Tangle Tools Documentation

Roles in a Liquid Staking Pool

There are several key roles involved in creating and maintaining a liquid staking pool:

Role Description: The root is the administrator of the pool with full control over its operations. They are responsible for setting and updating pool roles and managing critical operations like commission setup and governance decisions.
Benefits: As the root, you have the ability to control the overall direction of the pool, set commission rates, and earn a portion of the staking rewards through commissions.
Risks: The root must ensure that the pool operates fairly and transparently to maintain the trust of the participants. Mismanagement or excessive fees could drive users away.

Role Description: The nominator is responsible for selecting validators on behalf of the pool. Their role is critical in optimizing rewards for the pool members by choosing high-performing and secure validators.
Benefits: The nominator can enhance the pool’s performance by choosing the best validators, maximizing rewards for participants.
Risks: Poor validator selection could result in missed rewards or penalties, impacting the overall pool performance and the trust of participants.

Role Description: The bouncer is responsible for managing the entry and exit of participants into the pool. They can block or allow participants, as well as manage pool access settings.
Benefits: This role ensures the integrity of the pool by maintaining strict control over its participants.
Risks: If the bouncer mismanages pool access or fails to protect against malicious actors, it can result in pool exploitation or security vulnerabilities.

Role Description: The depositor is the individual or entity that creates the pool by making an initial deposit. This role is critical because the depositor effectively initiates the pool’s staking process.
Benefits: As the creator of the pool, the depositor can dictate initial terms and pool configurations. They also have the opportunity to collect significant rewards from the pool’s success.
Risks: The depositor’s funds are locked as long as the pool remains operational, limiting liquidity. If the pool fails to attract enough participants or operate effectively, the depositor may face opportunity costs.