Slashing

Slashing is a mechanism built into proof of stake blockchain protocols to discourage validator misbehavior. Slashing is designed to incentivize node security, availability, and network participation.

The two key misbehaviors that incur slashing are downtime and double signing. While the specifics of slashing are defined within each protocol, the mechanism is similar: a predefined percentage of a validator’s tokens are lost when it does not behave consistently or as expected on the network. Double signing penalties are typically much larger than downtime penalties.


What is correlated slashing?

Polkadot and eth2, among other networks, incentivize decentralization and security with correlated slashing. Correlated slashing means that slashing penalties escalate based on the percentage of total validators participating in the behavior (downtime or double signing) at the same time. For example, if 25 out 200 validators are down, the slashing penalty is smaller per validator than if 50 out of 200 are down.


What is downtime?

Downtime occurs when a validator is unavailable to sign transactions on a blockchain for a certain period of time. Expectations for the uptime of a validator are dependent upon the protocol. If a node remains unavailable for long enough, it may be subject to penalties, including slashing.

Downtime often occurs if a node’s cloud infrastructure goes offline or a node is out of sync with the chain. Not all protocols consider downtime a slashing offense.


Downtime slashing parameters per protocol

Protocol Definition Slashing Amount and/or Consequences
Algorand N/A N/A
Cardano N/A N/A
Celo Absent from 8640 consecutive signatures 100 CELO, future rewards suppressed, and ejected from validator group
Cosmos Down for more than 5% of the last 10000 blocks (offline ~ 13 hours) 0.01% and validator removed from consensus and does not earn rewards for at least 10 minutes
Crypto.org Down for 50% of the last 2000 blocks 0.01% and validator removed from consensus for one hour. Validator must create an unjail transaction to rejoin the active set.
Diem N/A N/A
Eth2 N/A In most circumstances, penalty is not earning rewards; if validator is offline regularly could lose up to 10% of stake
Edgeware Fails to produce blocks during an epoch and fails to send a "heartbeat" message that it is online Fixed percentage of EDG based on number of validators down (correlated slashing) and validator removed from next active set election
Flow N/A No downtime slashing except Collection Nodes can be slashed if too many are down simultaneously
Keep Signer Failure - Random Beacon: more than 50% of beacon group (>32) are offline for 384 blocks (~ 90 minutes)
Signer Failure - TBTC: signer does not respond to a TBTC redemption request within 3 hours
Signer Failure - Random Beacon: 100% of the minimum stake
Signer Failure - TBTC: Anyone can submit a proof you are late and put you into liquidation. No KEEP tokens slashed.
Kusama Fails to produce blocks during an epoch and fails to send a "heartbeat" message that it is online Fixed percentage of KSM based on number of validators down (correlated slashing) and validator removed from next active set election
Mina N/A N/A
NEAR Generating less than 90% of the blocks expected Kicked out and loses seat; validator can re-stake after two epocs and sign blocks again after three
NuCypher N/A N/A
Oasis N/A N/A
Ontology N/A N/A
Polkadot Fails to produce blocks during an epoch and fails to send a "heartbeat" message that it is online Fixed percentage of DOT based on number of validators down (correlated slashing) and validator removed from next active set election
Solana N/A N/A
Terra Non-responsive for more than 95% of any 10,000 block interval (~17.7 hours) 0.01% and validator is jailed for 10 minutes
Tezos Failure of baker that baked the 32nd block in previous cycle to reveal the nonce used to bake it Bond seized and burned

What is double signing?

Double signing occurs when a validating entity (private key) submits two signed messages for the same block. This behavior may occur if a node operator, or infrastructure provider, optimizes their node configuration to prevent downtime by having a highly available backup entity running at the same time as a primary entity.

Many proof of stake protocols penalize double signing because this validator misbehavior makes it more difficult for the network to reach consensus. Consensus—how nodes on a network verify transactions and their order in a decentralized blockchain network—is a critical step to prevent invalid data being written to the ledger, the record of all transactions.

The slashing penalties for double signing can be very dangerous for anyone participating with their stake in a network: token holders and validators can lose existing funds, not just miss out on future rewards.


Double-signing slashing parameters per protocol

Protocol Slashing Amount and Consequences
Algorand N/A
Cardano N/A
Celo 9000 CELO plus future rewards suppressed and validator ejected from the validator group
Cosmos 5% and validator can no longer propose blocks or earn rewards
Crypto.org 5% and validator is blacklisted and removed from consensus forever
Diem N/A
Eth2 From 1 BETH to entire stake based on the number of validators committing offense (correlated slashing) and validator ejected from the Beacon Chain active set
Edgeware Fixed percentage of EDG based on number of validators committing offense(correlated slashing) and validator removed from next active set election
Flow Case-by-case basis
Keep N/A
Kusama Fixed percentage of KSM based on number of validators committing offense (correlated slashing) and validator removed from next active set election
Mina N/A
NEAR N/A
NuCypher N/A
Oasis 100 ROSE and validator is frozen and can no longer participate in consensus
Ontology N/A
Polkadot Fixed percentage of DOT based on number of validators committing offense (correlated slashing) and validator removed from next active set election
Solana N/A
Terra 5%
Tezos Security deposit plus pending rewards from the beginning of the cycle and up to the submission of a valid accusation. (Delegators can not be slashed.)

Are there other penalties for misbehavior?

A few protocols penalize validators for performing harmful or malicious behavior outside of downtime and double-signing.


Other penalties per protocol

Protocol Other penalties
Keep Signer Fraud - any signing group that moves Bitcoin without authorization (steals): signer is slashed 100% of the minimum stake
NuCypher False Re-encryption/Incorrect Re-encryption - 2×10−18 NU tokens will be deleted for each violation
Terra "Missed too many oracle votes - 0.01%"

How does Bison Trails minimize the risks of slashing?

Under development for the better part of a year, Bison Trails’ Double Signing Protection software addresses one of the biggest risks of participating in a Proof of Stake blockchain network: slashing penalties if a validator double signs blocks. With Double Signing Protection, it’s now much safer for anyone using Bison Trails’ infrastructure to participate in supported networks.

Bison Trails’ Double Signing Protection was designed to address the need to minimize the cost of losing stake and reductions in rewards for customers running a node—on networks like Tezos that have double signing penalties—in order to minimize the risks of participation and further professionalize blockchain infrastructure service for our customers.

“Without double signing software, operators have to be careful or run scripts that check that they haven’t made a mistake. Bison Trails’ double signing protection provides guarantees and tooling for our response teams to be able to more confidently failover, ensuring high uptime without the risk of double signing.” —Aaron Henshaw, CTO
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About Bison Trails


Pioneering Blockchain Infrastructure®

Bison Trails is a blockchain infrastructure platform-as-a-service (PaaS) company based in New York City. We built a platform for anyone who wants to participate in 25 new chains effortlessly.

We also make it easy for anyone building Web 3.0 applications to connect to blockchain data from 33 protocols with Query & Transact (QT). Our goal is for the entire blockchain ecosystem to flourish by providing robust infrastructure for the pioneers of tomorrow.

In January, 2021, we announced Bison Trails joined Coinbase to accelerate our mission to provide easy-to-use blockchain infrastructure, now as a standalone product line. The Bison Trails platform will continue to support our customers. With Coinbase’s backing, we will enhance our infrastructure platform and make it even easier to participate in decentralized networks and build applications that connect to blockchain data.

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