coincodex.com
Key highlights:
- The community overwhelmingly voted to balance how mining rewards are distributed so that all miners can earn a fair paycheck, regardless of how fast their machines are.
- This will encourage miners to set up shop in more locations worldwide instead of just where internet speeds are quickest.
- Stakers are getting the chance to join node operators in keeping the network secure. So now there's a new plan to monitor how rewards affect prices like a central bank, and tweak levels accordingly.
The Zilliqa blockchain network has always placed community governance at the heart of its ethos. Four exciting new proposals are now open for voting on Zilliqa's governance portal, presenting opportunities to help shape the future of this leading blockchain project.
Attention all $gZIL holders!
There are 4 major proposals open for voting on the #Zilliqa governance portal!
Play your part and vote now to help bring exciting new features to the Zilliqa network - from hybrid consensus to major rewards changes.
Have your say on these new…
— Zilliqa (@zilliqa) September 27, 2023
Proposal 1- Balancing miner rewards to improve network efficiency
The first proposal, GP006, aims to address an imbalance in the network's sharding mechanism that is currently resulting in slowed block production times and unnecessary expenditures.
The problem
Zilliqa's network operates with four shards to process transactions. However, some of these shards are underutilized, causing delays in block creation and wasting resources for node operators.
The solution
GP006 proposes temporarily removing the unused shards until the launch of Zilliqa 2.0's X-Shards technology. This would speed up block production times and lower costs for node operators.
The proposal also seeks to balance miner rewards. Currently, miners who quickly co-sign proposed blocks earn substantially higher rewards. GP006 intends to reduce this disparity and enable all miners to earn fair rewards, regardless of the speed of their hardware.
Redistributing rewards in this way incentivizes miners to diversify the locations where they operate nodes, as they no longer need the fastest possible connectivity to maximize profits. This enhances decentralization.
The vote
An overwhelming 97.49% of gZIL holders voted in favor of implementing GP006. This shows a clear community mandate for improving efficiency and fairness in Zilliqa.
Proposal 2- Introducing a hybrid consensus mechanism
GP007 proposes an innovative hybrid consensus model that combines mining with staking.
The problem
As Zilliqa transitions to a Proof of Stake consensus in Zilliqa 2.0, there are concerns that mining could become too centralized among a handful of large pools.
The solution
By allowing Staked Seed Nodes (SSNs) to participate in the consensus process, GP007 aims to mitigate these centralization risks.
SSNs would form validator committees alongside mining nodes. Consensus would require agreement from both a 2/3 majority of nodes and 2/3 of the staked ZIL.
This hybrid approach blends the benefits of both Proof of Work and Proof of Stake, enhancing decentralization and security. It also smooths the transition to the upcoming pure PoS model in Zilliqa 2.0.
Rewards will be distributed based on the contributions SSNs make to consensus. This incentivizes their active participation in securing the network.
The vote
In a powerful display of community alignment, GP007 passed with unanimous 100% support. The community clearly agrees on the value of this proactive upgrade.
Proposal 3- Controlling inflation through active reward management
GP008 tackles the complex issue of balancing staking rewards, miner earnings, and ZIL inflation.
The problem
A recent Zilliqa upgrade caused blocks to be produced faster. While positive for scalability, this exponentially increased rewards and inflation.
The solution
GP008 establishes an active reward control mechanism. On a monthly basis, a governance committee will review block speeds, network conditions, and voted policies to determine responsible reward levels.
The goal is to limit inflation while keeping staker and miner earnings competitive. Any changes will be published transparently through the ZIP governance repository.
This allows inflation to be dynamically optimized in response to evolving network parameters.
The vote
With 93.16% approval, the community endorses the benefits of actively managing rewards over allowing uncontrolled inflation spikes.
Proposal 4- Fine-tuning the SSN staking contract
GP009 introduces small but meaningful improvements to the staking contract for SSNs.
The problems
There are currently some limitations around operating and rewarding SSNs:
- SSNs must delegate stakes, preventing "lone wolf" non-delegated nodes.
- There is no monitoring of SSN participation in consensus.
- Reward claims can completely drain a node's gas.
The solutions
GP009 proposes amendments including:
- Allowing permissionless non-delegating SSNs.
- Tracking SSN participation in consensus.
- Enable partial reward claims to conserve gas.
- Formalizing the 4% commission rate.
- These changes enhance flexibility, transparency, and operations for SSNs.
The vote
With unanimous 100% approval, the community stands fully behind optimizing the staking experience.
The bottom line: A community commitment to constant improvement
The overwhelming passage of these four proposals exemplifies the possibilities of decentralized governance. Zilliqa's open voting process empowers its community to directly shape the future of the network.
Whether addressing rewards, inflation, consensus models, or staking mechanisms, Zilliqa's voters have voiced a clear mandate in favor of enhancing security, efficiency, decentralization, and sustainability.
The coming implementation of these forward-looking upgrades will ensure Zilliqa remains at the cutting edge of the blockchain industry.
All the while, its native ZIL token has experienced the typical crypto volatility. After reaching an all-time high of $0.25 in May 2021, ZIL's price is currently around $0.017. With upgrades on the way, will these proposals help reverse its downward trend?