A Guide to BABY Staking Mechanisms

The Babylon Genesis implements an epochised staking mechanism that is distinct from conventional Cosmos SDK implementations. This architectural approach provides higher security guarantees and reliable voting power transitions.

Epoch Definition

An epoch is defined as a block height range demarcated by the x/epoching module. Throughout each epoch's duration, staking operations are aggregated in a message queue rather than modifying validator state immediately. At the last block of each epoch, all accumulated staking messages are atomically processed in a deterministic batch execution sequence.

The Delayed Execution Queue

The core of the epochised staking approach is the delayed execution queue:

• Message Submission: When users submit staking transactions (delegate, undelegate, redelegate), these messages are immediately acknowledged and added to the queue.

• Pending Status: The transactions remain in a pending state until the current epoch ends.

• Batch Processing: At the epoch boundary, all queued messages are processed together.

• Voting Power Update: Validator voting power updates occur only at epoch transitions.

UX Considerations for Epochised Staking

This mechanism introduces important considerations that stakers should understand:

• Delayed Staking Activation: While staking transactions are confirmed immediately, the actual staking operation only takes effect at the epoch's end.

• Delayed Funds Locking: User funds remain liquid until staking activation occurs at epoch conclusion.

• Potential for Failure: If users transfer or spend their funds before the epoch ends, the staking transaction will fail when processed.

• Visibility into Pending Messages: Users can view pending staking messages using the LastEpochMsgs query in the x/epoching module.

The x/epoching Module

Babylon Genesis replaces the standard Cosmos SDK x/staking module with a custom x/epoching module that:

• Wraps standard staking functionality to enforce epoch-based voting power transitions.

• Implements similar messages to the default x/staking module but with epochised processing.

• Maintains compatibility with Cosmos SDK while adding the security benefits of epochised staking.

The epoch interval is set to 360 blocks, which makes it 1 hour (with 10s block speed). For more information on this module and exact staking operations, please refer to x/epoching module.

End-of-Epoch Processing

After user’s staking transaction submission, when the current epoch ends, the system will conduct the following actions:

• Queue Processing: All queued staking requests are processed together.

• Validator Updates: Validator power and delegations are refreshed and updated.

• Fund Locking: Your staked BABY tokens are now locked and earning rewards.

• Rewards Begin: You start earning staking rewards from this point.

Viewing Pending Staking Transactions

To monitor pending staking transactions that will be processed at epoch end:

• Use Babylon Genesis Explorers that support epochised staking, or

• Use Babylon Node or RPC Endpoints to query the LastEpochMsgs endpoint in the x/epoching module.

• Check with compatible wallet interfaces.

Fast Unbonding

Babylon's Genesis chain introduces a groundbreaking fast unbonding feature that significantly enhances the staking experience for users, allowing them to unstake their BABY tokens in a fraction of the time compared to traditional Cosmos SDK chains. This feature is made possible through a cryptographically secured accelerated unbonding protocol, which reduces the standard 21-day unbonding time to approximately 2 days by utilizing Bitcoin checkpoint verification and timestamping technology.

The Unbonding Process

When a user decides to unstake their BABY tokens, the process involves several key steps:

• Submission: The user submits a request to unstake (undelegate) their tokens.

• Epoch Processing: The unbonding request is queued until the end of the current epoch.

• Bitcoin Checkpointing: The epoch state is recorded on the Bitcoin blockchain.

• Confirmation Wait: The system waits for 300 Bitcoin block confirmations (~50 hours).

• Token Release: Once confirmed, BABY tokens are fully released and become transferable.

Benefits of Fast Unbonding

The accelerated unbonding process offers several advantages:

• Improved Liquidity: Users can access their funds much faster, reducing opportunity costs.

• Capital Efficiency: Faster capital recycling enables more dynamic staking strategies.

• Security Retention: The process maintains security by leveraging Bitcoin's proven security model.

Practical Considerations

When planning to unbond BABY tokens, users should consider the following:

• Timing: Unbonding near the end of an epoch may minimize waiting time.

• Bitcoin’s Network Conditions: Network congestion could extend the unbonding process.

• Monitoring: Utilize blockchain explorers such as Mempool to track Bitcoin confirmation speed.

Slashing Mechanisms

Babylon Genesis chain enforces slashing to maintain network integrity and security. Specifically, this occurs when a validator signs or votes two distinct blocks at the same height. This situation represents a severe security breach that can potentially lead to network forks. The consensus mechanism automatically identifies double signing by detecting conflicting signatures, ensuring that such misbehavior is promptly addressed.

Slashing Implementation

• Enforced via x/evidence module: Double Signing: The protocol accepts and verifies cryptographic evidence of equivocation of a validator.

• Enforced via x/slashing module:

  • Jailing: Validators that trigger slashing events are temporarily removed from the active set to "jailed".

  • Unjailing: Validators must submit an unjail transaction and wait for a specific period before rejoining.

Slashing Parameters for BABY

Parameter	Description	Value
Signed Blocks Window	The number of blocks over which validator performance is measured	10,000 blocks
Minimum Signed Blocks	The percentage of blocks a validator must sign within the window to avoid jailing	60% (6,000 blocks)
Slash Fraction for Doublesign	The percentage of staked tokens slashed for equivocation (signing conflicting blocks)	0.05 (5%)
Downtime Jail Duration	The period a validator is jailed after failing to meet minimum signed blocks	300s

The slashing conditions and the protections in place is crucial for delegators as it adds to the risk premium of the staking strategy. These measures are designed to maintain the integrity of the network while providing safeguards for delegators against potential losses due to validator misbehavior.