(FP-3) Forta Delegated Staking

The Forta Governance Council is seeking community feedback and approval of this “FP-3” proposal relating to delegated staking. FP-3 proposes the following actions that are designed to further increase the security and reliability of the Forta network:

1. Delegated staking: modify the Forta staking smart contracts to add support for delegators to delegate stakes to node owners, and give node owners the ability to assign delegated stakes to individual nodes

2. Prioritized bot assignment: modify the Forta assignment algorithm so that it will prioritize scan nodes that have higher stakes

3. Modification to rewards: modify the scan node rewards distribution so that rewards will primarily be distributed based on the number of bots assigned and executed, and with rewards shared among node owners and delegators with node owners having the option to keep a commission percentage from the delegator rewards

4. Support in the Forta App: add support in the Forta App for scan node owners and delegators related to the new delegated staking options

The 4 items proposed in FP-3 are described in more detail below under the corresponding numbered heading. Voting on FP-3 will be determined by a majority approval vote of FORT token holders on Snapshot beginning on September 13th, 2022 and ending on Friday 16th, 2022 (exact times to be announced through official Forta channels).

1. Delegated staking

Add support in the Forta staking smart contracts for delegators to assign delegated stake to node owners, and allow node owners to distribute the delegated stakes to their nodes for increased security within the limits of the maximum stake allowed per node. The maximum stake allowed per node will be raised to 25,000 FORT and staking parameters may be adjusted further in the future based on community decisions with approval of the Forta Council. Node owners will be required to supply the minimum node stake themselves, and delegation will not be allowed on nodes for which the node owner has not supplied the minimum stake.

Node rewards will be shared among node owners and delegators according to the percentage of stake supplied. Node owners will be able to specify a commission percentage that they will keep from delegator rewards (see more in section 3 below). Changes in the commission will go through a timelock. Delegated stakes will be subject to slashing and will be subject to waiting periods for withdrawals, unless the node owner fails to maintain the minimum stake required on a node in which case delegators will not be required to wait for withdrawal.

All smart contract changes will undergo a thorough security audit and the upgrade of the smart contracts must ultimately be approved by the Forta Governance Council (via the multi-sig wallet which maintains upgrade privileges on the smart contracts).

2. Prioritized bot assignment

The Forta bot assignment algorithm will be modified so that scan nodes with higher stakes (more security) will receive new bot assignments before other scan nodes with equal or lower SLAs (assignment today favors nodes with higher SLAs and that will not change in this proposal). This should help ensure the highest level of security and reliability for the Forta network.

3. Modification to rewards

Scan node rewards will be modified so that they will be distributed to node owners proportionally based on the number of the bots assigned, while also still factoring in the SLA of the nodes. In order to incentivize extra capacity for new bots, additional rewards may be distributed to some number of nodes without bots assigned based on their SLA and the amount staked on the node.

Rewards to a node will be distributed proportionally to node owners and delegators via the smart contracts based on the percentage of stake each supplied. The node owners will have control to specify a commission percentage they will keep from the delegator rewards. Any changes that node owners make to the commission percentage will go through a timelock.

4. Support in the Forta App

In coordination with the above changes, the Forta App will be extended to allow:

• node owners to set the % commission they will keep from delegator rewards
• delegators to delegate and withdraw stakes
• track rewards for node owners and delegators
• node owners to manage stakes delegated to them

Vote “Yes” if you think the Forta community should approve FP-3.

Vote “No” if you think the Forta community should not approve FP-3.