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Overview

BNB Smart Chain is an innovative solution to bring programmability and interoperability to BNB Beacon Chain. BNB Smart Chain relies on a system of 56 validators with Proof of Staked Authority (PoSA) consensus that can support short block time and lower fees. The most bonded validator candidates of staking will become validators and produce blocks. The double-sign detection and other slashing logic guarantee security, stability, and chain finality.

Other than the 40 active validators (21 Cabinets and 19 Candidates), BSC will introduce more validators, e.g. another 16 inactive validators, into the validator set as backups, which will be called “Candidates”.

Candidates will produce blocks and charge gas fees in BSC mainnet, but in a much less chance than the official validator set of 40 elected. The unavailable candidates will be slashed as well though in a smaller size. A decent motivation is expected to be maintained so that the candidate validators are willing to ensure the quality and help secure BSC.

In an extreme case, if a majority of the active 40 validators (21 Cabinets and 19 Candidates) get attacked and offline, Candidate Validators can report to BNB Beacon Chain about the stale blocking, resume it and eventually propose a re-election of active validator set.

What is Validator?​

BNB Smart Chain relies on a set of validators who are responsible for committing new blocks in the blockchain. These validators participate in the consensus protocol by signing blocks that contain cryptographic signatures signed by each validator's private key. The validator set is determined by a staking module built on BNB Beacon Chain for BNB Smart Chain, and propagated every day 00:00 UTC from BC to BSC via Cross-Chain communication.

Economics​

Validator's rewards come from transaction fees and commission fees from delegators.

Let us also assume that the reward for a block is 100 BNB and that a certain validator has 20% of self-bonded BNB and sets its commission rate to 20%. These tokens do not go directly to the proposer. Instead, they are shared among validators and delegators. These 100 BNB will be distributed according to each participant's stake:

Commission: 80*20%= 16 BNB
Validator gets: 100\*20% + Commission = 36 BNB
All delegators get: 100\*80% - Commission = 64 BNB

The rewards for motivating validators to vote for Fast Finality also comes from transaction fees. The specific rules can refer to BEP126

If validators double sign, malicious vote or frequently offline, their staked BNB (not including BNB of users that delegated to them) can be slashed. The penalty depends on the severity of the violation.

You can learn to see the revenue history from BitQuery's chart or a table of BscScan

Risks for Validators​

If you try to cheat the system, or act contrary to the specification, you will be liable to incur a penalty, known as slashing.

Potential Loss​

Loss for Double-Sign Slash​

Running your validator keys simultaneously on two or more machines will result in Double-Sign slashing.

Penalty for Double-Sign Slash​
  1. 10000 staked BNB will be slashed for the validator.
  2. The Double-Sign Jail time is 2^63-1 seconds, which means the candidate cannot become a validator anymore.

Note: Rewards for submitting double-sign evidence: 1000BNB Anyone can submit a slashing request on BC with the evidence of Double Sign of BSC, which should contain the 2 block headers with the same height and parent block, sealed by the offending validator.

Loss for Malicious Vote Slash​

Running your validators with the same consensus keys and voting keys concurrently on two or more machines will result in Malicious Vote slashing.

Penalty for Malicious Vote Slash​
  1. 10000 staked BNB will be slashed for the validator.
  2. The Double-Sign Jail time is 2^63-1 seconds, which means the candidate cannot become a validator anymore.

Note: Rewards for submitting Malicious Vote evidence: 5BNB. Only relayers can submit a slash request on BSC with the evidence of Malicious Vote of BSC for now, which should contain the 2 votes, signed by the offending validator. Open access to anyone is planned.

Loss for Offline Slash​

If a validator missed more than 50 blocks every 24 hours, the blocking reward for validator will not be relayed to BC for distribution but shared with other better validators. If a validator continue to miss more than 150 blocks every 24 hours, then this will be propagated back to BC and trigger the following penalty for being offline:

Penalty for Offline Slash​
  1. 50 staked BNB will be slashed for the validator.
  2. The Downtime Jail time is 2 days, which means the candidate can send a unjail transaction to become a candidate again.

Loss for Too Low self-delegation​

Validator candidates must stake 2000 BNB as self-delegation. If the self-delegation amount is lower, the Jail time is 1 day.