# Staking Module

The Staking module is used to manage funds at stake by network maintainers.

- [`staking::Config`](https://docs.rs/pallet-staking/latest/pallet_staking/trait.Config.html)
- [`Call`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html)
- [`Module`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.Module.html)

## Overview

The Staking module is the means by which a set of network maintainers (known as _authorities_ in some contexts and
_validators_ in others) are chosen based upon those who voluntarily place funds under deposit. Under deposit, those
funds are rewarded under normal operation but are held at pain of _slash_ (expropriation) should the staked maintainer
be found not to be discharging its duties properly.

### Terminology

<!-- Original author of paragraph: @gavofyork -->

- Staking: The process of locking up funds for some time, placing them at risk of slashing (loss) in order to become a
  rewarded maintainer of the network.
- Validating: The process of running a node to actively maintain the network, either by producing blocks or guaranteeing
  finality of the chain.
- Nominating: The process of placing staked funds behind one or more validators in order to share in any reward, and
  punishment, they take.
- Stash account: The account holding an owner's funds used for staking.
- Controller account (being deprecated): The account that controls an owner's funds for staking.
- Era: A (whole) number of sessions, which is the period that the validator set (and each validator's active nominator
  set) is recalculated and where rewards are paid out.
- Slash: The punishment of a staker by reducing its funds.

### Goals

<!-- Original author of paragraph: @gavofyork -->

The staking system in Substrate NPoS is designed to make the following possible:

- Stake funds that are controlled by a cold wallet.
- Withdraw some, or deposit more, funds without interrupting the role of an entity.
- Switch between roles (nominator, validator, idle) with minimal overhead.

### Scenarios

#### Staking

Almost any interaction with the Staking module requires a process of _**bonding**_ (also known as being a _staker_). To
become *bonded*, a fund-holding account known as the _stash account_, which holds some or all of the funds that become
frozen in place as part of the staking process. The controller account, which this pallet now assigns the stash account to,
issues instructions on how funds shall be used.

An account can become a bonded stash account using the
[`bond`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.bond) call.

Stash accounts can update their associated controller back to their stash account using the
[`set_controller`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.set_controller) call.

Note: Controller accounts are being deprecated in favor of proxy accounts, so it is no longer possible to set a unique
address for a stash's controller.

There are three possible roles that any staked account pair can be in: `Validator`, `Nominator` and `Idle` (defined in
[`StakerStatus`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.StakerStatus.html)). There are three
corresponding instructions to change between roles, namely:
[`validate`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.validate),
[`nominate`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.nominate), and
[`chill`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.chill).

#### Validating

A **validator** takes the role of either validating blocks or ensuring their finality, maintaining the veracity of the
network. A validator should avoid both any sort of malicious misbehavior and going offline. Bonded accounts that state
interest in being a validator do NOT get immediately chosen as a validator. Instead, they are declared as a _candidate_
and they _might_ get elected at the _next era_ as a validator. The result of the election is determined by nominators
and their votes.

An account can become a validator candidate via the
[`validate`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.validate) call.

#### Nomination

A **nominator** does not take any _direct_ role in maintaining the network, instead, it votes on a set of validators to
be elected. Once interest in nomination is stated by an account, it takes effect at the next election round. The funds
in the nominator's stash account indicate the _weight_ of its vote. Both the rewards and any punishment that a validator
earns are shared between the validator and its nominators. This rule incentivizes the nominators to NOT vote for the
misbehaving/offline validators as much as possible, simply because the nominators will also lose funds if they vote
poorly.

An account can become a nominator via the
[`nominate`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.nominate) call.

#### Rewards and Slash

The **reward and slashing** procedure is the core of the Staking module, attempting to _embrace valid behavior_ while
_punishing any misbehavior or lack of availability_.

Rewards must be claimed for each era before it gets too old by `$HISTORY_DEPTH` using the `payout_stakers` call. When a
validator has more than [`Config::MaxExposurePageSize`] nominators, nominators are divided into pages with each call to
`payout_stakers` paying rewards to one page of nominators in a sequential and ascending manner. Any account can also
call `payout_stakers_by_page` to explicitly pay reward for a given page. As evident, this means only the
[`Config::MaxExposurePageSize`] nominators are rewarded per call. This is to limit the i/o cost to mutate storage for
each nominator's account.

Slashing can occur at any point in time, once misbehavior is reported. Once slashing is determined, a value is deducted
from the balance of the validator and all the nominators who voted for this validator (values are deducted from the
_stash_ account of the slashed entity).

Slashing logic is further described in the documentation of the `slashing` module.

Similar to slashing, rewards are also shared among a validator and its associated nominators. Yet, the reward funds are
not always transferred to the stash account and can be configured. See [Reward
Calculation](https://docs.rs/pallet-staking/latest/pallet_staking/#reward-calculation) for more details.

#### Chilling

Finally, any of the roles above can choose to step back temporarily and just chill for a while. This means that if they
are a nominator, they will not be considered as voters anymore and if they are validators, they will no longer be a
candidate for the next election.

An account can step back via the
[`chill`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.chill) call.

### Session managing

The module implement the trait `SessionManager`. Which is the only API to query new validator set and allowing these
validator set to be rewarded once their era is ended.

## Interface

### Dispatchable Functions

The dispatchable functions of the Staking module enable the steps needed for entities to accept and change their role,
alongside some helper functions to get/set the metadata of the module.

### Public Functions

The Staking module contains many public storage items and (im)mutable functions.

## Usage

### Example: Rewarding a validator by id

```rust
use pallet_staking::{self as staking};

#[frame_support::pallet]
pub mod pallet {
    use super::*;
    use frame_support::pallet_prelude::*;
    use frame_system::pallet_prelude::*;

    #[pallet::pallet]
    pub struct Pallet<T>(_);

    #[pallet::config]
    pub trait Config: frame_system::Config + staking::Config {}

    #[pallet::call]
    impl<T: Config> Pallet<T> {
        /// Reward a validator.
        #[pallet::weight(0)]
        pub fn reward_myself(origin: OriginFor<T>) -> DispatchResult {
            let reported = ensure_signed(origin)?;
            <staking::Pallet<T>>::reward_by_ids(vec![(reported, 10)]);
            Ok(())
        }
    }
}
```

## Implementation Details

### Era payout

The era payout is computed using yearly inflation curve defined at
[`T::RewardCurve`](https://docs.rs/pallet-staking/latest/pallet_staking/trait.Config.html#associatedtype.RewardCurve) as
such:

```nocompile
staker_payout = yearly_inflation(npos_token_staked / total_tokens) * total_tokens / era_per_year
```

This payout is used to reward stakers as defined in next section

```nocompile
remaining_payout = max_yearly_inflation * total_tokens / era_per_year - staker_payout
```

The remaining reward is send to the configurable end-point
[`T::RewardRemainder`](https://docs.rs/pallet-staking/latest/pallet_staking/trait.Config.html#associatedtype.RewardRemainder).

### Reward Calculation

Validators and nominators are rewarded at the end of each era. The total reward of an era is calculated using the era
duration and the staking rate (the total amount of tokens staked by nominators and validators, divided by the total
token supply). It aims to incentivize toward a defined staking rate. The full specification can be found
[here](https://research.web3.foundation/en/latest/polkadot/economics/1-token-economics.html#inflation-model).

Total reward is split among validators and their nominators depending on the number of points they received during the
era. Points are added to a validator using
[`reward_by_ids`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.reward_by_ids) or
[`reward_by_indices`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.reward_by_indices).

[`Module`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.Module.html) implements
[`pallet_authorship::EventHandler`](https://docs.rs/pallet-authorship/latest/pallet_authorship/trait.EventHandler.html)
to add reward points to block producer and block producer of referenced uncles.

The validator and its nominator split their reward as following:

The validator can declare an amount, named
[`commission`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.ValidatorPrefs.html#structfield.commission),
that does not get shared with the nominators at each reward payout through its
[`ValidatorPrefs`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.ValidatorPrefs.html). This value gets
deducted from the total reward that is paid to the validator and its nominators. The remaining portion is split among
the validator and all of the nominators that nominated the validator, proportional to the value staked behind this
validator (_i.e._ dividing the
[`own`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.Exposure.html#structfield.own) or
[`others`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.Exposure.html#structfield.others) by
[`total`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.Exposure.html#structfield.total) in
[`Exposure`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.Exposure.html)).

All entities who receive a reward have the option to choose their reward destination through the
[`Payee`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.Payee.html) storage item (see
[`set_payee`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.set_payee)), to be one of the
following:

- Controller account, (obviously) not increasing the staked value.
- Stash account, not increasing the staked value.
- Stash account, also increasing the staked value.

### Additional Fund Management Operations

Any funds already placed into stash can be the target of the following operations:

The controller account can free a portion (or all) of the funds using the
[`unbond`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.unbond) call. Note that the
funds are not immediately accessible. Instead, a duration denoted by
[`BondingDuration`](https://docs.rs/pallet-staking/latest/pallet_staking/trait.Config.html#associatedtype.BondingDuration)
(in number of eras) must pass until the funds can actually be removed. Once the `BondingDuration` is over, the
[`withdraw_unbonded`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.withdraw_unbonded)
call can be used to actually withdraw the funds.

Note that there is a limitation to the number of fund-chunks that can be scheduled to be unlocked in the future via
[`unbond`](https://docs.rs/pallet-staking/latest/pallet_staking/enum.Call.html#variant.unbond). In case this maximum
(`MAX_UNLOCKING_CHUNKS`) is reached, the bonded account _must_ first wait until a successful call to `withdraw_unbonded`
to remove some of the chunks.

### Election Algorithm

The current election algorithm is implemented based on Phragmén. The reference implementation can be found
[here](https://github.com/w3f/consensus/tree/master/NPoS).

The election algorithm, aside from electing the validators with the most stake value and votes, tries to divide the
nominator votes among candidates in an equal manner. To further assure this, an optional post-processing can be applied
that iteratively normalizes the nominator staked values until the total difference among votes of a particular nominator
are less than a threshold.

## GenesisConfig

The Staking module depends on the
[`GenesisConfig`](https://docs.rs/pallet-staking/latest/pallet_staking/struct.GenesisConfig.html). The `GenesisConfig`
is optional and allow to set some initial stakers.

## Related Modules

- [Balances](https://docs.rs/pallet-balances/latest/pallet_balances/): Used to manage values at stake.
- [Session](https://docs.rs/pallet-session/latest/pallet_session/): Used to manage sessions. Also, a list of new
  validators is stored in the Session module's `Validators` at the end of each era.

License: Apache-2.0
