• KuCoin to enable $ZIL staking option for its registered users from 18th June
• Binance to join as a staking partner later this month

By now, the wider community knows that Zilliqa is all set to enable staking in order to push our network’s decentralisation to a new level. Staking will open access to manage Zilliqa seed nodes to our ecosystem of miners, token holders and developers and will create more utility for $ZIL.

Change to ZIP-3 Staking Proposal

We would like to bring to your attention some changes that have been made to the staking parameters due to the recent reduction in inflation. In an earlier version of the ZIP-3 proposal (for staking), a maximum of 700 million $ZIL could be staked across all nodes with each node allowed a maximum of 70 million $ZIL. With these parameters, the annual returns from staking was around ~10% (10.42% to be precise). However, due to mathematical enforcement, we reduced the max from 700 million $ZIL to 610 million ZIL across all nodes and from 70 million $ZIL to 61 million $ZIL per node. These changes were made in order to maintain the annual yield at around ~10% (10.03% to be precise).

KuCoin as a staked seed node operator

At the Messari Mainnet event, we were obviously thrilled to announce KuCoin as our first partner, ensuring a user-friendly experience for all those who wish to stake with Pool-X. They will activate their $ZIL staking option on 18th June. Watch out for the KuCoin announcement on that day — and mark your calendars accordingly!

Given that the staking contract does not impose any hard limits or constraints on the number of users who can stake, the cap on each user, etc., seed node operators such as KuCoin are at liberty to set their own staking limit and prerequisites to adapt to market demand. Therefore, we advise you to read their disclaimers and guidelines before you proceed. We summarize below a few key points that you may need to know about staking your tokens via KuCoin:

• KuCoin will follow a soft staking approach. With this flexible option, users can earn staking rewards anytime without locking up their funds. All they need to do is hold tokens in their Pool-X account on KuCoin. They can receive rewards daily
• In order to compute the daily reward for each user, KuCoin will take several snapshots of user balances and compute the average amount held per user during 24 hours. Based on this, it will reward the user the following day
• Staking on KuCoin will be demand-driven; i.e., there will be no limit on the number of users who can participate. The return rate will depend on the total numbers of users staking with KuCoin at a given time. For example, given that a max of 61 million $ZIL can be staked per seed node which gives a ~10% return per annum, if KuCoin receives 122 million $ZIL (i.e., double the allowed maximum) from its customers, it will then accommodate the entire 122 million $ZIL and reduce the return from ~10% to ~5%
• However, the rate will be equal across all users, i.e., every customer will receive the same returns whether ~10% for everyone (in case only 61 million $ZIL are staked) or ~5% for everyone (in case 122 million $ZIL are staked)

Binance to come aboard as staking partner later this month!

As also mentioned during our presentation at Mainnet event, we’re thrilled to have secured world-class Tier-1 partner Binance to support the second staked seed node (SSN) service. They will announce their launch date soon, so make sure you follow their website updates here.

Interested in staking but don’t know where to start?

• Are you a token holder? Sign up to staking on a partner exchange following their instructions and KYC processes. Once they enable staking on their respective platforms, you can simply hold the preferred portion of your $ZIL within an allotted staking wallet; and begin accruing rewards!
• Are you an aspiring seed node operator? Since we launched our code on Github, some of our seed node slots have already been filled. Some of the remaining slots will be reserved for the next staking phases — which will be non-custodial in nature. We discuss this further below.

Understanding staking in phases

Phase 0: Preparation [Completed] ✅

• January: Zilliqa staking proposal released in the form of a ‘Zilliqa Improvement Proposal’ or ZIP
• February — April: Implementation of staking infrastructure and contract
• April: Open-source smart contract code published on Github & Zilliqa issued open call for security experts to vet the code
• May: Staking went live on the test-net. Subsequently, Quantstamp audited the contract to find no major issues. Zilliqa improved code quality based on their suggestion and implemented fixes for minor issues. Integration began.

Phase 0: Launch [On-going] ⌛

• June: KuCoin (Finalised for 18 June)
• June: Binance (To be revealed soon!)

Phase 0 staking requires end users to transfer their funds to the seed node operator. Hence, operators such as KuCoin have to custody the funds for its delgatators, later deposit them in the contract and receive rewards on behalf of the delegators.

Phase I: [On-going] ⌛

Phase I will use a different contract that will allow end users to directly transfer their funds to the contract, and hence remove the need of an intermediary custodian. Users will then be able to use wallets such as Moonlet to transfer their funds to the contract while specifying the address of the seed node operator they wish to delegate with. Work on Phase I has already started. You can follow the contract development on GitHub.

Upcoming Staking AMA

If you have any queries on staking with Zilliqa, join us for an AMA session on our official Telegram channel, scheduled for 12 June from 10–11 PM SGT. Our President Amrit Kumar, as well as members of the marketing team will be available to help you.

If you are unavailable at this time, please feel free to contact us via Telegram. Our community managers will help you.

Security advisory: Staking can be only conducted via the staking microsite provided by our official partners. Anyone who offers alternative options such as staking via private message, online forms or non-official partners are likely to be a scam. We will always announce our staking partners through our official social media and community channels.

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