The recent vote within the Starknet community has given the green light to a new staking feature, known as “SNIP 18.” This proposal, developed by core team member StarkWare, received broad support, with 98.94% of voters endorsing it through Snapshot’s decentralized Snapshot X platform. Only 0.45% abstained, and 0.61% opposed the proposal, reflecting a strong consensus.
Eli Ben-Sasson, CEO of StarkWare, described this development as a “historic milestone” for the network, emphasizing its role in advancing Starknet’s decentralization objectives. He remarked, “As one of the pioneering Layer 2 solutions to offer this staking opportunity, we are moving closer to achieving a network that is fully operated and run by the community.”
Under the new system, STRK token holders need a minimum of 20,000 tokens to participate directly in staking. Those with fewer tokens can delegate their holdings to others who meet the staking requirements. This setup is designed to increase community involvement and align with Starknet’s broader goal of decentralization.
The staking feature is expected to become available on the testnet soon, with full integration anticipated in the fourth quarter of 2024. This timeline offers STRK holders a chance to prepare for engagement in the staking ecosystem.
A notable aspect of the approved proposal is its innovative minting mechanism aimed at balancing staker rewards with inflationary pressures. The mechanism is based on a formula proposed by Professor Noam Nisan, defined as M = C/10 * √S. In this formula:
The initial value of C is set at 1.6. However, the Starknet Foundation has provided for future adjustments to this parameter within a range of 1.0 to 4.0 based on actual staking participation. Any modifications to the minting curve will be publicly communicated on the community forum with a two-week notice and detailed justification to maintain transparency.
The introduction of staking for the STRK token brings several benefits:
Despite these advantages, the relatively low voter turnout of 0.08% of eligible voters in the recent vote highlights the need for increased community engagement and awareness in future governance matters.
Starknet plans to introduce additional governance features and responsibilities for stakers in phases. Potential future updates could include roles in decentralizing the network’s sequencer and prover, further enhancing the platform’s commitment to decentralization.
Recent organizational changes, including the resignation of former CEO Diego Oliva in August, have not slowed the network’s progress. The Starknet Foundation remains focused on implementing innovations that benefit the community.
As a Layer 2 scaling solution for Ethereum, Starknet uses zero-knowledge STARK proofs to validate off-chain transactions, significantly boosting transaction throughput. The network is capable of handling up to 100,000 transactions per second during peak periods, with the potential to reduce transaction costs by up to 200 times compared to traditional on-chain methods.
The new staking mechanism is a crucial step in Starknet’s ongoing efforts to enhance its network’s efficiency and decentralization. As the platform evolves, stakeholders can anticipate further developments that aim to refine and expand its capabilities.
The implementation of the new staking mechanism for STRK token represents a significant advancement for Starknet, emphasizing the platform’s commitment to community-driven governance and decentralization. With the mechanism set to become available soon, STRK holders and potential participants should prepare to engage with this new feature and contribute to the network’s growth.
As Starknet continues to evolve, maintaining active community involvement and staying informed will be essential. The success of this initiative will not only influence Starknet’s future but also set a benchmark for other Layer 2 solutions in the cryptocurrency space.
Julie is a renowned crypto journalist with a passion for uncovering the latest trends in blockchain and cryptocurrency. With over a decade of experience, she has become a trusted voice in the industry, providing insightful analysis and in-depth reporting on groundbreaking developments. Julie's work has been featured in leading publications, solidifying her reputation as a leading expert in the field.
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