Going to share my thoughts that I had put on Discord, which is that I think the current overall system makes staking really bias against/unfavorable towards delegators.
- To start, the effective cut % is not readily visible but that already has been covered and seemingly being addressed in other proposals.
- The 28-day unbonding period + 0.5% tax + ETH gas makes it very difficult and uneconomical for delegator mobility and active stake management (e.g. switching). Why does it matter?
- Here’s what I’ve constantly observed: indexers offering very low cut % to attract delegators, then flipping the switch and jacking up their cut % aka rug-pulling, leaving the delegator with no lossless way out–at best, they have to wait 5+ weeks just to breakeven and losing out on reward for that duration.
- In the worst case, this keeps happening to Bob, so Bob is now trapped in an never ending cycle of jumping from indexer to indexer, each doing the same thing, at breakeven, and thereby rendering his yield rate at 0%, never mind the headache.
- Yes, not having a minimum cooldown contributes to this problem, but even putting in a minimum cooldown of say 28 days isn’t a good solution. Delegators look for stable yield that can go unmanaged for months, potentially years. A minimum cd of say 28 days just means they can flip it from 0% to 100% in 28 days, and we’re back to square one. (Cyclic issue mitigated but not fully resolved.)
This makes the system really scam-y.
What I, and I think many fellow delegators, would want to see is a system that allows higher freedom of staking mobility without or with reduced penalty (long unbonding period & tax, gas is probably unavoidable.) We don’t need to restrict Indexers, but rather if free market is actually the goal, give Delegators the actual freedom to choose whomever whenever.