Pledge factor as prevention of Sybil attacks
During the last September Cardano development update, there was an interesting discussion of Pledge in relation to Sybil attack prevention.
Firstly, let’s define what is a Sybil attack as not all of our readers might know it. Sybil attack is when the attacker subverts the reputation system of a network service by creating a large number of pseudonymous identities and uses them to gain a disproportionately large influence. (definition from Wikipedia). So in our particular case of Cardano blockchain, this might be when some stake pool operators create multiple pools, not related to each other, in order to gain bigger influence and avoid pool saturation (as when the pool is oversaturated, delegators will receive less rewards).
The conversation during Crowdacst raised the topics of saturation and pledge. Here are the words of the speaker:
“The idea is that you have to attach Pledge to the pool, which technically just means the amount of money you delegate to your own pool. Some of the formulas which we developed say that the pool gets a slightly higher reward if the delegation to your own pool is higher. This means that if you try this attack and set up several pools, that obviously because your own money is finite, you have to split your money to all of these pools. So each of these pools gets a little bit less and then all those pools are less attractive because they generate smaller rewards. So if somebody does that, those pools will be less attractive to the community and the delegators won’t delegate to those pools. So that’s this a0 parameter which determines how high this influence is between this pledge of delegating to your own pool and the rewards”.
This conversation took place at 13:30, the link to the crowdcast: https://www.crowdcast.io/e/september-cardano
Of course, if you have time, we suggest you watch the whole crowdcast, as it’s a great source of news and inspiration not only for staking but every aspect of the Cardano ecosystem.
AzureADA is in the TOP-50 pools by the pledge number. Currently, we have 1.6 million ADA of pledge and we plan to increase this number.
For us, pledge is, first of all, the “skin in the game factor”. We don’t hold any crypto other than Cardano (maybe apart from some tiny amount) and the success of Cardano is our success.
We are happy to know that our Pledge is helping our delegators to receive better rewards.