TL;DR
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Full Story
Starting December 20, 2024, we will be implementing phased changes to the Validator Support Program in light of recent improvements in validator rewards, including the introduction of a minimum wage through the implementation of ICON Economic Policy (IISS) 4.0. Initially launched to support validators during a challenging period, the Validator Support Program will now shift so that funds currently allocated to the program can be redirected towards liquidity incentives, aligning with ICON’s economic enshrinement model.
Specifically, these funds will be used to support liquidity on Balanced, encouraging validators, bonders, and stakers to participate. This shift aims to enhance network revenue and increase ICX burn, further contributing to ICON’s long-term growth and sustainability.
Key Changes Overview
Over the next three months, we will introduce phased reductions in both the bond requirement and maximum delegation. These adjustments are designed to improve capital efficiency for validators while aligning their interests with ICON’s economic goals. Validators are strongly encouraged to stake ICX freed from the reduced bond requirement into a new ICX/sICX liquidity pool on Balanced, which will be incentivized by the ICON Foundation.
Please note that the dates and figures shared below may be adjusted based on ongoing assessments of market impact.
Also, please note that the following restrictions will apply to validators participating in the Validator Support Program:
No additional rewards will be issued for over-bonding.
Delegation will be limited to one node per entity.
The ICON Foundation reserves the right to deny delegation to any participant.
How it Will Work
The ICON Foundation will redirect delegation freed up by changes to the Validator Support Program into a dedicated node that supports a new ICX/sICX liquidity pool on Balanced. This node will operate at a 100% commission rate, using all staking rewards to incentivize the new ICX/sICX pool.
Please note that delegators will not receive rewards for voting for this node.
To earn rewards, users simply need to supply liquidity to the ICX/sICX pool and claim their incentives from the Balanced application, just as they would for any other pool. The ICX/sICX pool will be launched soon on Balanced, replacing the existing ICX/sICX queue-based instant unstaking mechanism, which will be phased out due to high costs and inefficiency.
For any questions, please reach out through our Discord.