It is important to understand how GLMR staking mechanics work in order to select the right collator(s) for you.
Collators (block producers): block producers for the Moonbeam network.
Delegators: token holders that "delegate" their tokens rights to participate in staking to collators.
Collators are assigned "blocks" of transactions and are responsible for validating them. When collators produce a block, rewards will be earned and distributed to their largest 100 delegators (ranked by stake amount) proportionally to their stake. In order for collators to be active and eligible to receive blocks to produce, they must be in the top 52 collators ranked by highest stake amount (the amount of GLMR self bond + delegated to them). Unlike most conventional staking mechanics where block producers with more stake get assigned more blocks to validate, with GLMR staking, blocks to be validated will be assigned to active validators randomly and is not dependent on their total stake. Therefore delegating to active collators with a lower stake will lead to higher rewards as they will validate a similar amount of blocks as collators with larger stake, earn the same amount of rewards, but will have more rewards to redistribute for each GLMR delegated to them.
The two in conjunction - (1) the fact that only the highest 52 collators get assigned blocks, and (2) the collators with the lowest stake will generate higher rewards per GLMR delegated to them - creates an interesting platform for different strategies to select collators. Delegators can select and divide their stake with up to 25 collators.
Delegators have to carefully select collators to maximise their rewards. Delegating stake to active collators with a lower stake will lead to higher rewards. However if their stake is too low, they may be kicked out from the active set (52 active ones) and no rewards will be earned. Therefore delegators have to balance between selecting collators with low stake amounts that will generate high rewards and collators with high stake amounts that are guaranteed to earn rewards.
The strategy to select depends on the delegators risk profile.
Example with the two extremes:
1. Delegator A has a high risk tolerance and selects only "waiting" collators in the hope that they will be placed in the active set. If they become active they most likely will be amongst the collators with the lowest stake and will maximise rewards for this delegator.
2. Delegator B is risk averse and selects collators with high stake amounts to ensure they will receive rewards, but their rewards may be less than delegator A if he gets it right.
For more information on staking Moonbeam (GLMR) with P2P Validator and our special offer for large GLMR delegations, visit https://p2p.org/networks/moonbeam.
For additional staking support, visit the P2P Moonbeam support center.
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