I asked this question in other places but haven’t seen a compelling response yet. How does the incentivisation ensure good network connectivity and latency? Participation nodes in the US and Europe probably hold most Algos and receive a significantly larger portion of rewards. What about other regions, say Africa or the Middle East, or specific countries where participation nodes run with a low number of Algos? It seems to me that rewards should not be limited to the number of proposed blocks but also how effective a node is improving connectivity and relaying transactions. I appreciate any clarification regarding this topic.
Thank you
I think incentivisation will provide opportunity for holders across the globe to run participation nodes. Also there will be pools formed across continents which will help people who don’t have expertise to participate by staking their algo to a smart contract.
Yes there will be whale pools, but as the system requirement for running a participation node is low, each dApp with considerable traffic can think of running their own node (incentive is a plus). These all factors will lead to better decentralization.
If the rewards are proportional to the number of Algo and if the Algo holdings are relatively low in particular regions then the incentivisation program doesn’t really incentivise running participation nodes in those regions.
Rewards will be mostly proportional to blocks proposed.
Then I think my question is valid and there is a concern that needs to be addressed as the network is transformed to p2p.
There will be pools formed globally. And people with less expertise will stake their algo to pool smart contracts to share rewards. Also there will be whales running their own nodes along with protocols. I this case region does not matter. Also as years pass , the blockchain will become more decentralised
The question is why whales don’t run nodes right now and the foundation needs to run so many nodes:
We can certainly hope one of the above happens but that doesn’t ensure the required property that is critical for the network proper function and health.
As of now people don’t have incentive to run nodes. Once incentives come into play, if you have more algo, you have more chance to be choosen via VRF. So whales will certainly think of running nodes
Back to the same point since per-region (or for network topology/connectivity) incentives aren’t there, they run their nodes in regions (US/Europe) where it is cheapest and most convenient to run. I guess we both agree that incentives do matter and shape the behavior of participants.
Regional incentives can easily be taken advantage. So if i want to run a node in Africa, i can do it from any part of the world. Just buy a server space in Africa, install my node and use a VPN. So region wise node spread should happen naturally as blockchains mature IMO.
One more important reason for running participation nodes in a diverse set of regions is to prevent the network halt due to an earthquake/fire/etc. event in a particular region with a large total stake of participation nodes.
We are planning to run one from Asia