megabyteBecome a Delegator in Graph Protocol on ARB
gm gm gm!!!
It's been a great journey so far with The Graph Protocol on Ethereum but to scale and to provide the benefits of its services to everyone The Graph Protocol is now shifting to Arbitrum One.
With this shift, many changes are coming for the community members, one of them is for Delegators.
If you are already a Delegator on the Ethereum Mainnet Network, head to this tutorial to shift your delegated GRT from Ethereum Mainnet to Arbitrum:
But before going through the whole process it's better to know about Delegators and things to consider before delegating.
Now LFG!!!!!!!🚀🚀🚀🚀🚀
WHO participates in Delegating?
People who delegate(or stake) are known as Delegators, and...
Delegators are network participants who stake GRT to one or more Indexers.
To learn about all the participants in The Graph Protocol, check this out:
Many community members are not able to run their own Graph Node because it requires high technical skills and resources, but they can still contribute to the security of the network by being a Delegator. They don't need to run their node and contribute to the security by staking GRT.
BENEFITS from Delegating
Upon staking or DELEGATING, they
earn fees by the cut from the Indexers' query Fees.
Contribute to the security of the network.
things to CONSIDER before Delegating
There are several things one should consider before starting delegating:
Delegation Tax
When you delegate GRT, 0.5% of the total gets burned.
For Example:
When you stake 100 GRT, 0.5 GRT will be burned.
This brings a bit of calculation to estimate the amount of time you need to wait to get back the Delegation Tax amount as a Reward Amount from the Indexer.
Unbounding Period
If you want to undelegate (unstake) your GRT you will be required to wait for 28 days. During these 28 days, your GRT will be locked and earning NO REWARDS.
Trustworthy Indexer
This is the most important thing to consider. YOU NEED TO CHOOSE YOUR INDEXER VERY WISELY.
There are two values you should look out for:
Indexing Rewards Cut: This value states the % of the rewards INDEXER will be keeping.
For Example:
If the Indexing Rewards Cut is 80% that means INDEXER will be keeping 80% of the reward, and DELEGATOR(YOU) will be getting 20% of the reward.
Query Fee Cut: This works exactly like the Indexing Rewards Cut ☝🏻 but there's one more thing to consider, Query Fee Rewards increase with time based upon the activity of the network.
Keep an eye on the network activity, more activity means more query rewards means more Query Fee Cut Rewards.
You can calculate your approximate rewards using the below formulas for getting the most out of the Indexers:
Indexer Delegation Pool
Every delegator owns the number of shares proportional to the GRT they delegated into the pool.
It's simple math, the more share you own more rewards you will be collecting than others.
Considering the delegation capacity
Currently, the Delegation Ratio is set to 16, which means if the Indexer has staked 1M GRT then the max capacity is 16M GRT.
Butttttt.... if users staked in a total of 18M GRT to this indexer, then the extra 2M (18M-16M) GRT will not be used for earning rewards.
oooooofff...😮💨 a lot of things to CONSIDERRRRR....😩
but remember: "Hard💪🏻 stuff brings the best rewards."
Let's have some action now!!
actually DELEGATING!
Now let's play with some GRT Tokens...
prerequisites
GRT either on Ethereum Mainnet or Arbitrum One
Native ETH on Arbitrum One.
Calculator 😂 (It's for you I am good at math 😏)
getting GRT on ARB
if you have GRT on ARB already, congrats! You are one step ahead and can move to the next section.
For those who don't have GRT on ARB, let's experience some true web3 UX 😜
bridging ETH from Ethereum Mainnet to Arbitrum One
To get your GRT from Ethereum Mainnet to Arbitrum One you need to bridge it, and for that follow the steps:
Head to the Official Arbitrum Bridge (https://bridge.arbitrum.io/)
Connect your wallet and select GRT, Ethereum Mainnet (FROM) and Arbitrum ONE (TO).
Enter the amount of GRT you want to bridge.
Click on "Move funds to Arbitrum One" and approve and confirm the transaction.
Now wait!!!
After tremendous anxiety full waiting, you are ready to delegate.
choosing and analyzing the INDEXER
To earn with full potential Indexers need to be transparent and honest, this will help you and other Delegators in analyzing and calculating their true rewards.
Follow these steps:
Head to Indexers on Arbitrum Network in the Graph Explorer (https://thegraph.com/explorer/participants/indexers?chain=arbitrum-one)
Connect your wallet and sign in to The Graph Explorer.
1st thing to consider is to choose an Indexer from both tech and non-technical perspectives.
⚠NOTE: I am choosing some random. [YOU ARE NOT AT ALL ADVISED TO CHOOSE THE SAME]
Analyzing the factors:
From the above image, we have the following parameters:
Max Capacity: 3.4M and Delegation Received: 1.6M
This means only 1.8M [3.4-1.6] tokens will earn rewards.Indexing Reward Cut: 27%
This means you [Delegators] will receive only 73% of the Indexing Reward.Query Fee Cut: 80%
This means you [Delegators] will receive only 20% of the Query Fee Reward.
final steps!!
I am fine with the amount I'll be receiving, so I'll be following these steps:
click on "Delegate"
enter the amount of GRT I want to delegate(stake), i.e., 1000.
grant Access to the GRT tokens
hit "DELEGATE"
Congrats 🥳🥳🥳 You have Delegated GRT and now you are contributing to the security💪🏻 of the network while earning rewards!💰!
You can see your delegated amount and other details by clicking on your profile and selecting the delegating tab.
References
If you learned something from this blog, do consider sharing your learnings with me through DM either on Twitter or LinkedIn or Lenster.
To keep learning about The Graph Protocol join me with The Graph Protocol India.
Happy Learning 🙌🏻
Keep BUIDLing 🧱🚀