Résumé
Binance Smart Chain lets you take advantage of DeFi’s borderless infrastructure with low fees. It works thanks to 21 validators - themselves supported by the community - who are responsible for processing all transactions, providing hardware and computing power, as well as maintaining network security. In return, they receive rewards via transaction fees and BNB staking.
Would you also like to contribute to the growth of BSC and be rewarded for it? Anyone with BNB can do this by staking their BNB as a delegator. Let's see what it's about and how to participate.
Introduction
Binance Smart Chain (BSC) is booming. Decentralized applications (DApps) like PancakeSwap, Venus, and many others are growing super fast. If you haven't tried interacting with the BSC ecosystem yet, you can start by reading our BSC Quick Start Guide.
Building such an ecosystem and its community of projects, infrastructure, developers, tools and users is not an easy task. This community aspect is what makes crypto so innovative, and what makes open source software a form of common good.
The Binance Smart Chain (BSC) is supported by numerous validators and delegators from its community, who can stake their BNB and be rewarded for it. If you are new to BSC or do not yet fully understand the role of validators and delegators, do not hesitate to consult our article: Journey to decentralization: Validators and Delegators.
The objective of validators from the community is to grow BSC into an increasingly large and accessible ecosystem. What does this mean, and how can you get involved?
What is a Binance Smart Chain (BSC) validator?
The Binance Smart Chain uses a consensus method called Proof of Staked Authority (PoSA). It is a hybrid consensus method combining Proof of Authority (PoA) and Delegated Proof of Stake (DPoS). This consensus model allows for rapid block generation and low fees, while only needing 21 validators to operate.
Validators take turns producing blocks. In practice, they are responsible for running the BSC network by processing all transactions and signing the blocks. In exchange for their services, they receive BNB tokens as a reward. At the same time, they must also be re-elected every day via the vote of users staking their BNB to continue to be part of the group of 21 validators.
What are the prerequisites to become a validator? A validator must run a hardware node meeting the defined technical specifications, operate a complete BSC node, and stake a minimum of 10,000 BNB. But that's not all. These prerequisites only allow you to become a candidate for the role of validator.
To begin truly validating blocks, a candidate validator must become an elected validator. The elected validators are the 21 best validator candidates, i.e. those with the largest share of votes. They change every 24 hours through a continuous election process, which can be observed using Binance.org's Top Validators list.
What is a Binance Smart Chain (BSC) Delegator?
Becoming a validator is not accessible to everyone, so how can you participate as a normal user?
It is possible to become a delegator and stake your BNB to support a validator candidate via one of the compatible wallets. By staking your BNB, you can choose your favorite validator and help it reach the minimum amount required by the protocol.
In fact, you then combine your BNB with those of your favorite validator in the same pool. As we have seen, validators receive their reward in the form of BNB. We also know that cryptocurrency networks are extremely effective at creating economic incentives. You probably guess where we're going with this: in exchange for their votes (via BNB staking), validators share part of their income with the delegators who support them. It's a win-win situation.
Delegators can also practice re-delegation. This means that they can transfer part of their staked BNB from one validator to another validator. Re-delegation is a good way to support multiple validators at the same time.
Delegators can also de-delegate their contribution. As you can imagine, this means they stop supporting the validator they were delegating their staked BNB to. Please note: the de-delegation requires 7 days to become effective, after which the delegator recovers the BNB he had staked. The delegator does not receive BNB as a reward during this period.
Should I become a Binance Smart Chain (BSC) delegator?
Well, the choice is yours. By becoming a delegator, you delegate your BNB contribution to your preferred validator. You also trust him to vote for you on all decisions associated with the governance of BSC. Wait... BNB also offers the right to participate in the governance of BSC? Of course. Validators can manage certain features of BSC, such as adjusting the gas price, changing certain system parameters or even blockchain updates.
By delegating your BNB, you also increase the share of rewards to which your validator is entitled. By joining forces, you are both rewarded. As of February 2021, each BSC validator received an average of 134 BNB per day in staking revenue. During the same period, the annual rate of return (APR) of BSC delegators was 60%.
However, although economic incentives are a great advantage and make the world go round, being a delegator is not just a matter of performance. By becoming a delegator, you directly support the operation and security of the BSC.
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How to become a Binance Smart Chain (BSC) validator
Let's say you've decided to aim high and become a BSC validator. What do you need to do?
To become a validator, you must meet three conditions:
Have the required equipment.
Spin up a full BSC node.
Stake at least 10,000 BNB.
This will allow you to appear on the list of validator candidates and potentially attract delegators ready to stake (delegate) their BNB with you.
In March 2021, the 21 elected validators each had more than 150,000 BNB staked, which is good competition to compete against (which is beneficial to the proper functioning of the network).
If you would like to learn more about the technical aspects of becoming a validator, feel free to read our BSC Validator Guide.
How to become a Binance Smart Chain (BSC) delegator
Becoming a delegator is probably the best choice if you don't want to delve into all the complex but necessary technical aspects of becoming a validator. If you own BNB, staking them and delegating this contribution to a validator is a simpler solution to support BSC and earn a return.
You can check out our guides on how to stake your BNB via the most popular wallets:
Binance Chain Wallet
Trust Wallet
MathWallet
Staking rewards are distributed to delegators every day at 00:00 UTC. When you delegate your contribution to a validator, you start accumulating rewards instantly.
What return can you expect? Let’s take the example of a popular validator, Ankr. As of March 2021, this validator generated 27% annual return. Not too bad. However, we must not forget that returns can fluctuate.
Conclusion
Whether you are a developer, a user, or simply excited about DeFi, there are many ways to help build the BSC ecosystem. As such, BNB staking is an excellent way for anyone to get involved in the BSC ecosystem and support the security and proper functioning of the network.
If you would like to learn more about BNB staking, do not hesitate to consult the Binance Chain documentation.
Do you have further questions about Binance Smart Chain validators and delegators? Check out our Q&A platform, Ask the Academy, where the Binance community will answer your questions.