[Proposal] [Draft] Proportional Slashing

Imo, this is exactly the type of validator we want to incentivize. Validators should be investing into their hardware and security setups.

And by doing this, they are causing a massive negative externality harm to the network in the form of resilience decrease. This procedure is to incentivize them to not do that.

If they do this, it is beneficial to the network, as it is helping make the network more resilient.

Yeah, that is exactly my intention. The harm that centralization poses is when validators fault. And so we should harm the contributors to centralization when they fault.

Redelegate whenever they feel that the risk profiles of their validators have changed. Delegators are expected to be active participants in the network.

If somoene hacks your setup, then sure, they’d try to make both your keys fault.

Only if the slash is correlated. Then all correlated validators get the same slash. The standard default is that the small validator gets a smaller slash.

Well they should figure out how. Cause if not, they’re just burdening the network with additional signatures while not contributing to security by increasing the resilience of the network.

They probably shouldn’t run their entire setup on single cloud providers. And there’s many different infrastructure setups. Using different HSMs, data centers, KMS service, cloud providers (there’s many), servers, tendermint implementations, even OSs. I believe @mdyring was even planning on using BSD originally!

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My answer might sound a bit light on this one but I am a strong believer in free and transparent markets. And transparency is what DeFi brings.
One of the use cases of the slashing insurance is actually to have a risk score for each validator calculated out of the premiums that were bought for each particular validator. The higher the insurance premium price, the more risky the validator (from a slashing risk perspective). For a validator, one way of signaling is to make sure that the market (especially the risk buyers) are aware that they are doing everything needed to decorrelate and publish/show case what they implemented. This will push the market to price that particular validator risk at a lower price. The same way in traditional markets price is seen as taking into account all available informations, the premiums prices will be taking into account all available infos the validators make available.
All the data being also available to delegators in a transparent manner.

Isn’t slashing is already proportional (ie. 5%)? What is your goal by redistributing the slashing amount–is it actually to drive a change in the gini coefficient? Do you have a gini coefficient target in mind?

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