[Proposal] Increasing rewards for secure node owners to 5 %


#21

+1
I must agree with @trololino here, think about it if secure node will not receive sufficient reward (and with 3000-5000 nodes thats the case)they will move to other more rewarding platform.
and we are missing the target of secure nodes.


#22

let’s not be naive ppl, if reward is 0 or close to it how many nodes do you think zencash will have?
i will definitely sell them all, no one will take loss for long time.


#23

A lot of people run nodes for other coins with no rewards.

I am not adverse to increasing the reward, but as others have said that it could be a double edged sword. If you increase the node reward, this may entice other people to come in and increase the number of nodes, driving down the reward again. You cant keep increasing the reward like this, it is not sustainable


#24

@amiklo

This thread shouldn’t be a place to complain about not being rewarded enough for running a secure node without offering any additional insight as to why and/or how the reward system should be improved to satisfy both the users and the network itself. It’s just like you said, if you don’t think you are being rewarded enough to run a secure node, then you can tear down your secure node and participate in another cryptocurrency network.

At this time, I think it would be nice to have someone from the ZenCash team respond directly to this thread with the pros and cons of the current reward system whilst comparing it to other proposals that have been mentioned (i.e, increase to 5%, dynamic adjusting scale, etc) so that secure node owners can be more informed about how and why the reward system was structured the way that it is now and if there are any serious discussions about modifying it. It would also be beneficial to compare the current secure node reward system with other cryptocurrencies that have successfully implemented masternodes (specifically DASH).

While I think mining is a huge part of what makes a cryptocurrency successful, I would also argue that decentralization and distribution is just as important (if not more). I would like to see more cryptocurrencies implement the concept of rewarding users for participating in the network as a node (even if the reward is minimal), so that there can be increased distribution and decentralization with every new user. Whether or not ZenCash will be this type of network is up to the the individuals in the ZenCash team.


#25

+1 for 5% but main problem is price. Zencash should cost min $100.


#26

It’s pure economics supply and demand, if does not compensate run a node, people will move to another crypto or masternode or just sell they tokens. and who believes and the team the development of the coin will stay and the reward will go up. just a increase by increase it’s not sustainable.


#27

0.25% for every increase of 500 nodes (up to 5%)

Great idea! +1


#28

" If you increase the node reward, this may entice other people to come in and increase the number of nodes"
My point is that the percentage of the reward should divided better inside the community not %85 to miners and %15 for the rest of the community, this is not proportional. let’s learn how to share the reward more evenly.
that is want i’m calling for. you don’t what to share it in a more fair way you will heart the community in the long run.
that is what i believe in. most of your community will be miners and not coin holders.
good luck to all of us.


#29

this is a “great” way to build a non democratic community(communistic style)
so basically you tell me if i don’t like it go look somewhere else and don’t complain or sit down quietly.
well guess what i care for Zencash not less then you do, so i will fight for what i believe in,
and that is the right for every community member that hold Zen to freely say what he got to say
without someone else telling him my way or the highway.
and for the reward share in a more equal way to community members.
not %85 to miners and %15 to the rest of the community members
without strong community you won’t have coin holders and therefor very few miners they can have all
the reward they want it will probably will not worth much

BTW
wasn’t this the all purpose of forking from zcash, to build a better and more fair community ?!


#30

@amiklo

If you or anyone in the ZenCash community are truly disgruntled by not being rewarded enough, you always have the option to not participate. That is all I am saying. I have thought about doing the same because of the very little reward of running a secure node, but I am not just in it for the reward. I decided that I am going to continue contributing so that I can benefit the ZenCash network in the long run, as long as I am not losing money. There are thousands of cryptocurrencies to participate, so I would recommend looking at others if you feel like your expectations have not been met. The main point of my response to you is to request that you offer real alternatives to the current 3.5% rather than just complaining about this not being enough of a reward. The percentages of the reward block are clearly defined in the white paper, so I am not sure how likely we are to change this without having someone from the core participate in this discussion.

Division of each PoW block reward and transaction fees between miners and other stakeholders:
(a) 88% to miners.
(b) 5% to one or more DAOs.
© 3.5% to Secure Node Operators.
(d) 3.5% to the Core Team.

By the way, I am in complete agreement with you that the reward ratio should be much closer for miners and nodes. I believe that the future of cryptocurrencies relies on the concept of decentralizing and distributing the network as far and wide as possible, and the best way to do that is to encourage as many people as possible to participate as a node by promising a reasonable compensation. The very successful DASH pays our 45% to their masternodes, which is what I would like to see more cryptocurrencies lean towards in the future.

Edit: It would also help if this post was moved into the proper [Proposal] category for more visibility.


#31

@revolve2evolve
Thank you for your reply.
whitepaper is a design paper it was written before Zen was burn(pre-production), and as so it should be review from time to time, and should be adjust and optimize according to Zencash Community needs to keep it up-to-date in order of building a solid platform.
that being said in order to keep Zencash platform incentive platform that will have good traction for both coin holders,
miners and coin stacking(master nodes owners) and in order to add real value to the coin so it will be here also in the next
5 years, we need to attract merchant and buyers to use the ZEN coin in order to do so
we need to have cash-back program that will offer %10 cash-back to buyers that will be offer by merchant that will accepts ZEN as a form of payment on their stores.
masternodes - we need to think on what is the golden number for masternodes, is it 10k or 5k or 1k im not sure
maybe 1k is enough for Zen needs im not sure but i do know, if you reward coin holders for masternodes you should give them fair share to me %3.5 is NOT fair share. I would like to see this share optimize upward. so i suggest to higher the number of minimum stacking to 129 zen per node and adjust the reward to %10, this way you keep the incentive for the all community miners and coin holders and not only one side, we got to keep this balance else in long run you will have only miners or only coin holders.
to sum it up:
70% Miners
10% Cashback program
10% Masternodes(coin stacking)
5% Employees(on payroll)
5% DAOs (bug bounty, marketing, hackathons)


#32

my suggestion - change white paper asap:

(a) 70% to miners.
(b) 5% to one or more DAOs.
© 15% to Secure Node Operators.
(d) 3.5% to the Core Team.
(e) 6,5% Marketing

For marketing budget my suggestion:

  • Build small marketing team (1-3 persons) to manage everything (these people need to be smart and have some experience, knowlege and ideas/vision to make good decisions each month about marketing and what should be done)
  • Outsourcing - example PR (min 1 PR/month - send to most popular newspapers, portals, blogs from whole world) , SEO for main page, profiles, videos (so all keywords in google like privacy coin, the best coin etc - zencash have to be in top10)…, Video Marketing etc)
  • Marketing proposals (help from people inerested in zencash so it is win-win situation and work should be effective then… People who have zencash and are willing to work and help in marketing are interested in increasing the value of this coin. Need have budget for people from whole world especially for social media marketing work - sharing content, send questions, answers, tips, share news, share pbc signal about zencash from Palm Beach Confidential etc on popular pages, fb groups, reddit etc)
  • Hire freelancers for additional work (example funny images, comparisons, banners, videos, help with sharing etc)
  • Sponsored articles, reviews, “news” on popular portals, blogs, youtube channels

More for secure nodes = more stable network and value (price) for zencash because less dumps (dumps are mainly because of miners… and i am miner :slight_smile: )

The most important is to add % for marketing because not is not effective and it is the most important thing to make zencash popular… Will be easier to have more exchanges, easier to make profit from mining and from secure nodes because price will be higher and higher (and each month % will be the same but because of rising price of coin there will be bigger budget for everything… like in dash :slight_smile: )

Next thing - raising the requirement for stake each month by 10% is not good idea because it should be % from rewards not % from total coins (it will make unstable network because some people suddenly will not have enough coins for stake… )
My suggestion is to take 50% from reward each month (average) and add to next month as min (then you always have some reward for hosting fees etc and will be less dumps also and stable/rising price)


#33

There is a thread open in the Ideas Bucket catagory https://forum.zencash.com/t/ideas-bucket/810/27 relating to this discussion, further ideas/views welcome!

I agree with rebel that the white paper revision due to be undertaken to update the road map should also include revision of the white paper sections listed below (with suggested text amendments). The success of the number of secure nodes (approaching 4,000 as of now) needs to be consolidated. If present structure is left in place, these numbers will very likely fall off as the incentive will not be sufficient to retain System Admins renting/maintaining secure nodes VPS. Developers are justly paid at the going rate to develop ZenCash code, surely System Admins should expect rewards that reflect expertise and staking commitment. I’ve included rebels suggestion of raising the requirement for stake each month by taking 50% from reward each month (average) and add to next month as min (then you always have some reward for hosting fees etc and will be less dumps also and stable/rising price). From my calculations, this would be 1.5 ZEN per month increase at current rates. I hope the discussion elsewhere on the forum site and this post in Ideas bucket results in a formal proposal.

I have an updated spreadsheet that shows sliding scale calculations and % rewards for secure nodes as numbers increase to 10,000. https://drive.google.com/file/d/1wPsUtOiYTyzBT6i0QslHDtIPrTMzaBVn/view?usp=sharing


#34

Great discussion. I’m a securenode runner and a miner. Sure, the reward seems small for securenode operation, but the network is probably over-provisioned for secure transactions right now. There has been a lot of excitement about the network and we might be at a short term peak. The node count will reach an equilibrium no matter what the rewards are set at. We haven’t had time to reach that equilibrium yet. Give it some time. As nodes shut down because the reward is too low, the proportion handed out to each will rise.

The question is, how many nodes does the network NEED to handle the shielded transaction load? If there comes a time when we are around 50-60% capacity, I’d consider raising the reward. Right now we’re all just on a gravy train. My 42 Zen are earning about 70% interest annually for doing almost nothing. I’m completely satisfied. I feel richly rewarded.

To sum up, it’s too early to change anything. Let’s wait and see what the network needs. As the price and traffic fluctuate, the picture will change. Perhaps the core group can come up with some objective measures that we can all watch in regards to secure node performance. Just be patient.


#35

I think the original target Rolf had in mind was between 1000 an 2000. I’m inclined to say we haven’t missed the target, but we have exceeded it.


#36

Awesome discussion!
Few things I’d like to point out:

  1. Whitepaper is “outdated” in some aspects. There is no core reward; 8.5% goes to DAO.
  2. DAO funding includes “payroll”, marketing, development, et cetera. Everything what is spent on chain infrastructure.
  3. We are! actually thinking about cashback program.
  4. Everyone of you is a part of core team with equal rights.

We don’t have problem with funding atm. We’ve got influx of money since price jump and are still looking for the best ways to spend it. We do not and will not blindly give ZEN away to marketers we never worked with. In fact there have been “scam artists” filing proposals with an intent to market ZEN… We are actively developing trust and relationships with people we like though! But we certainly do have money for marketing now. Another problem with industry is that a lot of people are already invested in our “competition” so instead of supporting us and our idea they choose to ignore or sabotage.

As to Secure Node rewards, there are few points to be told:

  1. Conceptual. We want ZEN to be open, all-inclusive system. We don’t want there ever to be a moment when secure node costs 1M USD equivalent. If it comes to that I personally will create a proposal in our DAO to lower stake requirement to an acceptable amount.
    I’m not denying that monetary reward is important. Most of you are in here to make profit and that’s completely fine. But please, take a step back and think for a minute of a big picture. As of now secure nodes bring you 40% back in a year. That is already crazy good (and I expect it to lower eventually). We could throw away our principles right now, utilize a standard MN scheme but let me ask you – Do you honestly believe that’s the best way of action? The whole thing with MNs smells like a pyramid scheme, it stinks of that. Ask yourself, if you haven’t encountered crypto, and 5 years from now you finally get into cryptosphere – which project will you choose to support? Open, all-inclusive, transparent, driven by community, or the one where 90% of supply is held by early investors who bought it all for cents?
  2. Unknown territory. ZEN is meant to be dynamic, ever changing and adopting to whatever’s to come. We simply do not have data right now. Let secure nodes run for some time. Once we identify concrete things lacking in current system we can make a change, but we simply do not know it yet.
  3. DAO. It’s awesome (it really is!) to see everyone raise their opinion but we do not know if that is an actual representation of a wider community. We have thousands or tens of thousands members at this point, speaking different languages, communicating in different channels. Until we have DAO with a voting we are extremely cautious with any change of direction. There’s whitepaper and it has clearly outlined general direction and we will keep to it until DAO. After DAO, it is absolutely in community hands. So I’d love to discuss all of this but do not get offended if the change of policy takes months, we do need to make sure everyone’s fine with it.

Personally I’m not fan of a miners having majority reward myself. Moreover it is not really possible to “piss off” miners, as long as your currency is profitable to mine, even with 1% reward, there will be hash. Thing you have to consider is that we have only 35msols on average. To attack ZEN you’d need that, or a little bit more. And sadly that is possible, nicehash had up to 90msols at it’s disposal for example, or one of the ETH miners if he were to switch could pull an attack off too. There are many other equihash coins with much weaker hashrate and they do not get attacked (komodo for example) but it does not mean we shouldn’t be concerned about it. We are going to be censorship resistant. We are very strong already but we will get stronger. And when we talk about censorship what we mean by that is a coordinated attack by big institutions with a lot of money and people.

The way I see current system is that over time we will keep adding services alike Secure Nodes. One example would be ZenPub. In a similar fashion, we would deduct let’s say 1-2% from block reward to fund it. And similarly you’d be able to participate in ZenPub reward system, likely running it alongside secure node. Or another thing: tracking/payment system. As of now it is centralized on our servers but we will be working towards community members host it and embedding it in protocol. That would be another way to participate and earn separate reward.

Big plus of this vision in my opinion is that it would gradually lower mining reward without anything drastic.

Lastly one thing I noticed. People pushing for an increase want a mechanism to stake their coins. You don’t necessarily want to increase secure node reward, you just want that mechanism, either PoS or MN. This is where frustration comes from: secure nodes are not meant to be PoS or MN. So I’d propose to fantasies a little and think about that instead? How do you imagine it would look in ZEN and what function would it serve if any? Can you think off a staking system so that it stays fair to new comers and doesn’t damage ecosystem?

–Alex Zabuga


#37

I think the number of secure nodes will find an equilibrium between the zen reward and the zen price. If the price of Zen goes up in the long run, then a further divided node reward would still equate to the same fiat incentive.

Even if the reward was increased to 5% or some arbitrary increase, all that would do is incentivize more nodes join resulting in the same equilibrium as we have now. If we assume all things being equal.


#38

so if you have money - why don’t you use money to make zencash more popular? Why are you waiting? You say that some people invest in competitors… yes and will be more such people and more because you need to make decisions faster, grow faster. You are changing page and logo more then month and this is so simple…
about proposals and “scam artists” i did not saw here any stupid ideas but many of them need to talk, make some little changes and act, invest - thats why in you team should be 1 person with experience in marketing, seo etc to manage everything and correct/change sometimes some ideas. It will be also good to pay for such help but not as prepaid only postpaid (so first work, effects and then reward) - it is really simple also. You should start trust people because we also trust you, we invest our money in this coins, our rigs etc. So be also open for ideas, because we also want zencash sucessful like you and core team.

If you have money if you have someone experiences in marketing in your team - you should use few different marketing asap. It is really not so hard to make huge things with this coins… but you need to take few decisions and be smart + act now because competitors (like dash etc) now have money and have much more power. You need to use marketing if you want to catch top25 coins.

I still think that 88% / 3,5% = too huge difference especially for secure nodes requirements (bigger then for masternodes). I also do not understand why you do not wan’t that secure node will be worth 1 million usd. If you want that everybody can have zencash or secure nodes… .then sell all coins and make dump so price will be for coin $0,1 and all world can buy almost for free everything… crazy but i think core team and everybody who has zencash, secure nodes and mining zencash are interested that value of this coin will be bigger and bigger, especially now when market for crypto is great and every smart team should be active and use good time to make coin huge.

ps. what is ZenPub, where can i read about it?

ps. add to main page your youtube channel and fb page. This is ridiculus that there are for example telegram, discord (so place not open and where are very little people) and no so popular channels like youtube or fb where you have almost unlimited potential to advertise, to find people interested in crypto… :slight_smile: You should make such links, icons without submenu becuase it is important and need such thing advertise/make more popular… and such things like github you do not need so advertise because average investor usually do not need github.
You also have many mistakes on your main page (SEO) - you gave your main power to many pages (like pools and for each pool 2 links) from your main page (seo authority) and you gave from them almost nothing (seo power) :slight_smile: (need make it smart so make subdirectory for example MINING and there add such links not from main page)… You really need help to manage marketing because many things are not done correctly :slight_smile:


#39

We are not waiting. We are actively looking for the right things and people to do and we already have something good coming. Indeed this is everyone’s money and we feel responsible how to spend it - we want to do the best possible decisions.

Zen can cost 1M, but a secure node never should. In a case ZEN costs 1M secure node stake should drop down to 0.01 ZEN. But that is long road ahead and not up to us to decide - you will decide on that with DAO.


#40

Hi, I would like to give you some perspective from my side. I put up a few nodes and this was really tough for me since I am not used to it. The payment since the start of december has constantly declined, where the value has been the nearly the same. Now come my point:
I get really nervous, when people say: “Na, Secure nodes are anyways not for profit, just because we simply love and follow the fork of zcash.” Firstable, there is no work for free. These are not the values you have talked about here before. If secure nodes are only for “fun”, which is fine, then my proposal would be to reduce the staking amount from 42 to 4,2ZEN. For me the amount of 42ZEN is alot for “fun”. Especially as we are in a total hypephase in crypto, which will not last forever. I already “lost” money by betting on this plattform, while nearly all of other privacy coins went threw the roof. Now, its possible, that 5 months from now the price will drastically change and we are all fine, but for now this is the reality. I get more and more the feeling, that 90% of the people here are already on from the start, buying in at 6$ or less. If you think this is not about the money I will congratulate you for your idealism, but this is a real volatile market and the risks have to reflect possible earnings.

Anyways, you can see that there is some frustration with the fact, that every shitcoin with a homepage is on the top 100 and ZENCASH is not.