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What's the point of participant nodes if staking offline earns the same?

YoungBerry

The FAQ says:

Does a user need to set up and operate a participation node to earn rewards?

While anyone can run a participation node, not all users will have the technical ability to participate in the consensus protocol. For users who are not able to run a participation node, the Algorand blockchain offers an offline mode. When a user declares themselves offline, their account’s stake is not taken into consideration for the sortition process. This allows any user to have a stake in Algorand without requiring them to operate a participation node.

Currently, the system treats all users equally. In the future, the Algorand Foundation may propose an upgrade to increase the rewards given to online users—incentivizing them for their participation in the cryptographic sortition protocol—and decrease the rewards given to offline users.

If currently rewards for running a participant node and staking offline are the same, then what’s the point in running a participant node?

JasonW

From the FAQ:
“Currently, the system treats all users equally. In the future, the Algorand Foundation may propose an upgrade to increase the rewards given to online users—incentivizing them for their participation in the cryptographic sortition protocol—and decrease the rewards given to offline users.”

YoungBerry

Yeah I know that, but what’s the point of running a participant node now? I can bootstrap a node in a few hours when the upgrade takes place.

JasonW

You are correct unless you want to build an application on top Algorand. Having a node serves as the REST endpoints for your app and access to the network.

teddy

Where are currently the differences between a
*Participating node (online)
*Particpating node (offline)
*and staking in a wallet

regarding rewards?

And am i right: No Staking, no rewards? I mean, can i run a partcipating node without stake and still getting rewards?

JasonW

You can have accounts online and offline. Online accounts are accounts that have tokens and have generated a participation key, the account has been taken online on a specific node(which could be your own) using the generated participation key and is now participating in consensus. Offline accounts are accounts with tokens but have not taken the account online on a specific node. If a node has one or more accounts online then it is a participating node.

From the FAQ
While anyone can run a participation node, not all users will have the technical ability to participate in the consensus protocol. For users who are not able to run a participation node, the Algorand blockchain offers an offline mode. When a user declares themselves offline, their account’s stake is not taken into consideration for the sortition process. This allows any user to have a stake in Algorand without requiring them to operate a participation node.

Currently, the system treats all users equally. In the future, the Algorand Foundation may propose an upgrade to increase the rewards given to online users—incentivizing them for their participation in the cryptographic sortition protocol—and decrease the rewards given to offline users.

melander81

Is it possible to participate in Staking via the mobile wallet? I do not see any option on the wallet to create a Particpation Key.

edited
JasonW

No you have to either have a node running or use a service that provides more. Take a look at this page for more information:

melander81

Thanks Jason. It seem I will be relying on staking services via exchanges. Huobi recently announced that they will cater to the little guys.

teddy

so why getting people rewards for just holding their tokens in the mobile wallet?

Tim

As a clarification - if you want to run an application that uses the blockchain through the API, you will need a server running Algorand software.

You 100% do not want that server you expose the API of to also be hosting your participation keys. Keep these functions apart. It is also likely that the server will need the full ledger, not the snapshot a participation node has and should have an optimized index.