How Do Slashing Penalties in PoS Affect a Validator’s Net Fee Revenue?
Slashing is a penalty where a portion of a validator's staked capital is permanently removed for malicious or negligent behavior (e.g. double-signing a block or being offline). While it doesn't directly affect the fee revenue per block, the loss of staked capital reduces the validator's future staking power and, consequently, their expected future fee and reward revenue.
Glossar
Slashing
Mechanism ⎊ Slashing is a punitive mechanism in Proof of Stake (PoS) blockchain networks designed to penalize validators who act maliciously or fail to perform their duties correctly.
Fee Revenue
Generation ⎊ Fee Revenue quantifies the total amount of value captured by a protocol or network directly from user transaction charges, distinct from inflationary issuance mechanisms like block subsidies.
Validator
Role ⎊ A validator is a critical network participant in a Proof-of-Stake blockchain responsible for proposing, verifying, and attesting to new blocks of transactions to maintain consensus and secure the distributed ledger.
Slashing Penalties in PoS
Mechanism ⎊ Slashing penalties represent a core economic security mechanism within Proof-of-Stake (PoS) protocols, involving the forced forfeiture of a validator's staked collateral for engaging in malicious or negligent behavior.