Proof of Stewardship

A validator's influence is proportional to the amount of the network's native token they have staked (locked) as collateral. This creates a direct financial incentive for honest behavior, as malicious actions can lead to slashing (loss of stake). Unlike pure Proof of Stake, selection often incorporates additional reputation metrics.

The protocol maintains a reputation score for each validator based on historical performance metrics, such as:

• Uptime and proposal reliability
• Historical accuracy of attestations
• Absence of slashing penalties This score directly influences the probability of being selected to propose or validate new blocks.

The active set of validators is not static. It is periodically refreshed based on the latest stake amounts and reputation scores. This mechanism prevents centralization, encourages continuous performance, and allows for the graceful removal of underperforming or offline validators from the active duty roster.

To secure the network, Proof of Stewardship defines clear slashing conditions for malicious or negligent behavior, such as double-signing blocks or extended downtime. Penalties typically involve the partial or total confiscation of the validator's stake, which is then often burned or redistributed to honest participants.

Token holders who do not run validator nodes can delegate their stake to professional validators. This pools security, allows for broader participation in consensus, and enables delegators to earn rewards. The validator's reputation score is critical for attracting delegation.

By forgoing computationally intensive mining puzzles, Proof of Stewardship is vastly more energy-efficient than Proof of Work. Consensus is achieved through cryptographic signatures and voting among known, staked validators, reducing the network's environmental footprint to that of running standard servers.

The core innovation is the time-lock, where stakers commit their tokens for a fixed duration. Longer lock-ups grant higher voting power and rewards, directly incentivizing long-term alignment. This creates a sybil-resistant validator set, as acquiring significant influence requires a substantial, illiquid commitment of both capital and time.

By weighting influence based on stake duration, PoSx makes long-range attacks and validator cartels more expensive and difficult to form. An attacker cannot simply acquire tokens to attack; they must also wait through the lock-up period, during which the attack can be detected and slashed. This provides a crypto-economic security model focused on persistent commitment.

Unlike DPoS, where a small number of elected validators hold power, PoSx aims for a more decentralized and stable validator set. There is no competitive voting for slots; influence is earned through demonstrable, long-term stake commitment. This reduces the whale dominance and political campaigning seen in some DPoS systems.

The protocol designs staking rewards to be super-linear with lock-up time, meaning rewards increase more than proportionally for longer commitments. This creates a powerful incentive for HODLing and reduces sell-side pressure. The model also introduces novel slashing conditions for early unbonding, penalizing short-term speculation.

PoSx is particularly suited for securing light client protocols and cross-chain bridges, where validator reliability over time is critical. A validator with a multi-year time-lock is economically bound to act honestly, making them a more trustworthy party for verifying state proofs from other chains, reducing bridge hack risks.

The fundamental mechanism where a validator's influence is a function of both the amount and the duration of their staked assets. Stakes are locked for a predetermined period, creating a cryptoeconomic bond that aligns long-term incentives with network security. This contrasts with models where voting power is purely proportional to stake size.

A validator's probability of being chosen to propose or validate a block is weighted by their time-weighted stake. For example, 100 tokens locked for 2 years may confer more power than 200 tokens locked for 6 months. This algorithmically prioritizes participants with deeper, long-term skin in the game.

Penalties for malicious behavior (slashing) are often enhanced in PoS systems. A validator attempting an attack not only risks their staked principal but also forfeits the accrued time premium. This creates a progressively increasing cost to dishonesty, strengthening crypto-economic security over time.

Key differentiators from standard PoS:

• PoS: Influence = Stake Amount.
• Proof of Stewardship: Influence = Stake Amount × Time. This shift aims to reduce short-term speculative validation, mitigate nothing-at-stake problems for long-range attacks, and promote network stability by rewarding commitment.

Potential trade-offs include:

• Reduced Liquidity: Capital is locked for extended periods.
• Barrier to Entry: New participants lack the 'time credit' of early adopters.
• Complexity: More intricate reward and penalty calculations than vanilla PoS. These factors require careful mechanism design to balance security with accessibility.