This aligns precisely with the recommendations we made in our analysis:
In our research on PSS economics, we examined the promising dynamics created by combining exclusion lists with a strict vote power cap: the-vote-power-cap
We’ve also analyzed and suggested a pathway for scaling Top-N public good consumers as revenue grows: top-n-analytic-trends
For Stride, which allocates 15% of its 500,000$ annualized revenue to the Hub (as well as a share of STRD inflation), we propose lowering the Top-N parameter to between 60% and 75%, equating to roughly 20-36 validators required to operate (while others can still opt-in voluntarily). Alongside this, a strict 5% vote power cap would ensure efficient allocation of the security budget among participants. Currently, profitability remains elusive for validators, but these adjustments present a more balanced approach to achieve potential future profitability as the chain’s revenue grows.
Conclusions:
In summary, we recommend lowering the Top-N parameter to 75% or below, combined with a vote power cap of 5%. These adjustments provide a more sustainable baseline while awaiting future revenue growth. As the revenue increases, more validators are expected to opt-in voluntarily and adjust their validator fee parameters to share more rewards with their delegators, by lowering their validator fee.
Thank you for reading,
Govmos.
