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The Decentralizer
While mSOL is an elegant solution for most, liquid staking can be considered a taxable event for some users, or they may also wish to conserve full ownership of their stake.
What is the Decentralizer?
βThe Decentralizer is a public goods tool (meaning that there are no management fees) designed by Marinade in coordination with Solana Labs. It allows users to delegate the management of their stake accounts while conserving full ownership of them.
Users will not receive mSOL and won't be able to participate in DeFi , but they will spread their stake according to a specified strategy and diversify it automatically through The Decentralizer, removing the need to monitor and manage it.
When using the Decentralizer, only the management authority of the stake account is delegated to The Decentralizer while the withdraw authority stays in the hands of the stake account owner. Your accounts stay under your control, and the service is fully non-custodial.
How does The Decentralizer work?
The Decentralizer will identify your existing stake accounts and allow you to delegate their management authority to it by clicking on the 'Automate' button.
You can also create a new stake account with your existing SOL balance. Creating an account will automate its delegation in the next epoch according to your Selection Criteria settings.
Once the management of your stake accounts has been activated, you will conserve ownership of your stake accounts and The Decentralizer will automatically monitor and manage them in order to spread your risk and reach the validators you want according to your selection criteria.
The Decentralizer homepage
Please note that you don't need to create multiple stake accounts when creating your stake account. The bot will automatically create and split your staked SOL into the appropriate amount of stake accounts over the next epochs.
Your selection criteria is taken into account by the bot handling the automation once per epoch, approximately 10 hours before its end. If you create a stake account or automate it after this threshold, the changes will be applied after the next epoch. You can change your selection criteria as you desire.
What are the Selection Criteria and how to use them?
When using The Decentralizer, you can select the criteria that the bot needs to take into account to create the list of eligible validators for your stake accounts. Stake will be distributed and reallocated when necessary towards those validators by The Decentralizer.
By default, the Selection Criteria are set on Marinade's delegation strategy which will allow you to spread your stake between numerous well performing validators to decentralize the Solana network, while conserving the ownership of your stake accounts.
It is also possible to diverge from this strategy and setup your own criteria if you want to prioritize other parameters. The available parameters allow you to select the numbers of validators you want to reach, their minimal performance, their commission, the data center they use, etc.
The filters 'Exclude validators with old software versions' and 'Exclude validators within the Nakamoto Coefficient' cannot be changed and are here for informational purposes. They can't be excluded of a strategy.
βASN (Autonomous System Number) are large networks that can be identified and linked to a set of IP adresses that have a geographical proximity. It is used to determine the localization of the validator and its surroundings.
Once you have created your own criteria, use the 'See Filter results' button to generate the list of eligible validators. If you are satisfied with it, you can validate it with the 'Save Selection Criteria'. A pop-up indicating that the operation was successful will appear.
If you create personalized settings, you need to ensure that enough validators are part of the list before validating your criteria.
Example: if your strategy aims at staking to 50 validators but your criteria are set too high and only 5 validators on the network are eligible to them, only 5 validators will be staked to. If the situation evolves and no validators are eligible anymore, a switch to the default criteria will be done automatically. This only happens if there are no validators eligible to your criteria.
How is the balancing performed?
Once every epoch, approximately 10 hours before its end, The Decentralizer will evaluate the status and performance of the validators you are delegating to with your stake accounts, and plan the necessary actions to optimize your yield and spread your stake according to your criteria. Validators performance will be monitored through the same algorithm as the Delegation strategy and all validators data extracted from the Solana blockchain.
In order to balance your stake accounts, a number of actions are taken after the calculation are performed. Those actions will always respect a first set of rules:
- Only 10% of your total staked SOL amount can be reallocated during an epoch, in order to not hurt substantially the overall APY.
- There is an exception to this rule when some validators require an "emergency unstake". If a validator is blacklisted for cheating with credits, becomes part of the superminority or is delinquent and produces no rewards, a full unstaking is performed for those validators and the total can go above the fixed %. Since they would not yield rewards or are actively not helping the network, it is better to reallocate them as soon as possible.
- If a validator that is being delegated to comes out of your selection criteria but is still a performing validator, the unstake will be realized over a few epochs, without going above the 10% limit per epoch. Finally, if all validators are respecting your selection criteria, the bot will slowly reallocate all your SOL towards an "ideal stake" state where the validators in the selection gets stake while maximizing staking rewards. The "ideal stake" for each validator is weighted by the final score of the validator for the epoch.
You conserve access at all point to all the stake accounts and can choose to manually unstake them and stake them where you desire whenever you want. If you choose to conserve stake accounts handled manually, you will also be able to see them in The Decentralizer.
Rebalancing process
In order to reach the ideal stake status for your staked SOL, the priorities of the Decentralizer will be:
- Conserve a good APY according to your selection criteria by optimizing the delegation of your stake accounts
- Unstake from all delinquent validators that would go unnoticed for most users handling their stake accounts manually.
- Reach a healthy distribution of your stake accounts across a number of validators that respect your selection criteria.
For this, the bot will first:
- Operate the emergency unstake actions if needed.
- Operate the partial unstake operations if some validators are overstaked (compared to the ideal stake) or went out of your selection criteria.
- Delegate to eligible validators.
- Merge stake accounts when possible.
Tracking: The Decentralizer will inform you of each and every action it takes, as well as the reason for the action in the 'History' tab.
Step-by-step Guide
In order to use the Decentralizer, you will need to have one or multiple existing stake accounts, or SOL in your wallet. If you do not have existing stake accounts, you can create one by clicking on 'Create stake account' and use your available SOL to create one. There is no need to create multiple stake accounts, the Decentralizer will automatically handle this process over the epochs.
Stake account creation
Creating the stake account with this button will automatically automate the delegation of your newly created stake account according to the strategy you set.
If you have existing stake accounts, they will appear in the 'Manual management' panel.
Manual management panel
Clicking on the 'Automate' button will delegate the management authority of this stake account to the Decentralizer, while you conserve full ownership of the stake account. Also note that no smart contracts are used to delegate your stake accounts to validators according to the strategy you set up.
Now, that you have automated stake accounts, you can apply the delegation strategy of your choice to them. Make sure that your stake accounts appear in the 'Automated Management' panel and click on Selection Criteria.
Use the Marinade Delegation strategy
If you want to use the Marinade delegation strategy:
- 1.Toggle on the 'Follow Marinade Delegation Strategy' button
- 2.Click on 'See Filter Results'
- 3.Click on 'Save Selection Criteria'
- 4.Confirm the transaction on your wallet
Use the Marinade Delegation Strategy
Your stake accounts will be handled automatically and follow the Marinade delegation strategy, helping decentralize the network while providing a competitive APY.
Use customized criteria
If you want to customize your settings:
- 1.Toggle off the 'Follow Marinade Delegation Strategy' button
- 2.Choose a number of validators that you want to reach with your stake. Minimum value is 10 validators.
- 3.Choose the APY tiers that you would like to reach.
- 4.Choose the data concentration percentage over which validators should be excluded from your strategy.
- 5.Click on 'See results'
- 6.If your criteria reaches at least 10 validators, you can validate those criteria and apply them by clicking on 'Save Selection Criteria'
- 7.Validate the transaction
Both 'Exclude validators' option are informative and cannot be modified.
Basic criteria
Your stake accounts will now be handled according to the parameters you set.
Use advanced criteria
If you want to customize your settings further, you can use the 'Advanced settings'.
- 1.Toggle off the 'Follow Marinade Delegation Strategy' button
- 2.Click on "Show Advanced Settings'
- 3.Choose a number of validators that you want to reach with your stake. Minimum value is 10 validators.
- 4.Choose the APY tiers that you would like to reach.
- 5.Choose the data concentration percentage over which validators should be excluded from your strategy.
- 6.Select the Advanced Settings that you would like to add to your strategy between:
- 1.APY Range
- 2.Historical Validator Commission
- 3.Current Validator Commission
- 4.Validator Data Centers
- 5.Validator ASN
- 6.Active Stake Percentage (in %, compared to the whole network)
- 7.Active Stake (in SOL)
- 7.Once all your criteria are set, click on 'See Filter Results'. If your criteria reach at least 10 validators, you'll be able to validate them. If they don't reach enough validators, please go over your settings once again and set less restrictive ones.
- 8.Click on 'Save Selection Criteria'
- 9.Validate the transaction
Advanced Settings
Your stake accounts will now be handled and delegated to validators that fit your customized criteria.
The 'History' tab will allow you to monitor and understand all the actions taken by the bot in order to delegate your stake efficiently.
Remember that you always keep ownership of those stake accounts and you can choose to unstake them at any time.
Last modified 2d ago