAL_REWARD = 86400000 XDC + very small Transaction fees
REWARDS_TRANSFER: Every next block of epoch
WITHDRAWAL_PERIOD: Set of Epoch (1 Epoch == 900 Blocks) for XDC Network.

The system uses verifiable random functions (VRFs) to randomly select 108 candidates. Blocks are validated by more than one validator, and when ⅔ (two-thirds) of the validators verify that the block is accurate (VALIDATOR_SET_SIZE × 2/3), it is finalized and closed. More elaborately, a validator will verify the transactions and add them to a shard block, which requires at least ⅔ (two-thirds) of the 108 validators to attest to. And, once shards are validated and a block created, two-thirds of the validators must agree that the transaction is valid, then the block is closed.

Note: In the event of no proposal and/or a timeout in a round (r − 1), nodes will send a "timeout" message for this round, and the leader of the round (r-1) will gather tH of them into a timeout certificate (TC), so that this round can be dropped from the blockchain.

As well, for each iteration of 900 blocks (called an epoch), a checkpoint block is created. The block---also known as the block signer--- implements the reward under the protocol,which implements reward works. Block signers count the number of signatures sent to the block signer smart contract during the epoch. Rewards are based on the number of signatures linked to a masternode in an epoch.

In the event that a masternode is demoted or intentionally resigns from the masternode, the candidate’s deposits (10 million XDC) are locked for 30 days and can be accessed thereafter.

You may be wondering, what’s the Safety Violation and Forensic monitoring feature (part of the Forensic Monitoring Update) employed by the XDC network?

Well, here’s the monitoring feature in detail…

In the unlikely event that the ratio of Byzantine nodes exceeds ⅓ (one-third), these nodes can collude and create a security violation — either a safety or liveness violation. However, they cannot achieve this without being held accountable and punished, thanks to the protocol’s design

When the adversary corrupts more than ⅓ (one-third) of the master nodes in the BFT committee of an epoch, the adversary can violate the safety and jeopardize the consensus by creating forks - such as two finalized blockchains. However, certain messages need to be signed and sent by the corrupt nodes to successfully jeopardize the consensus mechanism. But, the XDC system can detect the messages, gathering irrefutable evidence of a node or nodes’ misbehavior. Worth noting, messages between nodes are embedded into the blockchain and can be obtained by querying master nodes for forked blockchains. This property of XDPoS 2.0 enables XDC’s safety forensic feature, which can identify as many Byzantine master nodes as possible while obtaining proof from querying as few witnesses as possible.

As well, the process of identifying culpable Byzantine master nodes involves performing appropriate quorum intersections since two quorums of tH ≈ VALIDATOR_SET_SIZE × 2/3 master nodes intersect in at least VALIDATOR_SET_SIZE/3 master nodes. With this approach, the XDC network can identify as many Byzantine master nodes that may have colluded to violate the safety and jeopardize the consensus mechanism by creating forks.

For witnesses, two honest nodes that have access to one of the two conflicting blockchains, respectively, are sufficient as proof. Since non-master nodes also passively monitor the blockchain, they can also serve as witnesses. This implies that as long as there are at least two honest nodes on the XDC network and the adversary wants to create a safety violation for the two nodes, the XDC team can provide evidence of the violation. Once a master node is held culpable by the forensic protocol, the proof is forwarded to XDC Network’s governance committee, initiating appropriate penalty mechanisms. We suggest you read the entire 15-page paper detailing XDPoS 2.0, which describes things in detail.

XDC’s network employs slashing of smart contracts and burning up to 100% of XDC Staked by a validator.

On slashing, the XinFin network employs both off-chain and on-chain slashing mechanisms.

For on-chain slashing, validators that engage in equivocation---the process of signing-off two blocks with the same step---trigger the process. Particularly, when a validator node keys in the wrong KYC details, the contract includes a reportMalicious method. If more than 2/3 of the
validators agree on a reportMalicious, an on-chain slashing is executed. This process can burn up to 100% of a validator’s stake.

On the other hand, with off-chain slashing, detection of crafty characters involves a reportBenign functionality. Within a validator's contract is reportBenign, which only validators can call, pass a message, and a block number. Slashing is initiated when more than 2/3 of the Validators agree on the misconduct. Misconduct by validators might include: consistently propagating blocks late and validators being offline for more than 24 hours without notice. Off-chain slashing can be executed on a portion of the stake—say 5%.

Why is the PoS Update important?
Having worked with the delegated proof of stake (DPOS) protocol, the XDC team seeks to unlock significant benefits associated with the PoS protocol. These benefits are as follows:

Integrating the Game theory Element:

Game theory is a fundamental mechanism underlying blockchain technology. And, in PoS blockchains, validators and nominators make decisions rationally, trying to maximize their utilities under the stipulated set of rules, and other participants’ decisions and strategies.

For validators in PoS blockchains, key strategies include making decisions on their stake’s size, whether to run a single node or multiple nodes, etc. Nominators on the other hand have to make decisions like how much and which token to stake, which validators to nominate, etc. Payout to validators and nominators depends on each participant’s strategies and the rules guiding how validators are selected and how rewards are distributed.

That’s a classic example of game theory in blockchain.

So, how will the game theory element work with the XDC network?

Upon upgrading to PoS, all Validators/Master nodes on the XDC network will compete with each other to mine the next block and get the reward, therein. As well, to become validators, each masternode has to stake more XDC, and this step increases loyalty towards the network. This Game theory algorithm will help to increase competition, loyalty, and help to improve the network’s health, and boost decentralization. At the same time, slashing (using a function called reportMalicious) can lead to the burning of 100% of a validator’s XDC stake in case of malicious behaviors.

Noting that validators seek to maximize gains by making rational decisions and with the reward and penalty mechanism in place, malicious acts are highly unlikely. Thus, the game theory element introduced by the PoS upgrade will help improve the decentralized network.

Give Masternode holders the freedom to make decisions

With the upgrade to PoS, XDCs’ masternode holders will have the freedom to decide the staking value of XDC. To illustrate, a masternode holder receiving an annual reward of 800000 XDC for the minimum stake size may decide to stake more, exceeding the 10 million XDC mark as the network won't cap the limit at 10million XDC. This feature will help to improve the network's ability to adjust to changes in Demand or Supply of masternodes in various market situations.

And, will the upgrade change the rewards/stake?

Well, the current annual XDC reward of 86400000 XDC for 108 masternodes remains unchanged [Note: Assuming validators numbers limit to only 108, We have option to increase rewards (after community vote) if we decide to increase mastrnode count (upto) 150]. However, with the PoS upgrade, masternode holders will have the freedom to stake more tokens to increase their chances of participating in the block validation process.

Optimize Performance

Upgrading to PoS will help improve the effectiveness of the network’s Byzantine Fault Tolerance (BFT) mechanism since validators will make decisions that greatly improve their stake. Noting that selecting a validator depends on their stake and the randomness is selection, adopting PoS will help improve performance since selected validators can immediately confirm a transaction if they agree about a bloc’s transactions. As well, due to the randomness in selecting validators, any node can participate in block validation and can share the rewards therein. With lack of a variance in which nodes earn rewards, all masternodes in the PoS network feel motivated to participate actively in the validation process, avoiding network glitches cause by delays by validators.

On the other hand, upgrading to PoS and leveraging the BFT will help optimize XDC network’s smart contract functionality, improving its scalability. To elaborate, BFT mechanisms guarantee speed and consistency, since validators have to agree before a block is generated. This will ensure faster and consistent settlement finality, further reducing transaction settlement times and loads on the network. With reduced loads, the XDC network will cut energy consumption further, hence improve its scalability.

Increase the number of Masternodes /Validators

Currently, the stable network has 108 Masternode/Validators. With the upgrade, the network’s team proposes to increase the numbers to 150 Masternodes. However, this upgrade requires a hard fork the XDC network will require all validators to participate in the upgrade.

So, why doesn't the network propose more than 150 masternodes?

Well, XDPoS Network started with 18 masternode/validators and increased the number to 108 after various tests on performance, network stability, and scalability of real-time transactions. Thus, the XDC’s team is proposing to cap masternode numbers at 150 since they will be adequate for the network’s performance, stability, and scalability.

The XDC network values feedback and opinions from XDC community members and Masternode Holders. And, it will be great to get your views on the proposal to migrate from a Delegated Proof of Stake (DPoS) blockchain to a fully Proof of Stake (PoS) blockchain. Another proposal is to update the total masternode from 108 to 130-150 masternode.

Following, the community and masternode holder’s feedback, the XDC community will decide on an appropriate update/upgrade plan. We also welcome other feedback and comments on our developer's forum to keep the XDC network more decentralized and to get more use case adoption.

XDC Network tools and documents for reference :

Github Links: XinFin Github , XDC Foundation Github
Register on XDC.Dev for documented instructions and to discuss with developers on any issues.

Github Link for this update proposal at:

Discussion (25)

xinfiner profile image

The proposal would give much power to those with more XDC instead holding decentralisation. I suggest to create pool of 10 mil XDC nodes, so people having less than 10 mil XDC, they can stake in the pool. So I am NOT in favour of the proposal.

riteshkakkad profile image
Ritesh kakkad Author

At current consensus, we tested upto 145-150validators node only. since we are more focus to get more participate as validators and create more decentralization for the XDC Network. We welcome your suggestion to create more decentralization without adding more validators nodes?

lucas_chua_ebd1d8d9e09f30 profile image
Lucas Chua

I like the proposal. This can give an opportunity for more staking and increase in price for XDC. Small investors can get a chance to stake and earn as well

fredy profile image

Small investors Will never get a node, this Will allow for bigger whales to get the nodes and compete, but the average Joe with 10k ir 100k xdc won't be able to compete

riteshkakkad profile image
Ritesh kakkad Author

Thank you for your for your feedback. This is important point.

supersnips profile image

Just as general idea, how about this: the core 108 Masternodes are working same as now with same rewards, the rest 42 MN up to total of 150 is on pos basis with XDC delegation (so small XDC holders can delegate their XDC to a Masternode and earn proportionally the same rate as the Masternode, but the Masternode can choose to charge a rate from 0% up to 10% fees) . They can do this by just using and XDCpay/Metamask. This reminds me of razor networks delegation model. Just for reference here is how is looks there:

Once one of the previous core Masternodes resigns, the previuos core Masternode count then gets to 107 and the other MN/validator spots get to 43. etc… this keeps on each time a Masternode of the early supporters and backers which helped grow the network resigns. This way over time I think the now core Masternodes will get lesser and more validator spots with game theory design will work, where each MN competes for most contributions in the way of less fees, marketing etc…

riteshkakkad profile image
Ritesh kakkad Author

Thank you for your feedback, we look at this given proposal and delegate XDC looks much more achievable looking at current XDPoS consensus

slarror profile image

Like many have mentioned here, the main question is:

"What are the challenges you foresee with present mechanism that only PoS would resolve?"

In other words, is this change necessary? If not, then it seems to not be beneficial to switch to POS, especially when financial institutions and organizations such as the IMF have repeatedly reported on the flaws of POS already. Why break something that is not broken? With our placements i fail to see the reason behind the change from XDPOS to POS.

What will happen to the xdpos forensic upgrades? What about the ongoing products being built on our current system?

riteshkakkad profile image
Ritesh kakkad Author

PoS was only one proposed option to scale the network with more participation. Most of the community voice not in favour of PoS so we will consider another option after feedback.

About xdpos forensic upgrades, its as per the plan here is the progress link :

Feel free to provide your feedback.

fredy profile image

I like the proposal since It fixes XDPoS's flaw: the decentralization of the nodes is delegated by a centralized entity, now this seems unfair for current node holders and I still think a cap is needed to protect the Network from whales that might be willing to take on the Risk of getting the capital burned (which might be less likely to getting caught if they get a hold of a majority of the Network if I understood correctly).
In general I think the idea makes the Network safer if implemented correctly but it needs a revision.

riteshkakkad profile image
Ritesh kakkad Author

your feedback noted. please provide if you have any additional feedback to get more participate without burning more XDC as Rewards but at the same time we need more decentralization.

xdc_to_the_moon profile image
Labababaa Abababa

Hello, I have read the proposal and I am trying to understand the reason for the switch from DPoS to PoS.

Is the purpose of this proposal to bring in the central bank/institutional node investors? The average retail node will not be able to compete once the 10m staking limit is taken out.

A recent IMF paper discussing blockchain consensus mechanisms says “Because ownership directly correlates with the chances of being selected, PoS consensus mechanisms can theoretically create a community where richer individuals or entities are more likely to be selected. This means those participants are also more likely to be rewarded, fueling an environment where the rich get richer. This scenario can lead to those participants with smaller holdings exiting the network if they aren’t able to generate rewards. In effect, PoS consensus mechanisms could create conditions where the network isn’t inclusive, as certain members (that is, those with larger holdings) are more likely be favored over others, increasing the potential for centralization.”

If the reason for this proposal was to clear the way for institutional investors, this would be huge for the ecosystem and is the only reason that this proposal would be beneficial in the long run.

Regulations are coming, most/all
non-compliant consensus mechanisms will be regulated out of existence.

The IMF and BIS seem to speak more favourably about DPoS compared to PoS.

Unless this is a move to bring in big money investors, why is there a proposal to give up the compliant/preferred DPoS? It doesn’t seem like there’s anything wrong with DPoS.

So my three questions are:

  1. Is this proposal a way to make room for big money institutional investors(elite, central banks), who will be the only ones able to compete, to step in and reap the rewards? If true, this would be huge for the ecosystem and greatly benefit adoption, and seems to be the only potential benefit for this proposal.

  2. If it is not to bring in institutional investors, why is there suddenly a proposal to give up a system that’s compliant/preferred with the people who are making the regulations?

  3. Regulations have the potential to become the biggest of black swans. Co-Founder Ritesh Kakkad seemed to be unfamiliar with the IMF papers discussing DPoS that people were referencing on Twitter, and did not respond when provided the documents. Are the founders, co-founders, and development team familiar with the regulations and recommendations to remain compliant coming from the BIS, FATF, IMF and similar global regulatory bodies?

Thank you for reading, I hope to get some answers to my questions and some more clarity on this proposal.

riteshkakkad profile image
Ritesh kakkad Author

Answer to your Question1: Purpose of proposal to get more institutional and community participation. Many Institution like to become a masternode but right now they are unable to be a validators.

Answer to Question 2: Upgration is continues process and always required to get more adoption and participate from more validators, Right now Masternode numbers and growth fully restricted for new master node-holders. We wanted to make it more open frame-work so new members can participate with more contribution and become a validators. In short, this is more like Quote by Hazrat Inayat Khan: “Movement is life; stillness is death.”

Answer to Question 3: BIS, FAFT, AML and KYC etc comes whenever we speak to the regulators. But many countries came out with various rulebooks and proposed framework (very opposite to each other) so it’s also important to aligen with most of the countries and not stick to one specific country. ITFA, D2A2, all discussion related to compliance, AML, FAFT and regulation. Limited community members aware about XDC's founders are part of new digital negotiable instrument law initiative. XDC Network so far most regulators friendly network and we want to keep enhancing as per the revised rule books. Other important task is to see technical viability as well so this may need extensive communication and brainstorming with developer’s community as well. Also i asked to specific link as IMF came with many papers including CBDC, Risk with crypto trading, crypto risk to emerging counties, crypto mining and energy consumption, financial system risk etc.

Feel free to create any additional proposal to get more community participate and adoption.

rory_federico_ca0a2a45829 profile image
Rory Federico

Will there be pretesting determine the Byzantine fault system will in fact work properly with the expected number of nodes to be deployed? How much of an extra benefit will it provide over the current dPOS for XINFIN?

riteshkakkad profile image
Ritesh kakkad Author

apothem network extensive testing supported upto 148-150 master nodes without changes in performance like TPS, block propagation, block sync.

walterblueu profile image
Jon McBee • Edited on

Here is my feedback on the proposal, after having taken more time to read and digest it.

You simply cannot cast a vote on the current proposal because there is not enough explicit information in the proposal for you to be able to understand what you are voting for. The proposal should be broken up into, at a minimum, three separate proposals.

  • Change the number of validating masternodes from 108 to 130-150. This proposal should also speak to standby nodes; if they will continue to exist, how many of them there will be. Standby nodes are completely subsidized by the ecosystem dev fund, and this proposal should also go into the tokenomics of increasing the burn from that fund.

  • Change the staking requirements for all nodes by removing the max and min stake requirements. We are all aware that current staking requirements are 10M XDC for both validating and standby nodes. The existing proposal includes removing that requirement so that anyone can stake any amount. I believe the intent was for people with less than 10M XDC to be able to stake in a node, but I believe that without greatly increasing the number of standby nodes the removal of a minimum stake won't accomplish this goal. What removing staking requirements will do is cause node owners to compete with each other to earn their way into the validator pool so that they an earn the maximum reward. I don't think this is a bad thing for the network as it would encourage larger amounts of XDC to get locked up in the masternode smart contract.

That last statement is only true up to a point because eventually it becomes disadvantageous to lock up large amounts of XDC with a fixed 10% return. As far as I can tell the existing proposal retains the 10% of 10M XDC reward for validating nodes regardless of if they have staked 10M XDC or 100M XDC. Eventually an equilibrium would be found that maximizes the return on the staked XDC. That said, I do believe that existing validating node owners would end up getting mostly pushed out in favor of the entities who have access to larger amounts of XDC. I think that the proposal must be updated to state that validating nodes will earn 10% of 10M XDC regardless of stake (or not if the founders intended otherwise) so that we can know exactly what we are voting on.

I think that we need to understand the mechanism that node operators would use to approve consensus updates. I think a worst case scenario would be for exchanges, banks, or other large entities to take ownership of all validating masternodes and have complete control over what consensus updates can and cannot be pushed. It would be possible for those entities to work with their own protocol teams and compete against the network as we currently know it for protocol updates.

  • Change from XDPoS to Full PoS. There is no concrete technical information in the current proposal explaining why this needs to happen. I don't believe that this update should be coupled to the previous two above. I think that before casting a vote we need to understand why the founders are proposing this change, how this change fits with the XDPoS 2.0 work already underway, and how this change relates to the masternode updates.

That said, I believe that the founders main intent was to open staking up to people who don't have access to 10M+ XDC. I have gotten to know the founders through my work at the XDC Foundation and I truly believe that they always operate with the best interest of the network and network participants in mind.

With that goal in mind I propose that we replace proposals 1 and 2 above with the following:

  • Keep 108 validating masternodes that earn 10% of 10M XDC required minimum stake. Shift to 100 standby nodes who earn 8% of 10M XDC required minimum stake (we are currently at 99 standby nodes so that would leave one more available at 8% with required 10M XDC stake). As we currently have a maximum node pool of 300, 108 validating nodes + 100 standby nodes = 208 nodes, and 300 max node pool - 208 = 92 nodes that have been planned for. Those 92 nodes are built into the tokenomics of the ecosystem dev fund with a planned burn of 800,000 XDC * 92 nodes = 73,600,000 XDC per year. So let's play with that pool of 73,600,000 XDC and see if we can open it up as rewards for lower staking amounts.

What if instead of 92 more standby nodes with 10M XDC staked earning 8%, we changed it to 1,472 more nodes with a 100,000 XDC mimimum stake requirement, where each node earned 4%? That would work out to a monthly reward of 100,000 staked XDC * 0.04 = 4,000 XDC per year, or 333.333 XDC per month.

There is a problem with this proposal, and that problem is hosting costs for the node. At current prices the rewards would just cover the hosting costs (and that may be too ambitious of a statement). But we can take this general concept and tweak numbers to make it work. My goal is to make as many lower cost nodes available as possible.

This proposal wouldn't change the tokenomics at all, but would make many more nodes available to many more people.

I welcome feedback on these thoughts.

rory_federico_ca0a2a45829 profile image
Rory Federico

I like this idea of 1472 more nodes with a minimum of 100k XDC for staking. This goal is very achievable for a lot of interested people that would not have had the opportunity under the current plan.

riteshkakkad profile image
Ritesh kakkad Author

great feedback. Validators node tested upto 150nodes only (not sure for 1.5k+ nodes) but we can provide flexibility for standby/backup node.

walterblueu profile image
Jon McBee

It isn't clear to me if the XDC mined with block validation will still be share across the entire validator node pool or if the masternode selected to validate will now receive the entire reward.

If the proposal is going to reward the nodes who stake the most XDC more than the nodes who stake the minimum then won't this proposal centralize validation in favor of early investors who hold the most XDC?

mayaxdc profile image
Maya Biene


ryan_mcbride_1759097aafd3 profile image
Ryan Mcbride

It seems the XDC amount to be node holder will never go below 10m only up. So one is never safe if you hold node #130 with 22 million XDC does the door close forever and you are holder for life or can you be removed in time by a 25 million xdc holder.
Currently are we proposing node #5 and #205 each with 10 million xdc will be offered the same chance to compete for one of the 130 nodes, the highest "bid" shall we say wins right to the node and the door closes or not.
Is there a different set of rules for node 108 compared to node 109 as things stand regarding the changes
Is being node 130 any different to node 131 currently under the new proposals
What timeline frameworks are on the table , and will we be able to monitor and react to the number of XDC required.
It feels like an auction for the rich to potentially take a node from an OG

Does the price of XDC have any bearing on the timing of this update - asking holders to give up a node at 3 cent gets a different response than asking them to give up at $1+ timing seems a little off to me.
Does the network require this shift to POS to fulfill its short term potential in the trade finance space where we all see XDC as a favored use case.

Thank you.

slarror profile image


cryptozen369 profile image

Hi Ritesh,

1) What would be the adverse impact on the present MN holders if we go with Full PoS proposal?

2) Is it going to reduce the % of present MN staking rewards? Current MN holders have been with Xinfin through thick and thin and I hope this PoS proposal wouldn't impact their staking rewards and Validator Position?

3) Will the Full PoS option grant the highest holder more power, which probably other MN holders may not agree with?

4) What are the challenges you foresee with present mechanism that only PoS would resolve?

5) You mentioned about Hard Fork of the XDC chain if we going with PoS option, how would this impact to the MN holders who run it through IndSoft?


riteshkakkad profile image
Ritesh kakkad Author
  1. Possibility of competition to remain masternode and MN holder need to stake more XDC it might be the other way around as well.

  2. Rewards can be decide after additional communite vote.

  3. No. 108 (or upto 150) Node will have power to write transaction. so 1st 150 Masternode will have competition.

  4. Restriction of masternodes rest need to be backup nodes.

  5. Serivice provider will help to upgrade nodes.

deva_arasan_d8774ed5f7747 profile image
Deva Arasan