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by starburst
May 20, 2023

Validators rewards and penalties

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OnPulseChain, validators play a crucial role in maintaining network security, reaching consensus, and validating transactions. Their activity is directly connected to the economics of the chain, mainly PLS andgas. This article explores the rewards and penalties associated with being avalidator, shedding light on the incentives that drive participation and ensure the integrity of the network.

Validator balances

Gasper is the algorithm that governs everything the validators do. It has a preference for validators with high effective balances, which means that the nodes with a higher effective balance have a higher probability of being chosen to propose blocks or participate in sync committees. This is to disincentivize the validators that have been penalized or slashed and favor those who behave well. There are two separate records of each validator’s balance:


  • Actual balance: This is the actual balance of each validator. This includes:
    • the deposit they made to the deposit contract, 
    • rewards they earned for participating in the protocol, 
    • penalties for inactivity. 
  • Effective balance: This is a number derived from the actual balance, but it’s designed to only change once per epoch. It’s capped at 32 million Pulse, so a validator’s actual balance could be 100 million PLS, but his rewards and penalties are a function of his effective balance, which is capped at 32 million Pulse.

Validator rewards

In PulseChain, the rewards are designed to incentivize active participation and encourage validators to follow the protocol rules. The following reward mechanisms are available:

  1. Block Rewards: Validators can earn block rewards for successfully proposing new blocks. These rewards happen every epoch and make up most of the validator’s rewards. They consist of newly minted Pulse (PLS) and transaction fees associated with the included transactions. Each validator gets block rewards proportionately to his stake, which refers to the amount of PLS they have committed as collateral and to a
  2. Transaction Fees: Validators are entitled to receive a portion of the transaction fees associated with the transactions they include in the blocks they propose. This part of the transaction fee is called the “priority fee”. It serves as an additional incentive for validators to include as many transactions as possible and prioritize those with higher priority fees.
  3. Participation in the sync committee
  4. Inactivity Penalties Redistribution: Validators who fail to carry out their responsibilities or go offline may face inactivity penalties. These penalties are redistributed to active validators in proportion to their stake, ensuring that the network remains secure and incentivizing consistent participation.
  5. Deposit Interest: Validators are also entitled to earn interest on their deposited stake over time. This mechanism encourages validators to maintain a long-term commitment to the network and discourages malicious behavior.

What are the rewards for

PulseChain validator rewards are given for attestations, proposing blocks, and participating in sync committees. Attesting to a block means that a validator attests that a block is consistent with the majority of other validators. It happens every epoch, while proposing a block happens from epoch to epoch as the validator is randomly chosen to propose a block. Participation in sync committees is infrequent, depending on the size of the pool of validators. 

You can follow validators leaderboard, penalties, rewards, and individual data on

How are rewards calculated

A validator receives a “base reward” per epoch. It’s dependent on the effective balance defined above and on the number of validators in the network. The higher the effective balance, the more the rewards, and the more validators to share the rewards with, the less the rewards. The function used to calculate the base reward is: 

base_reward = effective_balance * (base_reward_factor /        (base_rewards_per_epoch * sqrt(sum(active_balance))))  

  • Base reward factor is 64
  • Base rewards per epoch is 4
  • sum (active balance) is the total staked ether across all active validators

Different tasks carry different weights when it comes to reward attribution, and the final reward is calculated by multiplying the base reward by the sum of the weights applicable to that validator and then dividing by 64. 

Participation in the sync committee every 256 epochs (27.3 hours) brings high rewards for the 512 validators randomly chosen to be a part of it. The fewer the validators, the greater the probability of obtaining the rewards.

Validator penalties

Validators in PulseChain are subject to penalties to deter malicious or negligent behavior that could compromise the security and integrity of the network. These penalties are designed to encourage validators to act honestly and follow the protocol rules. The penalties are inflicted for:

  • missing, late, or incorrect attestations. The penalty is equal to the missed reward. The penalties for being inactive, unresponsive, late, or incorrect increase quadratically over time to reduce the stake of poorly performing validators who reduce the network’s performance.

PulseChain subtracts penalties from a validator’s balances on the beacon chain and burns them, reducing the net issuance of Pulse.


Slashing refers to the reduction or confiscation of a validator’s stake as a penalty for violating the protocol rules. There are two types of slashing conditions:
a. Liveness Violation: Validators who fail to perform their duties, such as proposing blocks or attesting to the validity of blocks, may be slashed. This penalty ensures that validators actively participate in the consensus process.
b. Safety Violation: Validators who engage in malicious activities, such as double-signing or attempting to manipulate the consensus process, can face slashing penalties. This penalty protects the network from attacks and discourages validators from acting against the network’s interests. 

  1. Voluntary Exit Penalties: Validators who voluntarily exit the network may face penalties to prevent sudden mass exodus or other undesirable behavior. These penalties are applied to the validator’s stake and help maintain the stability and continuity of the network.
  2. Collateral Loss: In extreme cases of repeated malicious behavior or failure to fulfill obligations, validators may lose their entire deposited stake. This severe penalty serves as a strong deterrent against actions that could harm the network.
  3. Public Reputation: Although not a direct penalty mechanism, a validator’s reputation can be negatively impacted by malicious behavior. This can lead to decreased trust, reduced participation, and exclusion from future validation opportunities.

Difference from Ethereum

PulseChain has a change in its protocol, which is different from Ethereum. There’s a slight reduction in block times from an average of ~12 seconds in Ethereum’s PoS to 10 seconds in PulseChain. Additionally, the users cannot stake their PLS and earn a part of the validator’s rewards. Other difference betweenPulseChain and Ethereumis that PulseChain burns PLS at a faster rate than Ethereum burns ETH. 


Validators in the Ethereum PoS chain play a vital role in maintaining network security and consensus. Incentivizing their participation and ensuring adherence to the protocol rules are essential for the network’s success. The rewards offered to validators, such as block rewards, transaction fees, and deposit interest, encourage active participation and commitment. Conversely, penalties, including slashing, inactivity penalties, and collateral loss, discourage malicious behavior and enforce the network’s integrity.

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