📢 UPDATED Announcement on minPoolCost Parameters - Nov 23 📢
Long post ahead so maybe grab a ☕️ or 🍵
After having spent considerable time analysing pool operating costs as well as pool resources and other factors we've decided to return pool fees to the previous levels being 2%/₳340 for each pool, for the time being at least.
We believe the Cardano ecosystem as a whole is best served by properly incentivizing Stakepool Operators (SPOs) to run a professional and dedicated operation that reliably serves the security and transaction processing needs of Cardano - this is the main function of staking after all. In the recent SPO vote a number of highly experienced SPOs, including myself, suggested that a minMargin (compulsory minimum margin) was a better option than minPoolCost (compulsory minimum cost per epoch). I believe that adding a minMargin, along with an increase of k to 1000, would not only help to make smaller stakepools more viable but would also prevent the 'race to the bottom' that would inevitably lead to a degradation of the network.
I believe reducing minPoolCost, in the current macroeconomic cryptocurrency environment, without having a minMargin in place risks degrading the network and for that reason I consider that the marginal increase in staking rewards from reducing PoolCost has more potential downside than upside for the network. I'm possibly not alone in this thinking - only 228 out of 3,104 stakepools have reduced their PoolCost to ₳170 including only 55 of the 500 largest pools.
We will revisit pool parameters again in future as circumstances change.
For the record, I believe that the following pool parameter options would be to the betterment of the network:
💎 minPoolCost reduced to ₳0
💎 minMargin introduced (in the range of 2.00-3.50%)
💎 k increased to 1000 ASAP (this would optimize the network for 1000 pools. Would reduce saturation levels down to around ₳35m and potentially spread stake across more pools)
If any of y'all have any thoughts on the best parameters for the above please do share.
Our mantras in the creation of Kiwipool have been "infrastructure, infrastructure, infrastructure", "decentralization through self-sufficiency", "geographic decentralization", "where possible, stay away from big tech entities such as Google, Amazon, Azure, etc" and "be honest, always". I've stayed true to these mantras but in doing so, we've invested significantly higher amounts into the operation than most stakepools with well over $30,000 on baremetal infrastructure here in NZ to go along with the tens of thousands $ spent on cloud infrastructure. We've matched our investment to our philosophies without compromise and we wish to continue to do so.
In addition to running Kiwipool on mainnet we also support Cardano in Preview, Pre-Production, SanchoNet, LegacyTestnet (deprecated), YoloNet (one time network / deprecated) Testnets. We started up in Mithril on day one and now run Mithril Signers on Preview, Pre-Production and Mainnet networks. We've been here with you since the ITN started way back in December 2019 and we're settled in and here for good. Thank you for sharing in this journey - y'all put the WE in Kiwi!
In terms of the future, we have plans in the pipeline to add an additional layer of failover protection that we hope will keep Kiwipool up and running in the event of a global adverse internet event - we've codenamed this the 'SHTF Project' and will be partnering with other pools to achieve a much higher level of redundancy than the average Cardano stakepool. I aim to have more news to report on this front by the first quarter of 2024.
As we come towards the end of yet another year I want to say a heartfelt thank you from me and my family to you and yours for being here. Much love to you all and may the future bring peace, good health, improved prosperity, love and harmony for us all.
🌍 Together, WE are 🥝𝘒𝘪𝘸𝘪𝘱𝘰𝘰𝘭 𝘚𝘵𝘢𝘬𝘪𝘯𝘨