Polkadot

Lido on Polkadot Onboarding Process

Lido on Polkadot, developed in collaboration with MixBytes, is a liquid staking solution for DOT.

Unlike many of the other Lido staking protocols, validators for Polkadot and it’s canary network Kusama are not chosen through a permissioned set, but through an algorithm that selects operators based off of chain-based performance that maximizes APR.

The gathered and calculated data for each validator and era consists of:

This gathered data is aggregated and used to build several metrics for different time periods:

Then the scoring model considers dynamical changes of validators' performance, e.g.:

• Operational data lets us detect oversubscribing, fees increase and slashing.
• Short-term data will show us if some relatively good validator in the long-term goes down or starts to lack in performance.
• Mid- and long-term data will hedge us from choosing validators who show good performance in the short-term but might be unstable in the long run.

APR maximization mechanics are based on validator scores as described above. For more information about the process and selection algorithm read more:

Lido liquid staking for Kusama upgrades to the uncapped Second Stage

Validators in the Kusama relay chain might be slashed due to different reasons starting from unavailability to double signing. Lido should minimize that risk despite slashing occurring rarely. Our hedging strategy is based on stake diversification, which means we distribute pooled stake to several nominators or staking ledgers.

mixbytes.io

https://blog.lido.fi/lido-on-polkadot/

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