[APPROVED] Cosmos Hub & Neutron: Validator alignment

Hey folks, thanks for the thoughtful debates.

I take the points on big vals vs small vals but given that the primary objectives of this proposal are to 1) ensure infrastructure costs are funded and 2) increase alignment between operators and consumer chain, I’m not sure making very opinionated eligibility rules really serves these objectives. They also add significant execution complexity, which imo should be minimized.

I plan to submit the proposal on-chain this week around Wednesday.

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Please at least exclude CEX validators


Thanks for reconsidering this. I agree that this is the right approach for alignment of the operators of the system, ATOM stakers (via the Cosmos Hub), and consumer chains. We’re less than 1 year into the Replicated Security experiment and making sure everyone has the right amount of upside is important.

There’s even a scenario where this could replace the commissions validators charge on consumer chains, if it’s technically feasible to do so.

  1. Can we discuss an allocation for validators that have actively participated in the original testnets?
  2. Are you still intending to go through Neutron governance first or is that just to enable governance rights for the tokens?

Also any feedback on my original draft posted here would be welcome: [Draft] - Cosmos Hub <--> Neutron Validator alignment plan


Also seeing as I had intentions to work on this or a similar proposal as well i would be happy to be on the mulitisig and steward the correct execution.

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Commons Hub validator would be very dissapointed if something along these lines is not implemented.

If linear distribution is considered too complex, we expect excluding the top 20 at a minimum.


@Spaydh can you please comment on the last questions raised here by me and others?

why is ATOM paying for NTRN’s validator costs?

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Success of Neutron is success of the Hub. Making sure validators are properly compensated is big part of having alignment.

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That is false. Neutron could fail and ATOM still be successful. Why are ATOM users expected to pay for NTRN validator expenses for free?

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You realize they will be paid in NTRN. Sent by Neutron to the hub community pool

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So ATOM users should pay for NTRN validator expenses because they are paying in NTRN? NTRN does have its own CP with NTRN as well, doesn’t it?

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Validators voting to pay themselves out of community pool sets bad precedent, these funds should not be distributed to validators. it should be used to hold a superior stake in Neutrons governance. what stops more proposals from coming to distribute community funds to validators. There is already a lack of trust in community and this wont help with general public, if neutron is unprofitable to validators maybe these funds should be used to renegotiate.


Just wanted to add, I am a strong believer in validators increasing fees to operate. Due to the competitive nature of the set operators are willinh to run at a loss just to be part of it. This is the going rate due to free market and imo a good thing. If validator is unwilling to run at those margins there will be someone to fill their shoes. If enough validators decide not to run then commission will naturally increase. But we are not seeing that.

Tldr: validators are willing to run at a loss just to be part of the set and this is a good thing.

I hope most of the validators will abstain on this vote and let the delegators decide the outcome. We will abstain with our validtor because its obviously a conflict of interest.


The proposal has been approved. Transactions and smart-contracts to provide the validator incentives are being prepared.


With the Cosmos Community now directly funding validators, eliminating the previous separation between community funds and validator operations, there is a greater need for enhanced transparency. The community deserves a detailed financial statement showing the allocation of Neutron tokens to each Validator, along with their dollar value. This clarity is essential, considering our funds are now crucial in supporting Validator activities.

This shift also brings into sharp focus the credibility of our network’s decentralization. The recent proposition’s approval raises significant concerns about conflicts of interest and potentially undermines the integrity of the entire system.

It begs the question: Are we facing a scenario where regulatory scrutiny might pierce the veil of our claimed decentralization, uncovering undisclosed agreements and collusion that contravene our blockchain’s foundational principles? To address these concerns, Validators must be prepared for future audits, and we must reevaluate our governance models.

The lack of transparency and the emergence of these issues could invite scrutiny from regulatory authorities like the SEC or FTC. The perception of mismanagement or impropriety threatens to expose our ecosystem to external regulation, challenging our claims of decentralization.

This opaque handling of finances and emerging conflicts blatantly flirts with legal repercussions. The evident mismanagement and questionable dealings are practically red flags for regulatory bodies like the SEC or FTC.

Such recklessness not only undermines our network’s credibility but also risks dragging us into the quagmire of external regulation, blatantly contradicting our decentralization claims.


The token holders were always funding valdiators. Thats how it works from the start

Perhaps I am missing some information. Could you elaborate on the direct funding mechanism for validators from the community pool?

My understanding is that validators in the Cosmos network primarily earn in two distinct ways: through transaction fees and staking rewards, both of which constitute a decentralized compensation model.

Validators collect transaction fees for including transactions in the blocks they validate, serving as one of their main revenue streams. Additionally, staking rewards, generated by the network’s inflation, are distributed to validators (and their delegators) for their role in securing the network. These revenue streams are considered “arm’s length” transactions, therefore, reflecting the validators’ independent and separate contributions to network security and efficiency.

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@Spaydh The Cosmos Hub proposal 867 passed on January 23rd 2024, this is over one month ago, any updates about the implementation of this governance approved proposal?


Did you get any info on the implementation of this?