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Orchai Liquid Staking applies an artificial intelligence model to choose the best validators from the Oraichain ecosystem. This method utilizes a validator scoring algorithm to maximize user returns while maintaining that funds are delegated equally throughout the network validators. While selecting top network validators, the program focuses three important factors:
The APR earned by delegating to validators on Oraichain depends on Commission Rate. We prioritize validators who charge a low commission, ensuring that a larger portion of staking rewards goes to users.
When staking to validators on Oraichain, users run the risk of being slashed but if a validator they’re staking to is slashed or jailed. With this in mind, Orchai Liquid Staking considers the following metrics while selecting our validator set:
Slashing results in the jailing of a validator, meaning the user needs to proactively unstake and restake to another validator. In this case alone, the user would lose a minimum of a week’s worth of rewards. This is why we select validators with the minimum number of slashing instances over the past year.
This is a key metric to ensure that the validator doesn’t miss block production (also rewards). We use validator uptime figures from the past 6 months to determine the most consistent network validators.
Oraichain's network relies on decentralization for Proof Of Stake to work. The way Oraichain processes and approves transactions relies on stakes being spread across a wide range of validators. The more diverse and decentralized stakes are, the better for the health of the network overall. There is a risk inherent in everyone choosing the most popular validator to stake their coins with: if the majority of coins end up staked with a small number of validators it can lead to a network halt, where inbuilt protections on the integrity of transactions stop working. Instead, for the sake of the network, it makes sense to spread stakes out across a far greater number of validators to prevent the likelihood of a halt or intentional attack.
To enhance the chain's decentralization, Orchai Liquid Staking will distribute stakes to small validators. However, top-ranked validators will not be excluded. This is because some top-ranked validators do a lot for the ecosystem, and deserve delegations.
ORAI tokens are assigned to validators depending on their composite score. In the early stages, this score is calculated and predicted by a machine-learning model off-chain. In future versions, we’ll automate this validator this process by taking the scoring mechanism on-chain by using Orai AI Oracle.