Introduction to Delegators

What is a Delegator?

Delegating SQT is an easy way to stake your SQT and receive APY on your tokens. It only takes a few minutes and requires no technical skill.

The Delegator role enables Delegators to “delegate” their SQT to one or more Node Operator (RPC Providers or Data Indexers) and earn rewards (similar to staking).

Without Delegators, Node Operators may receive fewer rewards because they will have less SQT to stake. Therefore, Node Operators compete to attract Delegators by offering a competitive share of their rewards.

How to delegate to a Node Operator

Once you have some SQT, you can delegate using our app. Read more about how you can delegate here.

Benefits of being a Delegator

There are several benefits of becoming a Delegator:

• It's easy to get started and requires little technical knowledge, Delegators only need to acquire SQT tokens and then learn the process of delegating the tokens to their preferred Node Operator(s).
• Delegating contribute to the network by putting their SQT to work by delegating their SQT to Node Operators. In return, Delegators are rewarded with SQT (a share of the reward pool).
• There is no minimum required delegation to be a Delegator. This means that anyone can join no matter how much SQT one has.

Risks of being a Delegator

Even though it is not considered a risky role, being a Delegator includes a few risks to be aware of.

1. Constant adjustments of staking parameters by Node Operators and delegation fees can increase the risk to a Delegator. For example, a Delegator might miss a change in staking parameters resulting in a less than expected return. To reduce this risk, when Node Operators decrease their stake parameters, it will only take effect after the next full Era has been completed, giving time for delegators to assess and make any changes.
2. Node Operator poor performance: It is possible that Delegators can select Node Operators that perform poorly and therefore provide a substandard return on investment to Delegators. Delegators are therefore encouraged to do Node Operator due diligence on potential Node Operators. A Reputation Index is also available to help Delegators compare Node Operators to each other.

Once a preferred Node Operator(s) is found, due diligence should be performed to check a Node Operator’s reputation and reliability. Assessments could be performed to evaluate if the Node Operator is active in the community, if the Node Operator helps other members, if it is possible to get in touch with the Node Operator, and if the Node Operator is up-to-date with protocol and project updates. The aforementioned Reputation Index can also serve as a primary selection indicator.