What is slashing?

Slashing is the security-critical mechanism in Proof of Stake and its blockchain consensus protocols, devised to punish malicious or faulty behavior of validators. Slashing works in the integrity of the network by economically incentivizing the validators to act in the best interests of the network and thereby deter potentially hostile attacks against it, or violation of protocol rules.

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How Slashing Works:

Validators in the PoS system should stake a certain amount of cryptocurrency to enable them to participate in the consensus process and thus validate transactions. If, within that process, a validator were to perform malicious behavior or make a critical mistake, part or all of their staked tokens could be "slashed," meaning confiscated or burned. This punishment makes for one very powerful deterrent against dishonest actions because the validators will have money at risk.

Reasons for Slashing:

• Double Signing:

A validator signs two different blocks containing the same set of transactions to create confusion or attempt to change the blockchain state.

• Inactivity:

Validators are expected to be online and engaged actively in validation. Extended periods of inactivity or failure to validate can also be considered a reason for slashing.

• Invalid Blocks:

Proposing or voting for invalid blocks due to carelessness or as an effort to manipulate the blockchain can also lead to slashing.

Importance of Slashing:

Slashing incentivizes economically the validator to follow the protocol rules and behave honestly. It makes the cost of malicious behavior so high that generally it increases security and builds trust in the network. By penalizing dishonest or faulty behavior, slashing ensures the maintenance of a decentralized and secure nature of PoS-based blockchain systems.

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VEIGO (Community Mod)

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