VaaS FAQ

Answers to frequently asked questions for Validator as a Service (VaaS) customers.

What is VaaS?#

VaaS (Validator as a Service) is a platform designed to provide managed hosting services for Elrond validator nodes, whether these nodes are hosted as standalone nodes or part of a Staking Provider.

This service is aimed towards the people/entities (i.e various organisation forms) who would like to have their own Elrond node/nodes or run their own Staking Provider, but lack the technical expertise to run the necessary services. Running these servers is the complicated part. Deploying even a single node requires significant capital investment (in terms of EGLD) and technical expertise, so if you have the required EGLD, we believe that risking a significant amount of assets isn’t the best place to learn how to run production servers, so it is best left for professionals.

From our perspective, a node is created initially as an observer. You must stake a node hosted by us to validate transactions and earn rewards. The funds for these nodes are not delegated to us. You earn all of the rewards generated by the network. We can take you through all the required steps.

How is the service priced?#

The pricing is made out of two components: hosting fees and management fee. We charge our fees upfront. As soon as we pay our vendors to bring online new machines, we are unable to refund some or all of the hosting fees. So, in case you change your mind, you must tell us before we incur a cost as often that cost is not refundable by our vendors.

What are hosting fees?#

The hosting fees are essentially our costs which are passed to you. If you were to be running nodes, you would be incurring the same kind of costs. Unlike most managed service providers, we provide an itemised receipt, so we are fully transparent about the operating costs of a node.

The hosting fees are made of:

• Renting servers from various data centre operators.
• Dynamic patching services such as KernelCare Enterprise and LibraryCare. The typical prices should be around $6/server (charged in Pound Sterling), however, volume discounts would typically apply (from CloudLinux who sell these services), or higher density setups apply. We will pass our savings to you.
• Monitoring, alerting, status page. We expect these not to be charged initially (i.e fall under a free tier from our vendor), but over time, we predict that we will run over the free tier allowance. Should that be the case, we would allocate these proportionally to keep it fair.

These hosting fees may be variable at times depending on foreign exchange rates or other factors. While some of our vendors price their hosting services in US dollar or Euro, we are UK based, so our accounting must be done in Pound Sterling. We must report and pay taxes to HMRC in Pound Sterling as well.

What is the management fee?#

Our management fee is a flat fee charged per node. This isn’t charged per individual node i.e primary and backup - these form a single set which is covered by the same management fee, so, this fee covers two distinct services. The management fee is for us to provide customer support, expertly manage the infrastructure, software, security of the deployment, and be on call at odd hours in case there’s an outage.

This is expressed in terms of fiat currency as we’re a young business and crypto markets volatility can be quite a challenge for us. We do accept Elrond as payment, but our pricing is displayed in Pound Sterling. We apply the exchange rate at the date the transaction is executed.

Are my funds safe?#

We operate validator nodes strictly as a non-custodial service. We do not get access to your wallet at any point in time.

Our responsibility is to run the servers safely and maintain high availability.

Your responsibility is to keep your wallet safe. Beware of scammers! We do not ask for your Keystore and password or the 24-word wallet seed. We do not need this information to run a validator for you. We don’t even need to know your wallet address for us to run a validator node for you as the staking operation is done by you using your wallet.

That being said, funds may be lost if a node is jailed or slashed, so making sure this does not happen is part of our responsibility to ensure safety and availability.

Do I need to share private information with you?#

We can’t stress this enough: we don’t need access to your wallet to run validator nodes on your behalf. Whoever asks for this information from you, is a scammer. At most, you need to share your wallet’s public address with us.

Running a node service requires a BLS private key. Unfortunately, there’s no going around that as this is by Elrond network design. For us to establish a private and secure communication channel, you must have a Keybase account. Having a Keybase account is also a prerequisite for running your own Staking Provider as well, so this is overhead only for standalone node owners. This means that there’s a shared responsibility to secure this key as both you and we need access to a node BLS private key. All communication regarding VaaS private key material shall happen through our only Keybase account, mrstaker.

There are two possible scenarios:

• We generate a key and share it with you. Currently, this method has a severe disadvantage as a staked node would go into the queue and it is unlikely to earn any rewards before Phase 4 Staking. If you’re planning to launch a new node, we do not recommend this for the time being. You’re much better off delegating to an existing Staking Provider if you don’t already have an active node.
• You bring your key (BYOK) for a node that’s already active in the network. This ensures that you keep your node active. In this scenario, you must work closely with us to complete the migration whilst your active node is waiting (not earning rewards) rather than eligible mode (where it can participate in the consensus rounds and earn rewards for validating transactions). This ensures that you’re not losing any earnings and your node score is kept.

Can I rotate a BLS key?#

Should you decide to leave our service, we will destroy all copies of your BLS key, however, we do understand if this is cause for concern as you need to trust us on this. We hope that if you do decide to use our service, this is a long term relationship so this won’t be the case.

Should you decide to rotate the key upon leaving our service to ensure you’re the only person/entity who has access to that node private key, there are two possible scenarios:

• Before Phase 4 Staking, it is unlikely for you to successfully rotate this key as you would lose your place as an active validator. Having a new node key would place your node plumb last in the validator queue, so this is highly undesirable as you won’t be earning any rewards sitting in the node queue.
• After Phase 4 Staking, rotating a key should be possible due to the soft auctioning mechanism which should make the queue irrelevant as the determining factor is the stake size.

The 10 days unbinding period applies for both scenarios described above, so rotating a node key does not come for free. It is quite expensive in terms of periods your funds do not earn rewards.

While rotating a key should be unnecessary as we pledge to remove your private data upon leaving our service, we wanted to make sure you fully understand the technical limitations of running a node with us. Transparency is one of our core values.

How much use do I get out of private BLS keys?#

Depends on context. You only need a node private key to stake a node on the network using your wallet, whether as stand-alone or as part of a staking provider. Other than that, all operations regarding your node are executed from your wallet by using that node’s public key only, which is already known by the network.

Running a node service on a server requires persistent access to that key, so most of the time it would be our responsibility to secure this key. You should keep your copy of your key safe. You can keep it offline past the point of staking a node on the Elrond network.

Do I have the choice on which hosting provider do you use?#

In a broad sense, no. We do have a list of vendors which we believe that they provide adequate performance, with room to grow, so the choice is restricted to that list. In general terms, this means fairly recent hardware and CPUs with higher frequency. You can make proposals as we can’t assess the whole market, however, we may take some time until we can accept a new vendor on our supported list.

Bear in mind there are vendors which we explicitly exclude, such as Hetzner, who decided not to accept any “cryptocurrency mining” on any of their servers, although Elrond is unlikely to cause them problems. Essentially, we want to avoid any legal debates with our vendors, so we won’t deploy on any hosting provider which explicitly prohibits blockchain deployments. We believe that it is rather wise to avoid any potential issue that could result in a server getting unplugged rather than try to solve it.

Changing conditions in the market are one of the main reasons for deploying the primary and backup nodes with different vendors as sudden changes in Terms and Conditions shouldn’t happen uniformly across the board.

On top of this, there are additional technical requirements for us to be able to provide a secure service, such as the possibility to employ full disk encryption which is a core requirement from our side. We won’t deploy our services on any hosting provider which is unable to accommodate our use of full disk encryption. This is the biggest challenge for accepting a new vendor as most likely we may need to learn different ways for having this functionality.

Do you support deployments on hardware provided by us?#

We do not support this model at the moment, but we’re not excluding this possibility in the future. While you could save on some of the hosting fees, especially if you own your hardware and colocation is inexpensive, our experience in running managed services tells us that this deployment model often leads to increased requirements for engineering/support time from our side, so we would need to charge higher management fees. We will need to work out this model of deployment, but there are no guarantees that it will be supported in the future.

Do you offer services hosted on your hardware?#

We do not offer the option to use servers owned by us and hosted in a colocation facility. However, we do take into consideration designing machines specifically for hosting Elrond nodes. Should that be the case, we would only host a primary or a backup node on our hardware.

We are always using three separate vendors for hosting the primary and backup nodes plus a cloud provider kept as automation-ready to backfill a secondary backup in case either the primary or backup nodes are offline. If we do this, then we won’t be able to colocate in two separate regions, at least initially, hence the reason for stating the dependency on another vendor to keep the primary and backup in separate regions.

Can you help me set up my own Staking Provider?#

Certainly. We are not even charging for this service as our goal is for you to be successful. Should you decide to use us as a blockchain infrastructure provider, so much the better.

We do realise this may sound like a conflict of interest as we run our own Staking Provider, however, we are committed to network decentralisation. For VaaS, we are strictly an infrastructure provider of services, with no funds delegated to us, so your staking power and the eventual on-chain governance decisions are yours.

We can help you with:

• Create a Delegation Smart Contract. This is a compulsory requirement for every Staking Provider.
• Deploy a basic Delegation Manager Dashboard as Cloudflare Page. Cloudflare Pages have a free tier, so you can run this dashboard at no cost on Cloudflare’s global network.

Our purpose is to get you up and running as a Staking Provider. We may be offering basic customisations, but bear in mind that our expertise is infrastructure and security, not frontend development.

What jurisdiction governs the agreement between us?#

We are UK based and our agreement is covered under the English Law, which is the common law legal system of England and Wales.