I’d like to get a discussion going around 100% slashing and hear some varied points of view on the topic. We’ve mentioned a few times we’re kicking around the idea and it’s various implications, I thought I’d open it up here as well.
Here are some initial thoughts and considerations:
- This would be a mid- to long-term goal for the protocol
- Infractions leading to 100% slashing would be limited and well defined (e.g. equivocation, not for downtime)
- It may compel delegators to think about risk allocation and push for greater distribution of tokens across validators
- Validators may be able to attract larger delegations from splitting stakes across multiple nodes assuming strong operational firewalls between keys.
- By design it would likely lead to a high quality validator network
- It would necessarily advance work around slashing insurance. On the other hand - it might not be viable until we have a healthy slashing insurance marketplace (chicken <> egg?)
- Raise barrier to entry for new validator
- It might make certain classes of staking derivatives difficult or impossible.
- How would it impact exchange validation services?
So what do y’all think?