It is essential for users to stake their PoS tokens with dependable and highly performant validators, which is why we have rolled out our Staking Rewards Verified Staking Provider (VSP) Program in June 2022. Through this program, we thoroughly scrutinize potential validators, evaluating factors such as security measures, their on-chain reliability, their provider setup, and value-added services for the whole ecosystem.
Our VSP documentation contains further details about the program, Staking Providers that are part of the VSP will have a blue checkmark displayed next to their names here.
There are many metrics to consider when selecting a pool to nominate to:
Low commission: The commission rate a pool charges is the % of your reward that the pool of validators keep for themselves. A high commission rate means your rewards will be lower whilst a low commission rate could cause profitability issues for validators in the future. A Staking Pool can be made up of one or more validators, which can each charge their OWN commission rate. The active set on Polkadot changes every era, if just one of your validators gets into the active set, you will support it with your entire stake. If several of the validators supporting your staking pool gets elected, a special algorithm will decide which of them you support with your entire stake. This means that the effective commission rate you pay will vary every era, so make sure that the underlying validators in a Staking Pool each have commission rate that you agree with (< 5% is considered fair on Polkadot).Keep in mind that validators can adjust their commission rates up or down over time.
Number of pool members: A high number of nominators could indicate positive sentiment towards a pool.
Validators Self-Staked balance: A provider that has a high amount of staked tokens likely has more incentive to continue operating their services as they have more to lose than those with low self-staked balances.
Pools should be actively nominating: Look for pools that have a green “Active / Bonded” tag.
Network Share: You typically don’t want to choose a pool with the highest network share or a pool with a low network share. Nominating to the most popular pools increases centralisation risks within the network as the validators that support that pool will have more say in governance and a larger share of the blocks. A pool with a low network share, might not be profitable and hence increases the risk of them discontinuing their services.
Performance: Make sure you pick a pool that has validators with the highest possible uptime performance by viewing the validator information on the Validator Dashboard. Our recommendation is to only pick those with a >=99% performance and a long history of not getting slashed.
Era points are above average: Validators will get more rewards for being active.
Value Add to the Ecosystem: Some providers offer extra services to their delegators, such as tax reporting tools, explorers, etc. This can be another great way to filter for validators that are thinking long-term. You can view the value-added services of staking providers by clicking on their name on the provider page.
