Increasing the staking fee on Gnosis Chain to 15% from 10%

The combination of the high technical requirements to run on Gnosis Chain and a low point in the economic cycle (which has a -ve effect on the GNO price and hence node operator revenue) have created unfavourable economics for running nodes on GC.

While it is the duty of the node operators to anticipate the changes in the economics of their business in advance, the issue at hand here is the need to urgently re-home a large number of validators without acting against the node operators’ will. In other words, we cannot force them to take on the keys that will lose them more money than before, but still need to allocate almost 10,000 keys to someone. This calls for a structural change in our product on Gnosis Chain.

We believe such structural change would be to increase the staking fee to 15% of the rewards.

The benefit of increasing the fee to 15% is that there is less contribution to further centralization because more operators can handle the financial requirements of supporting GC at this price point. The drawback, of course, is the higher fee that will be applied to stakers as a result of this change.

To put this into numbers, stakers will lose ca 0.6 percentage points of consensus-level rewards (annualised), earning 10.04% APR after the change (vs 10.66% APR now). We believe this is a tolerable reduction given the importance of keeping Gnosis Chain decentralized and the validator performance as solid as possible.

Proposal: increase staking fee on Gnosis Chain to 15% (from 10%).

Please vote Yes or No for this proposal.