Introducing Pegasus — A Reliable Stake Pool for Cardano’s Shelley era

With the fast approaching incentivized testnet, stake pool operators are preparing for Cardano’s Shelley era. Over three thousand telegram members in the stakepool workgroup channel are learning how to setup, configure and maintain IOHK’s Jörmungandr node which will be used to run the incentivized testnet.

Although not every member in the channel represent a stake pool, many of them have been successfully running their nodes on the beta and nightly testnets. Some people have even setup private networks to run focused tests in a controlled environment with a stable network to learn and study how the software behaves under certain circumstances. It is estimated that the incentivized testnet will launch with at least a hundred stake pools and this article explains why ADA holders should consider delegating their stake to the Pegasus Pool [PEGA].

About the operators

The pool is run by three brothers based in London from the UK with computer science degrees and over fifteen years of software development experience, and with system operation and server administration skills.

Pegasus has been closely following the Cardano project since 2017 by first watching the infamous whiteboard video by Charles Hoskinson, then reading every technical report published every week, watching videos uploaded by IOHK’s youtube channel and reading many of the team’s published academic papers which clearly explain the vision and tech behind the project.

Desirability

When it comes to selecting the pool for delegation there are essentially three major factors in the process.

1 - Uptime

In the Daedalus and Yoroi wallets stake pools will be ranked based on their performance. This is a calculation based on the number of blocks the pool was tasked to create compared with the number of blocks it actually created. Therefore stake pools are expected to be online 24 hours a day, 7 days a week and 365 days a year. Occasional restart of the node is acceptable when the software needs to be updated, however pool operators should ensure this is done in a period where they are not scheduled to produce blocks for the network.

There is a live pool monitor on the Pegasus info website demonstrating that Pegasus is able to operate its node reliably on the beta test network without interruptions, and at the time of writing produced 1511 blocks which represents 1.62% of the entirely blockchain.

Should something go wrong, it is essential that operators mitigate the issues as soon as possible in order to avoid missing their scheduled slots which would result in losing money for their delegators. For this reason Pegasus has implemented an alerting system which notifies the operators immediately after an anomaly is detected in the metrics.

2 - Fees

Transaction fees are collected on the duration of an epoch (5 days), also as further incentives, a defined amount per epoch is sourced from a reward escrow and contributed into the epoch rewards. After each epoch stake pools will take their cut to cover their operational costs and services and then distribute the remaining rewards to their delegators proportional to their delegated stake. There are 3 values a stake pool can set to configure the stake pool’s tax:

• tax-fixed: this is the fixed cut the stake pool will take from the total reward due to the stake pool
• tax-ratio: this is the percentage of the remaining value that will be taken from the total due
• tax-limit: a value that can be set to limit the pool's Tax

Let’s say a pool has created some blocks during an epoch and is entitled to receive some ADA as rewards. Before distributing the rewards among the delegators, the pool will take its tax.

1, tax-fixed amount is extracted first. If this is greater or equal to the total then there is no rewards distributed to delegators.

2, with what remains the pool extracts its tax-ratio and checks the total tax is not greater than tax-limit: if it is the total tax will be tax-limit.

3, after crediting the fixed and percentage amounts to the pool, the protocol distributes the remaining rewards to the delegators proportional to their stake.

Pegasus will start the incentivized testnet with the following configuration:

• tax-fixed: 0 ADA
• tax-ratio: 5%
• tax-limit: 0 ADA

3 - Services

A stake pool can offer additional services in top of creating blocks when required. ADA holders can support the development of these services by delegating their stake to their chosen pool. Pegasus is committed to develop open source tools and create educational materials for the community to increase the adoption and spread awareness of Cardano.

Conclusion

Pegasus is a reliable and transparent Cardano stake pool committed to increase the security and decentralisation of the network. Its website will have useful chain and pool explorers with stake distribution information for the community to use as a gateway into the Cardano blockchain.

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