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HIP30v2: Harmony's Network Evolution and Token Redistribution
Dear Harmony community,
We are excited to bring you the latest progress and upcoming plans regarding HIP30v2. Your continued support and engagement are invaluable as we progress with these critical changes.
The Harmony Team has been working tirelessly on developing and refining HIP30v2. We are pleased to share that HIP30v2 has been approved through the validator community snapshot vote at this link. The proposed changes under HIP30v2 are as follows:
Split 441M ONE tokens annual emission: 75% for staking rewards and 25% for bridge recovery.
Shutdown of Shard 2 and Shard 3 of our network
Change from 250 to 200 nodes each for Shard 0 and Shard 1
Minimum validator commission increased from 5% to 7%.
We thank the Harmony community for your active participation and valuable input during this process.
We are targeting the HIP30 epoch to occur on November 2, 2023, when all the above features will be activated.
Below is additional information about what will happen and what it means for the entire ecosystem and Harmony ONE holder.
Shard reduction and ONE Balance Account Migration to Shard 1
With Shard 2 and Shard 3 being terminated, we understand that maintaining user balances is crucial during this migration.
As a ONE token holder or exchange partner, you don’t have to do anything if your ONEs in Shard 2 or Shard 3 are on-chain. The migration will happen automatically.
However, partners and developers using any off-chain solution to store the ONE balance in Shard 2 or 3 will need to perform that migration independently.
How and when is the migration going to happen? At epoch N-1 (N being the epoch activation of HIP30), one ONE account balance will be transferred from Shard 2 / 3 to Shard 1 at every block.
Additionally, for Harmony Shard 2 and 3 validator, your node will require :
a new version of the Harmony binary like any hardfork
and a small DB to be imported (more info to be provided)
Without the above, nodes will stop and won’t be able to participate in the consensus at epoch N-1. And at epoch N, there won’t be any more shard 2 or 3 validator nodes.
25% Emission split to a Recovery Multisig
With HIP30 approved, 25% of the 441M ONE tokens emitted will be sent to the Recovery Multisig address every year until another proposal is passed.
Below are more details of the multisig address operation and requirements
Recovery Multisig will hold tokens from the network emission and transfer them to fund burn partners for depegged assets every month.
Recovery Multisig follows strictly the operations of the current burn.
Recovery Multisig continues to hold tokens from emission after the recovery is completed – until further Snapshot proposals.
Recovery Multisig is a 5-out-of-7 Harmony’s Gnosis Safe with elected custodians.
Open nominations for electing diverse and engaged custodians from our community.
Any validator, delegator, or holder may self-nominate or be nominated with a Snapshot vote.
No team members or partners will participate in the election or the operations.
Custodians have been elected and made of active, harmony community members:
Nick V | Staking Club @nickv
TEC Viva @TECViva
Hank the Crank @HankTheCrank
Affinity Shard @AffinityShard
Feel free to check this page for the current setup and the latest custodians to date: https://multisig.harmony.one/settings/setup?safe=hmy:0xD8194284df879f465ed61DBA6fa8300940cacEA3
Minimum Validator Commission Increase
As with our previous update to the minimum validator fee of 5%, validators that are at least 100 epochs old and have a fee below the new minimum will have their fees increased to 7%, this will apply to all validators, both active and inactive.
Below are essential information for the validator community
Skip if you are not a validator
Shard 2/3 Validator Node Migration and tasks:
From a high-level standpoint, Shard 2 and Shard 3 validator node runners:
Validators are kindly requested to select either Shard 0 or Shard 1 for their future operations and take this time to rebuild your node accordingly.
At N-1 epoch activation of HIP30v2 (N), validators must update their on-chain validator information:
a. Deleting the old Shard 2 and 3 BLS keys
b. Adding the new Shard 0 or 1 BLS keys
Import preimage DB on Shard 2 and 3 if you are running a validator at N-1 epoch
If those changes are not done at N-1, and a validator still holds its Shard 2 or Shard 3 BLS keys, their validator will be automatically set as inactive at epoch N.
Shard 2/3 nodes still running at epoch N-1 will have to be upgraded to the harmony latest version and have a small preimage DB imported (instruction to be given along with harmony release)
Step 1: Preparing your node
Two weeks before the hard fork activation epoch (N), we recommend generating new BLS keys and building your new node on either Shard 0 or Shard 1, based on your preference. Ensuring this new node is fully synchronized and prepared for the hard fork epoch (N) is essential.
Step 2: Validator Key
Migration and update In the second step of the migration process, Harmony does not prescribe a specific timing for this migration, allowing you to choose the timing that aligns best with your operational and financial strategy.
The last epoch to complete the migration is at epoch N-1, right before the hard fork activation (N). During this migration, it is imperative that you remove all your existing Shard 2/3 keys and replace them with the Shard 0/1 keys generated in Step 1.
At epoch N, the validator will be marked inactive if they retain any Shard 2 or Shard 3 BLS keys from epoch N-1. This status remains applicable, even if they have successfully incorporated the new Shard 0/1 keys obtained in Step 1 of the migration.
Step 3: Upgrade and Import preimage DB for S2/S3 node
If validators decide to run Shard 2 and 3 node at epoch N-1, they must upgrade to the latest harmony binary once released and import a small DB. This is a crucial step to be completed before epoch N-1. This DB is required to allow the ONE balance account migration from shard 2/3 to shard 1, starting at the first block of epoch N-1. Without this DB, your validator node cannot verify the blocks, participate in consensus, or sync new blocks. More information will be provided via the Discord network announcement channel when available.
Shard 0 or shard 1 node doesn’t require that DB
Your commitment and cooperation in this migration process will contribute significantly to the success of HIP30v2.
Harmony remains committed to transparency, innovation, and community involvement. We look forward to embarking on this exciting phase together. Thank you for being an essential part of our journey.
For further updates and announcements, please stay tuned to our official channels.
The Harmony Team