Guide

Current ROS: Big pools vs. small pools [UPDATE]

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Hey people,

In this article I do want to talk a little bit about the current return of stake (ROS) and how the ROS of small pools compares to the ROS of bigger pools. I guess some of you will be surprised and I really hope some of you will think about their current delegation and consider delegating to smaller pools.

As we do have some first data now, we can actually start to do some calculations. Yes, there will be some changes over time and as I’m no fortune teller, I will only look at the data we have at hand:

I am using the data from https://pooltool.io/ as they already provide information about the ROS of pools. So lets clarify what the ROS is: it basically tells you how much return you will get of your invested stake in one year. E.g. if you have 100k ADA and you delegate your stake to a pool which has a ROS of 5% you’ll have 105k ADA at the end of the first year.

So let us compare the average ROS of the top 20 pools (without saturated ones) to the ROS of the pools on the rank 200 – 220:

Calculation for top 20 (without saturated pools):

5.77 + 5.86 + 5.81 + 5.80 + 5.77 + 5.59 + 5.77 + 5.78 + 5.77 + 5.77 + 5.37 + 5.48 + 5.6 + 5.83 + 5.49 + 5.48 + 5.59 + 5.74 + 5.37 + 5.48 = 113.12 / 20 = 5.656%

Calculation for rank 200 – 220 (with at least one block):

5.89 + 5.82 + 5.82 + 6.55 + 0 + 6.16 + 6.32 + 5.77 + 7.15 + 6.02 + 4.08 + 5.78 + 5.96 + 5.91 + 5.83 + 6.64 + 5.78 + 7.04 + 6.53 + 6.91= 115.96 / 20 = 5.798%

Notes: Pools sorted by lifetime blocks; for comparison: Avg. stake of the top20-set: 144M; Avg. stake of the smaller-set: 6M

As you can see the ROS of the much much larger pools is not even higher than the ROS of the smaller pools. In fact, in this example, its the other way around the smaller pools gave you a 0.142% higher ROS. So what does this mean for you as a delegator: It is not really important if you stake with a very large pool or with a medium-sized or a small pool when you only consider the ROS. But I think many of us know that the ~5% per year are only a nice bonus and the tip of the iceberg. If Cardano succeeds in its vision it has a much higher potential than those gains. For Cardano to succeed we need a healthy, diverse ecosystem with as many reliable pools as possible and we will only reach this with true decentralization on which you as delegators can have a direct influence.

So please reconsider delegating to smaller pools, think about what it means for Cardano when the stake is to concentrated to big pools and what it means when there are stake pool operators that are obviously running more than a few pools at once to attract more and more stake and delegators.

I hope this was a helpful little comparison for some of you. Remember that this was just an example, there will always be a certain luck factor but in the end we will be on about the same level with ROS.

For everyone who already delegates to this pool or thinks about delegating: This pool has currently a ROS of 5.79%

Thanks to every single delegator, without you the operation of this pool would not be possible.

Talk to you soon! 🙂



[UPDATE 31st August 2020]:

As some people mentioned, the given ROS values by pooltool are not 100% correct as they seem a bit of of the real values when calculated for a single delegator. The overall numbers seem to high throughout all pools. This means that the ROS values are not correct in their absolute numbers but the ratio of the numbers should be correct. I’ll do a similiar post like this in some time when we have better data 🙂

Some information about rewards

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Hey people!

I received several message from delegators reaching out to me, asking when and how often they will receive rewards and I wanted to clarify this for everyone here:

We’re currently in epoch 213 (23-28 August). At the beginning of 213 the first rewards were distributed. Those came from epoch 211 (13-18 August) which was the first epoch were blocks could have been produced.

Statistically we should have made about 1.5 Blocks in 211. But there is a certain randomness within the algorithm. So we were unlucky and weren’t assigned to a block. This has nothing to do with poor performance of the pool as we were up and running all the time. Therefore there are unfortunately no rewards yet.

But the good message is: We produced 2 blocks in epoch 212 so you will receive rewards for that at the beginning of the upcoming epoch 214 (28 August)! 🙂

Rewards are distributed completely automatically and you will find them in your wallet. Assuming we are able to produce a block every epoch, you will also receive rewards every epoch, so every 5 days.

Please take a short look at the “Reward Schedule until EOY” for further explanation if you’re interested.

Please note that the blocks assigned to pools are determined by an algorithm which is statistically based. So you will see that the whole system levels out over a longer period of time. That means, that we may not produce our expected blocks in one epoch but then exceed the expected blocks in another epoch. Over a longer time frame it will be the same as consistently making the same amount of blocks.

Thanks for staying with me. Smaller pools really need every delegator! Trying my best to attract some more people to the pool.

Talk to you soon! 🙂

Staking with Yoroi

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Today there are some great news for you people: The Yoroi extension is finally ready for Shelley including Ledger and Trezor support!

Initial Setup

Let us take a closer look at the delegation process:

  • Please make sure, that you’re using the current version of Yoroi and downloaded it directly through the chrome web store you will find the link here: https://yoroi-wallet.com/#/
  • Please also make sure that you’re using an up-to-date hardware wallet if you are using one
  • Click on “Add” and confirm the operation with “Add extension”
  • Select your language and press “Continue”
  • Read and accept the terms of use
  • Now you can choose the level of complexity: for this guide I am staying with the simple view
  • You can now decide whether to enable Cardano payment URLs or not. It’s up to you.
  • You have now worked your way through the initial setup. This process is only needed when you first install the Yoroi extension. In the next Section you’ll find the instructions on how you can add a wallet to Yoroi.

Adding a wallet

  • We’re finally able now to connect our hardware wallet, restore a wallet or to create a new one. Just choose what you want, Yoroi will guide you through the corresponding steps. As they are explained very good within Yoroi I will not cover them all.
  • If you do already have a Byron wallet, you just create a new Shelley wallet and send your funds from your Byron to your Shelley wallet. This is necessary as staking is only possible from a Shelley wallet. I’ll explain it in more detailed later.
  • I’ll show you the process of connecting your Ledger Hardware Wallet. So we choose “Connect to hardware wallet”, then select “Cardano” and afterwards choose “Ledger Hardware Wallet”
  • Then you need to select which type of wallet you do want to restore.
  • If you never used your Ledger after the Shelley hardfork you first need to choose the Byron-era wallet here. In a later stage you should then be prompted to automatically transfer your funds to your Shelley wallet. If not contact the section: Transition from Byron to Shelley
  • Read the instructions here carefully and make sure that all prerequisites are in place, then press “Next”
  • Connect your ledger to your computer, unlock it, open the cardano app and click “Connect”.
  • A new tab will open where you need to choose your specific device.
  • You now need to export your public key when prompted on your ledger device. Please note, that this request may happen twice, just export your public key both times. Afterwards you should be able to name your wallet.
  • If you restored a Byron-era wallet you’ll need to send the funds from it to a Shelley-era wallet. As mentioned earlier you can just go through this process again to add a Shelley-era wallet.

Tansition from Byron to Shelley

As stated before: Staking is only available when you are on a Shelley wallet. The process of going from Byron to Shelley is basically only a single transaction where you send all your funds from your Byron to your Shelley wallet.

This is the manual way of going from a Byron to a Shelley wallet. I already talked to the developers of Yoroi and they said, that you should be automatically prompted on Ledger devices to transfer the funds automatically. For any other wallet type you can do it either via the the “Claim / Transfer” page or follow this guide and transfer the funds over manually. No matter which method you choose, the result is always the same.

Prerequisites: You need the Yoroi Extension with your old Byron wallet and a new Shelley wallet already added. It is described in the sections before how you can add new wallets to Yoroi.

  1. Open your Shelley wallet and copy the receiving address which can be found in the “Receive” tab

2. Switch to your Byron wallet and send all your funds to the copied receiving address of your Shelley wallet

After confirming the transactions you should see your funds in your Shelley wallet within a few minutes. Congratulations you switched from Byron-era wallet to Shelley-era wallet. You can now go on to the next section: Staking

Staking

If you restored a Shelely-era wallet you will find yourself in a view like this. Switch to the delegation tab here, where you’ll be able to stake your ADA.

  • You can now enter the Stake Pool ID to which you want to delegate. If I helped you with this guide, you are very welcome to use my pool: 6b51a5aae5b4b5f07f38acf12816b4f8a558ee2840d0dba69040aeb2
    You also have the advantage of very low fees of 0.5% and therefore get higher rewards than in other pools. You will also see some information about the pool and can complete the process by clicking the “Next” button.
    If you rather want to stake to another pool, just work your way through any of those explorers:
  • This is the final confirmation of your transaction. Insert your spending password and click “Delegate”. Your paying a fee of about 2.17 ADA, this splits up in 2 ADA for the first time your registering your stake address on the blockchain. This is a one time fee, which will prevent attackers from flooding the network with a huge amount of fake stake addresses and fake delegations. The remaining ~0.17 ADA are the current transaction fees.
  • Note: Hardware wallet users will do this confirmation directly on their device!
  • Congratulations, you’ve done it and successfully delegated to a stake pool.
  • If you switch over to the “Dashboard” tab you’ll be able to see your “Total Delegated” ADA, as well as the Stake Pool to which you are currently delegating. You do also have the information about upcoming rewards and will also see the rewards you earned once they are distributed in epoch 213 and the following ones.

Ledger Troubleshooting

Some people experiencing problems when trying to connect their Ledger to Yoroi. Here is some troubleshooting advice:

  • First make sure that its really not working with your current setup. Sometimes it helps when you try it a few times.
  • Check if your Ledger runs the latest firmware, if not update:
  • Check if the Cardano application on your Ledger is up-to-date (sometimes Ledger Live does not show an Update for certain Apps even if there is one; my advice: just uninstall and then reinstall the Cardano app)
  • Use a current version of Chrome with the Yoroi extension as this is the only supported setup
  • If you have installed more than more version of Yoroi (e.g. the testnet version) make sure to deactivate the one you’re currently not using, as they can intefere with each other
  • Check the Permissions of the Yoroi extension: Right click on the Yoroi icon -> Manage extension -> Check the “Site access” permissions, they should be granted for “*://connect.trezor.io/*” and “https://emurgo.github.io/*”
  • If it still does not work, try reinstalling Chrome as well as the Yoroi extension
  • There is also a FAQ video directly from EMURGO (the developers of Yoroi), which may help you with some questions:
https://www.youtube.com/watch?v=j8Iy4O2hzVY

Thanks for following me through this guide. If you have any questions don’t hesitate to contact me. I wish you happy staking! Talk to you soon 🙂

Staking with adalite.io and Ledger / Trezor

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After Cardano has successfully entered the Shelley era, it is time to talk about staking. In particular about staking with a hardware wallet from Ledger or Trezor. Adalite.io was the first provider where you can easily stake directly with your hardware wallet and keep your keys safe.

The process itself is really simple, but we need to make sure that all prerequsities are fulfilled. Please make sure that your Ledger is initialized and its firmware as well as its Cardano app is up to date, by checking it in Ledger Live. Trezor Users also need to make sure that their firmware is up to date.

  • Go to adalite.io
  • Choose the option Hardware Wallet
  • Connect your Hardware Wallet, Ledger users need to enter the PIN and open the Cardano app.
  • Select Unlock with the device of your choice.
  • Follow the procedure to export your public key (this request will happen twice on the ledger)
  • Now you see a staking balance and a non-staking balance, here you need to select convert to stakable
  • Check and confirm the transaction on your device. What’s happening here: Your ADA from your Legacy Byron Wallet will be transferred to your Shelley Wallet for staking. The receiving address is the one with the index /0 in AdaLite on the Sending tab under My Addresses. Make sure it matches with the address shown by your ledger.
  • You can now enter your Stake Pool directly on the right side. If I helped you with this little guide, you are welcome to use my pool: 6b51a5aae5b4b5f07f38acf12816b4f8a558ee2840d0dba69040aeb2
    You also have the advantage of very low fees of 0.5% and therefore get higher rewards than in other pools. You will see the information about the pool and can complete the process by clicking the Delegate button.
    If you rather want to stake with another pool you can check them out at adapools.org, cardanoscan.io or pooltool.io
  • Check and confirm the delegation on your device.

If everything worked adalite will now display your current delegation.

Congratulations, you are now a stakeholder and will soon receive your first rewards.