What is Delegation?

What is Delegation?

– One of the main features within the Incentivized
Testnet is delegation. Now Shelley marks the
start of Cardano’s journey towards becoming a fully
decentralized platform. Now in theory, every ada
holder could run their own node to create that network. But that principle
relies on all these nodes running pretty much 100% of the time. In practice, not everybody can do that, they might not have the
skills, the time, the resources or just not the interest. This is where delegation comes in. Delegation allows each ada holder to effectively hand responsibility for running that node to somebody else. The ada holder assigns
their stake to a stake pool who runs the node on their behalf. The ada holder can still earn rewards and the stake pool takes a small
cut in return for doing so. Testing this delegation
process will be a key part of the Incentivized Testnet with real rewards for ada
holders and for stake pools.

5 thoughts to “What is Delegation?”

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