In the last lesson, we introduced Polkadot's shared security. Project parties can join Polkadot to allow Polkadot to maintain consensus. All parachains can enjoy Polkadot's security and only need to focus on their own applications. And as more parallel chains are added, due to Polkadot's heterogeneous sharding model, the more Polkadot relay chain nodes will be, and Polkadot will be safer. The safer it is, it attracts more parachains to join, which is a virtuous circle of development.

It can be seen that Polkadot gives people the greatest sense of security because of the ability of the relay chain to maintain consensus. How does the relay chain maintain consensus? If the nodes of the relay chain are not dispersed enough, they are monopolized by some nodes, even if the nodes No amount of security will be felt. Today we are going to talk about how Polkadot's relay chain makes nodes dispersed and decentralized enough. This is the core element of Polkadot's shared security.

1. Consensus mechanism

In Polkadot's nomination proof of equity, there are two roles. One is the validator. It can be considered as a node miner. Anyone interested in maintaining the Polkadot network can apply to be a validator node. One is the nominator. It can be considered as a retail account holding DOT. As a nominator, you can vote for a validator node you trust with DOT, stake DOT on this validator node, and earn interest.

Note that the DOT is not transferred to the verifier, but is pledged on the Polkadot network, and the verifier has no right to use the pledged DOT. In the initial stage of Polkadot, the number of official validator node seats is limited, if it is 200.

If you want to become an official validator node, the total number of DOTs you need to vote for your node can be ranked in the forefront, that is, to be in the top 200, so that you can become an official validator, otherwise you can only be a candidate validator. There is no benefit.

Please remember that being elected as an official validator is not worry-free. The nominator has the right to switch to other nodes at any time. Once the nominator does not trust you, the total number of DOT votes for your node will fall outside of 200, sorry, You lose the qualifications of an official validator and become a candidate validator.

Polkadot will dynamically adjust the seats of formal validators according to the development of the ecology. The 200 official validator seats mentioned above are only hypothetical, not fixed. You can click to read the original text to query the number of validator seats. As shown in the figure below, the number of formal validators is 197 and the number of candidate validators is 179.

As I said last time, the more parachains, the more formal validator nodes will be. Therefore, in the current initial stage of the Polkadot network, there is no parachain so there are not too many formal validator nodes. In this way, through dynamic adjustment, according to the needs of the current network, the number of seats of formal validators is reasonably arranged to ensure the maximum network efficiency.

3. Interesting market regulation

How does NPOS make the network decentralized enough to prevent the emergence of monopoly nodes?

Some people say that if a validator node is voted by many nominees, such as an exchange, and the user recharges the DOT to vote for itself as a validator node, isn't it possible to become a monopoly node? Here we need to explain how the interest income of the validator and the nominator is distributed.

1. The revenue of a single node
   In the POS consensus mechanism, the interest distribution method is that the more coins pledged by a node, the more interest will be distributed.
   In Polkadot's NPOS consensus mechanism, interest distribution does not depend on the total amount of DOT pledged by nodes, and all official validator nodes are equally distributed.
   Daily income of a single node = total interest of the entire Polkadot network on the day / number of official validator nodes

2. The income of validators and nominators
   The daily income of a single node is of course to be shared by the validator and the nominator. That is, the validator and the nominator should share the daily income of this single node together.
   The income of the formal validator = the commission you set, which can be set freely from 0% to 100%. For example, setting 10% is 10% of the daily income of a single node.
   The nominator's income = the daily income of a single node minus the validator's commission, and the remaining part is distributed according to the proportion of all nominators pledged.

3. Market regulation
   For validators, commissions can be set freely, some nodes have high commissions and some nodes have low commissions, and the market is free to compete. This leads to the following situations: 1. If the commission is high, the nominator will not vote for you. If you switch to a validator node with a lower commission, there is a risk of being out. 2. If the commission is low, it will definitely be uncomfortable as a validator.
   Therefore, after the market is adjusted, the validator's commission will gradually return to an appropriate range, for example, 5%-10%. So the question is, if you are the nominator, which node would you vote for when most validator nodes have similar commissions? Smart nominators will definitely vote for nodes with a low total pledged DOT.
   why? Because due to the average distribution, the daily income of a single node is the same, and the commission of each validator node is similar. If you vote for a node with a low total number of pledged DOTs, the proportion of your pledged DOT will be larger. Occupy an advantage in distribution.
   Key points: It is precisely because nominators are more willing to vote for nodes with a low total pledge amount, a validator node pool with equal pledge amount will be created, which is sufficiently decentralized (understand this sentence well, think about why)

4.special circumstances

There is a special case. If the validator node votes for itself, just like the transaction node mentioned above, and votes for the user's DOT, how to prevent monopoly?
First of all, if the total amount of DOT pledge of a single node is particularly large, it will lose a large amount of interest as a validator node. Because the income of each single node is the same (evenly distributed), and it is clear that multiple nodes can be made under the conditions, why should DOT be concentrated to one node to get the income of only one node?

If the node does evil and performs poorly, such as frequent offline, crash, etc., Polkadot will punish the validator node. The more the total amount of pledge, the more the penalty, so from the perspective of avoiding risks, it will not be DOT is concentrated on one node. For nominators, the loss will be reduced after the node with a low total number of pledges is penalized, reducing the risk.

What's more reliable is that if the validator nodes cooperate with each other and reach a certain ratio, the penalty amount can even punish all pledged DOT. This further ensures that the Polkadot network is unlikely to have events like 51% attacks (double-spending attacks).

Polkadot’s nomination proof of interest has made the nodes sufficiently dispersed through the human nature of profit-seeking behavior. From the moment of landing, it marks the birth of a true decentralized network.