Staking Process: Actions & Rules

Staking Actions

Staking involves three core actions:

• Adding Stake: Stake becomes active immediately upon being added to an address.

• Removing Stake: The initial staker may remove stake at any time, making it inactive. However, it remains at risk of slashing until fully withdrawn.

• Withdrawing Stake: After removal, the stake must go through a cooldown period before it can be withdrawn. This prevents malicious actors from evading slashing by instantly withdrawing their stake.

The cooldown period is typically defined by a fixed number of blocks in the underlying staking smart contract.

Staking Stages

Staking in XYO Layer One moves through four stages:

• Staked – Tokens are active and earning rewards.

• Stake Removed – Tokens are made inactive and stop earning rewards, but remain at risk of slashing until withdrawal is possible.

• Withdrawal Ready – After a cooldown period (measured in blocks), tokens are unlocked and eligible for withdrawal. They are no longer at risk of slashing but are not yet back in your wallet.

• Withdrawn – Tokens are returned to your wallet.

The cooldown period between Stake Removed and Withdrawal Ready prevents malicious actors from avoiding slashing by immediately pulling tokens after bad behavior. The length of this period is defined by the staking smart contract.

Staking Rules

• Anyone May Stake: Any participant can stake, even without running a node. This opens access to a wider range of users and supports broader network security.

• In a Rewarding Event:

  • Node Staking: Rewards are determined by the node owner, who receives both the block reward and a portion of the Step Reward. These rewards tend to be higher than System Staking.

  • System Staking: System Stakers are not eligible for block rewards. Instead, they can earn participation-based Step Rewards.

More details on slashing mechanisms will be made available in future documentation.