Today, we are excited to announce our staking partnership with Zero Knowledge Validator (ZKV), a collective of blockchain entrepreneurs, researchers, and developers focused on advancing the adoption of privacy and zero-knowledge technologies across multiple blockchain ecosystems.

Chorus One will provide node infrastructure to enable the Zero Knowledge Validator team to focus on privacy-focused initiatives and to participate in network governance representing their community and mandate. We will initially operate the Zero Knowledge Validators on Cosmos and Osmosis, with other networks to follow in the future. By delegating to the Zero Knowledge Validator nodes, ATOM and OSMO holders can support ZKV’s mission while ensuring their tokens are staked with the industry-leading reliable, secure, and diversified node infrastructures that Chorus One has built over the past three years.

Why We Are Excited To Work With The ZKV Team

The ZKV team, led by Anna Rose and Will Harborne, is active on the forefront of privacy research and development in the Ethereum, Cosmos, Polkadot, NEAR, and Mina blockchain ecosystems. Anna, who is hosting one of the most esteemed crypto podcasts (Zero Knowledge Podcast), is a pillar in the community and has provided a platform for privacy-focused researchers and builders to come together through a series of high-quality events such as the Zero Knowledge Summit, hackathons, online webinars, and more. Will, co-founder of the zk-STARK-based decentralized exchange Deversifi, has a vast network and experience in building scalable, privacy-preserving applications. Together with their collaborators and team of researchers and developers, ZKV provides invaluable help to projects and entrepreneurs to develop and grow their privacy-focused applications.

We are thrilled to be able to provide our services and work closely with ZKV. We expect this collaboration to increase our own knowledge and involvement in the promising field of privacy-preserving technologies and are looking forward to helping the ecosystems we are a part of tap into the resources and support provided by the ZKV team.

If you are interested in learning more, join the upcoming ZKV online event this Wednesday (June 30) focusing on privacy in the Cosmos ecosystem, which will also feature our CCO Felix Lutsch during the panel discussion. Register here: https://hopin.com/events/privacy-in-cosmos

Facilitating Participation in Decentralized Networks

Our mission is to help stakeholders participate and shape the decentralized networks they are a part of. Aside from accepting delegations on our own public nodes and building protocols to advance the staking ecosystem, we are also providing infrastructure services to stakeholders seeking to participate in staking and network governance themselves. To learn more about how we assist our partners that include institutions and companies like Zero Knowledge Validator in their exploration and participation in the staking ecosystem, visit our whitelabel node product offering at: https://chorus.one/products/whitelabel-staking

About Chorus One

Chorus One is offering staking services and building tools that advance the Proof-of-Stake ecosystem.

Website: https://chorus.one
Twitter: https://twitter.com/chorusone
Telegram: https://t.me/chorusone
Newsletter: https://substack.chorusone.com

About Zero Knowledge Validator

Zero Knowledge Validator champions privacy and zero-knowledge technology across the blockchain ecosystem through various initiatives such as research, content, and events.

Website: https://zkvalidator.com/
Twitter: https://twitter.com/ZKValidator

We are pleased to announce that we have onboarded Osmosis, a heterogeneous, interoperable automated market maker protocol built on the Cosmos SDK that gives users and LPs flexibility and customisation never before seen in existing AMMs.

Osmosis is governance-first, it places emphasis on governance having a maximum level of customisation on protocol parameters so it can keep the protocol competitive in the long-run.

Osmosis is likely to introduce a new wave of innovation and creativity for AMMs as participants have the accessibility and flexibility to customise all aspects of an AMM. LPs can select their time horizons for providing liquidity, third-parties can incentivise pools ad-hoc, governance can distribute OSMO rewards where they deem fit, pool creators can play with mathematical expressions (curves) for lower-slippage swapping and users can swap assets cross-chain using the Interblockchain Communication (IBC) protocol, whose usage in the Cosmos ecosystem has been kickstarted following the chain’s launch this weekend:

OSMO Airdrop for ATOM Holders

Osmosis is airdropping a portion of OSMO to those who were holding ATOM when the screenshot was taken for the quadratic fairdrop. You can see if you are eligible here. Without doing anything, holders of $ATOM taken on the day of the blockchain screenshot receive 20% of their allocated OSMO rewards. To achieve the other 80% of allocated rewards, 4 steps are required by $ATOM holders within the first two weeks, outlined below:

1. Make a swap on Osmosis
2. Add liquidity to a pool (e.g. ATOM / OSMO)
3. Stake OSMO
4. Vote on a governance proposal

Further information about who can claim the airdrop and how to claim it can be found here and here

About Staking on Osmosis

Osmosis uses the standard DPoS staking mechanism found in the Cosmos SDK. Users can delegate their OSMO tokens to Chorus One to receive a share of rewards generated by the network.

Epochs: Osmosis uses epochs to account for reward distribution. There is 1 epoch per day. Therefore 1 epoch is ~14440 blocks. Staking rewards are distributed at the end of each epoch.

Validating Rights: The weight of validators such as Chorus One is determined by the amount of staking tokens (OSMO) bonded as collateral.

OSMO Inflation: 300m OSMO in year one. 200m in year two. 166m in year 3. More here.

Staking Reward Rate: Rewards from staking OSMO will vary depending on newly minted and distributed to stakers and the total amount of tokens that are staked at a given time. Another unique aspect of Osmosis is that only 25% of inflation rewards go to stakers (as of genesis). As OSMO is highly inflationary, the expected APR for staking OSMO can be expected to range somewhere between 300–1,000% for the first year (this depends a lot on how OSMO holders are engaging with their tokens). At the time of writing, with around 5.6% of the supply staking (6m of 102m available OSMO tokens), OSMO stakers are receiving a ~3.5% rewards on their OSMO tokens a day!

Learn more about the details of staking reward rates for chains built using Cosmos SDK here.

Chorus Commission: 7.5%

Withdrawal Delay: After withdrawing, your staked funds will only become accessible after the unbonding period (28 days) has passed.

Slashing: You can get slashed (loss funds) in case the validator you are delegated to commits an offense. Make sure to do due diligence to minimize this risk. Offences include double-signing (5% slashing penalty for delegators) and downtime (no slashing penalty, validator is ‘jailed’ and delegators miss out on staking rewards for minimum 2 hours).

Re-Staking: You need to withdraw rewards and re-stake them with some frequency if you want to make use of compounding returns.

Minimum delegation: There is no minimum delegation.

The Chorus One Validator

osmovaloper15urq2dtp9qce4fyc85m6upwm9xul3049wh9czc

Learn more: https://chorus.one/networks/osmosis

How to Stake

Wallets: Keplr
Block Explorers: Mintscan
Staking: Keplr — Once Keplr is installed, find ‘Chorus One’ on this page, click ‘manage’, put in the amount of $OSMO you would like to delegate to Chorus and then click ‘ delegate’.

Explaining how a crypto holder can earn rewards on their assets

What is Staking?

Your crypto-assets earn while you sleep!

Staking is an umbrella term used to denote the act of pledging your crypto-assets to a cryptocurrency protocol to earn rewards in exchange. Staking allows users to participate in securing the network by locking up tokens. Consequently, users are rewarded for securing the network in the form of native tokens.

The higher the amount of crypto-assets you pledge, the higher the rewards you receive. The rewards are distributed on-chain, which means the process of earning these rewards is completely automatic. All you have to do is to stake them. This means your crypto-assets earn while you sleep!

Where do these rewards come from?

Every time a block is validated new tokens of that currency are minted and distributed as staking rewards

Proof-of-stake (PoS) assets like Solana, Tezos, etc let you earn rewards on your staked assets. There are two types of rewards that get distributed

1. Staking rewards/inflationary rewards
2. Transaction fees

Note: I use the terms protocol, network, and cryptocurrency interchangeably. They mean slightly different things but convey the same logical concept

Staking rewards — You stake your crypto-assets with a PoS node (a server running the protocol stack) to validate a block of transactions. If the node you have delegated to successfully signs or attests to blocks, you receive staking rewards — thereby increasing your net crypto-assets. In case your node is unresponsive or malign (double-signing), a portion of the node’s assets, and hence your assets, can get slashed or destroyed.

The staking rewards are, thus, an incentive for these nodes to perform the process of ordering the transactions, verifying them, collecting them in a block, and subsequently validating the block. When these rewards are freshly minted they get the name inflationary rewards.

Every time a block is validated new tokens of that currency are minted and distributed as staking rewards!

Transaction Fee — In addition to the staking rewards, each transaction carries with itself a small fee making it easier for the node to prioritize the selection of transactions to be entered into the block. The accumulated fees from the underlying transactions also go to the node.

Transactions are what make up a cryptocurrency. For different protocols, these transactions could mean different things. They vary from token transfers to smart contract executions. Despite the dissimilarity in transaction types, the common thread is that these transactions always get ordered and clubbed into a new block so that all nodes in a network can agree on the state of the network.

In a centralized institution like a bank, every transaction can be verified by the central authority (bank’s central server). However, the lack of centralized authority in the crypto world requires the verification and subsequent validating of these blocks by the decentralized nodes of the network. These nodes are known by a variety of names — validators, bakers, etc. Their counterparts in the proof-of-work networks are called miners!

How can I participate in staking?

If PoS were a democracy, your stake would be your vote!

Staking does seem like a fairly useful investment instrument for anyone whose assets are lying idle in a digital wallet or a ledger. One can perform two roles when participating in staking.

1. Validation — Appropriate for companies or technical enthusiasts
2. Delegation — Appropriate for most individual crypto-asset holders

Delegation is the method by which an individual can reap the rewards of staking. However, to understand delegation we will have to get into the details of how proof of stake (PoS) works!

If you already know how PoS works you can skip over to the delegation section.

Proof of stake

Proof of stake, just like Bitcoin’s proof of work, is a type of Sybil resistance mechanism used to ascertain participation in blockchain consensus by utilizing assets as collateral. In simpler terms, to become a validator node in such a network crypto-asset holders are required to stake their tokens as collateral, instead of spending electricity as is the case with Bitcoin nodes.

Additionally, validators are selected randomly to create the block. The probability of a validator’s selection is directly proportional to the volume of crypto-assets staked.

This means that PoS is a system where the value at stake is the main determinant of which blocks are added to the blockchain. If PoS were a democracy, your stake is your vote! Participants in a Proof-of-Stake network essentially vote with their assets on blocks of transactions that they deem valid. They get rewarded if the majority of the network agrees and risks losing their stake (deposited tokens) if they try to cheat, e.g. by voting on two different blocks of transactions at the same time. The former encourages a rise in the number of nodes and the latter discourages malicious behavior.

Does this mean that anybody who holds even 1 token can become a validator? The answer is an obvious NO! Generally, the requirements to become a validator are much more stringent and difficult to achieve practically. Let’s take a look at a few of them.

To become a validator some of the hurdles one can possibly face.

• Stake a minimum amount of tokens — For example in Ethereum 2.0 one would need to stake 32 ETH
• Set up secure and performant infrastructure that should ideally be online 24x7
• Build a team of skilled engineers to run and continuously upgrade the infrastructure in accordance with the protocol.

These are just a few of the hurdles to become a validator. Not all of them apply to every network but most networks demand steep requirements that an individual may find difficult to fulfill.

Delegation

Owning a huge number of tokens of a single currency or operating validation infrastructure may not seem worthwhile to a lot of people. Fortunately, most PoS protocols foresee this problem and incorporate ways to enable asset holders to stake their tokens with a validator that they do not run themselves.

The process of staking your assets with a validator without actually sending them your tokens is commonly called delegation.

Delegating your assets means letting them count towards the stake of a validator in return for a share of the reward received. In practice, a delegator deposits tokens in a smart contract specifying the validator whose influence in the network she wants to increase. As a result, the rewards earned in the validation process increase, but instead of only the validator receiving compensation, the rewards are automatically split between the validator and the delegator, usually by applying a simple commission rate as pictured below.

Choosing a validator

When delegating your assets it is extremely important to put special emphasis on choosing the validator. A more reliable validator will keep your funds secure as well as grow them reliably. Some of the factors for deciding your validator are as follows.

1. Uptime — Percentage of time a validator is available online. This indicates a validator’s reliability.
2. History of slashing — Slashing is the process of punishing a validator for being unavailable or making mistakes while signing blocks.
3. Years of operation and supported networks — it is likely that validators that support multiple networks and are operating for a long time are more experienced and reliable.
4. Financial health — There are costs associated with building and maintaining secure validator infrastructure which include hardware costs, employment costs, etc.
5. Governance support — How actively do they participate in protocol governance and similar discussions indicate their intent to further the cause of decentralization.
6. Community — Anyone who makes an effort to put out blogs of high quality, podcasts, Telegram responsiveness, and other ecosystem support is bound to be there for the delegators always.
7. Team — Always check out the validator’s team page, Twitter accounts of founders, and Github repos. A validator with respected founders, excellent engineers, and helpful Telegram channels is assured to keep your money safe.

Staking v/s other investment strategies

Keeping crypto-assets liquid is a good strategy for the short-term investor but is not wise for those who are in it for the long haul.

The end of Hodling

The traditional method of crypto-investing was a rather straightforward experience — you obtain the desired crypto asset, store it (or leave it on an exchange), and wait.

Simply holding a PoS token is no longer an optimal strategy now! Many networks reward participation by inflating tokens and handing them out to participants resulting in a dilution of the assets of non-participating token hodlers.

But is staking the best alternative out there for the Hodlers? Let’s take a look at some of the investment strategies.

Continue Hodling

Keeping tokens liquid is a good strategy for the short-term investor but is not wise or recommended for those who are in it for the long haul.

Stake

When staking, an investor has one of the 2 options

1. Delegate to other validators — Easy but fewer rewards
2. Validate yourself — Difficult and average rewards

Other strategies

1. Loan tokens (e.g. using lending protocols like Aave or Compound)
2. Use tokens as collateral (e.g. issuing DAI with a Maker vault, or using tokens in other decentralized finance protocols)
3. Liquid staking — Liquid staking combines the benefits of staking with the liquidity of the above-mentioned strategies. The staked positions are tokenized and by doing that one is able to achieve liquidity. The liquid tokens provide further leverage through collateralization and investment in DeFi.

Assessment

Staking is the more reasonable investment for the long-term investor but liquid staking is emerging to be a clear winner among all the strategies. It provides the benefits of reward accrual through staking while hedging the liquidity risk. Liquidity risk mitigation is a huge need that gets addressed through liquid staking and might become the reason for its success.

Chorus One published a comprehensive report last year that turned out to be foreshadowing in many ways. It is worth a read and goes into great detail about what this strategy entails.

Ethereum is moving towards fully migrating to Proof-of-Stake and Lido Finance is providing a liquid staking solution for it. This article by Paradigm covers how a decentralized eth2 stake pool provides liquidity to staked assets:.

Chorus One is also building a liquid staking solution for Solana on behalf of Lido:

Introducing Lido for Solana

Explaining the SOL liquid staking solution by Chorus One

medium.com

The benefits of staking come bundled with some risks as well. Let’s take a quick look at that.

Risks of staking

From an economic perspective, a rational investor should choose the option with the highest risk-adjusted return. In practice, this means that a token holder should figure out

• The kind of risks involved (ideally quantify them)
• The expected returns (after subtracting costs and considering other limitations) of the various options
• Compare the various alternatives to each other to make the optimal decision based on her risk profile

Let’s analyze risks associated with staking.

1. Liquidity risk associated with having to lock up staking tokens — There is often a lockup period associated with staking to be able to penalize potential malicious nodes and to prevent long-range attacks. Without this period a malicious party could attack the network and withdraw their stake immediately leaving no chance for the protocol to punish his offense. However, liquid staking alleviates this risk neatly by making staking a more capital-efficient process.
2. The risk of losing deposited crypto-assets due to slashing — Staked crypto-assets in a PoS network are often subject to being slashed (destroyed) should a malicious action be detected by other network participants. A common slashable offense is the signing of two blocks at the same height, also referred to as double-signing.
3. Low returns due to bad validator performance — Operating validation infrastructure is an extremely challenging responsibility. Failing to propose or verify blocks of transactions means missing out on rewards and being offline for some extended periods of time can even result in liveness-slashing. Continuously signing and sending messages on behalf of staked crypto-assets as part of the consensus process requires technical and operational excellence. There are additional functions that validators may need to perform like providing prices as oracles. All of this requires technical expertise. The lack of it is a risk to the delegator.
4. The opportunity cost — There is an opportunity cost of using the token differently, e.g. loaning it. Additionally, there is an opportunity cost to stake with a different validator. The liquidity risk makes it difficult to move the staked money quickly. This risk too is largely mitigated by liquid staking making it easy for the asset holder to reap rewards on the liquid tokens.
5. Minimum staking balance — Sometimes protocols impose a minimum staking balance. This becomes a hindrance for small ticket investors. However, again liquid staking can help here by enabling smaller delegation limits as is done by Lido on Ethereum 2.0.

The following table compares the risk-reward scenarios for the various strategies available to a crypto investor. Clearly, liquid staking wins across the board.

Why Chorus One?

We are growing quickly and have been entrusted with $1.4 Billion worth of assets!

Chorus One is a provider of staking services and validation infrastructure with a focus on providing the highest degree of security and quality possible. Our goal is to help token holders earn interest on their crypto assets securely and consistently.

We support close to 20 networks and one of the top validators on networks like Solana, Cosmos, SKALE, and many others.

We have been reliably operating for the last 3 years and have been around for longer than most of our competitors. We are growing quickly and have been entrusted with $1.4 Billion worth of assets! We are also venturing into the space of liquid staking with the proposal for Lido for Solana already approved by the Lido DAO.

For more information follow our social media channels.

Website: https://chorus.one

Twitter: https://twitter.com/chorusone

Telegram: https://t.me/chorusone

Newsletter: https://substack.chorusone.com

Thanks to the editors

Felix Lutsch

and

Xavier Meegan

for resources, contribution to the text, images, and feedback.

Today we are pleased to announce our support for staking on Persistence, a network that is boldly attempting to create an interoperable marketplace for institutional asset transfer. Persistence is essentially re-creating accessibility for institutional liquidity and retail participation. The first product Persistence built was Comdex, a blockchain-based marketplace for trade finance and commodities. Using smart contracts, Persistence was able to standardise and bring immediate liquidity to the trading of commodities in Singapore. Since then, Persistence has built multiple products. One such product is a DeFi protocol known as pLend, where commodities companies can use their real-world assets (with terms in smart contracts) as collateral to borrow stablecoins supplied by crypto-native users. Other products Persistence has built include Audit.One, a validator that runs a node on multiple networks (including many that Chorus is also active on, e.g. Cosmos, Terra, NEAR, SKALE, and Celo) and pStake, a liquid staking protocol aiming to unlock liquidity of locked staking tokens in the Cosmos ecosystem.

Overall, Chorus and Persistence have a deep understanding of the intricacies of many networks and will be able to share that knowledge with each other to improve upon the security of Persistence’s own network. Not only that, Chorus will also be able to share its own liquid staking experience with Persistence to assist them building out liquid staking protocols on networks we both support.

We are yet to see exactly how real-world finance, DeFi, and staking will coalesce in the future. Running a node on Persistence allows us to contribute to a network that actively works on experimenting with the possibilities of this rich intersection within the Cosmos ecosystem. We are pleased to have the opportunity to secure a network that is building in areas that greatly align with Chorus.

Felix Lutsch, CCO of Chorus One

Chorus One is one of the most distinguished validators in the Proof-of-Stake ecosystem and has been at the forefront of innovation within this domain.

Meher (Co-Founder of Chorus One) has been a guiding force in my Crypto journey and now we are honoured to have Chorus One as a Validator on Persistence.

Persistence and Chorus One have a lot of synergies including on the soon to be launched liquid staking app — pStake Finance — by Persistence.

Tushar Aggarwal, CEO and Co-Founder of Persistence

About Staking on Persistence:

Persistence.one is built using Cosmos SDK. Users can delegate their XPRT to Chorus One using a wallet, such as Keplr.

Validating Rights: The weight of validators is determined by the amount of staking tokens (XPRT) bonded as collateral.

XPRT Inflation: 35%

Reward Rate: Rewards from staking XPRT will vary depending on the inflation and total amount of tokens that are staked at a given time. Learn more about the details of staking reward rates for chains built using Cosmos SDK here.

Chorus Commission: 8%

Withdrawal Delay: After withdrawing, your staked funds will only become accessible after the unbonding period (usually 21 days) has passed.

Slashing: You can get slashed (loss funds) in case the validator you are delegated to commits an offense. Make sure to do due diligence to minimize this risk.

Re-Staking: You need to withdraw rewards and re-stake them with some frequency if you want to make use of compounding returns.

How to Stake your XPRT with Chorus:

Persistence Staking FAQ: https://chorus.one/networks/persistence

Persistence Staking Guide: Persistence XPRT Staking Guide

Persistence Wallet: Keplr

Persistence Block Explorers: Persistence Block Explorer

Persistence Staking Reward Calculator: Staking Rewards