Since Team-backed changes were implemented, I’ve tried various approaches with Phragmen and my experience has been the same as in that linked post.
But there’s a lot of nominator churn because there’s 300+ new nominators (meaning: Team-backed validators who accepted to change their address so that they can nominate before xx coin is listed and coins unlocked), and many of them try to eke an extra coin.
One day I have 25 nominators on a node, the next day two…
But I’m writing this post because I happen to have time and I wanted to highlight some stupid behaviors by nominators.
Node selection ¶
It seems many nominators aren’t particularly smart and prioritize nodes based on (ascending) rewards percentage setting set by the validator.
Most validators enjoy Team Multiplier, and rewards for those go up to 18%. But even people who set 18% themselves think 18% is too high, so they pick nodes with a lower percentage (5%, 7%, etc.).
For an example, right now (era 137) I see several Team-backed validators who have less than 100K on the node (excluding Team Multiplier), but none of the Team-backed nodes with a commission lower than 10% have less than 100K xx on the node.
The thing is, nominating a node that charges 10% and makes 35,000 points a day won’t make as good a return as a node that charges 18% and makes 43,000 points a day. But this hasn’t occured yet to those investment geniuses.
Greed & negligence ¶
Today (era 137) I scrolled a bit in Explorer and saw multiple nodes with ample stakes from multiple nominators that are… OFFLINE or just minting blocks. Yep.
One of them has been like this for days (cMix service down). Another is completely off.
But people think they can make more if they nominate 16 nodes and then can’t keep an eye on all of them, and don’t even notice that some of their nodes aren’t earning.
Team-backing as proxy for due diligence ¶
The third issue is nominators can’t be bothered to check what validators do.
In the case of one of my nodes (that doesn’t have a multiplier), it charges less than my other node (16% vs 18%), but it still gets less nominators because there’s no Team Multiplier on it. One may say “validators want to be sure you won’t hike reward percentage to 75%”, but XXV2 has never hiked rewards percentage without advance notice, and on average it’s been lower than average of TM-backed nodes for tens of eras.
That’s easy to see in Mainnet Explorer, even if the nominator doesn’t want to check validator’s Web site.
What about it ¶
One of my nodes (XXV2 - the node without Team Multiplier) has been affected by poor node selection and an absence of Team Multiplier. Positively affected, if I may add.
It has only 6 nominators and active nominators are very few (usually 2-3, because Phragmen works in mysterious ways).
XXV2 has also been affected by greed & negligence, whereby XXV3 (old XXV) gets many more nominators because it’s Team-backed, getting a lower return.
There are also downsides.
For an example, I am somewhat restricted in how I nominate because of the few nominators on XXV2 - if Phragmen allocates too much to some other node, XXV2 might not get elected (happened in era 128).
So for now only nominate my own two nodes.
Even if I could make more by nominating additinal nodes, I want XXV2 to be active, and I don’t want to create a burden for myself (or otherwise, become a victim of greed and negligence).
Maybe I could make an extra 100 xx per day, but do I want to have periods of inactivity for XXV2, and have to pick validators and check what each is doing on a daily basis? Hell no!
I’d rather let the two nodes run until xx gets listed, at which point I may send some coins to those validator addresses, and stand up another (third) node which I plan to call XXV4.
To prepare for that I’ve lowered validator’s commission on XXV2 to 14%, to see if that helps me get 10-15 nominators on it.