Slashing refers to a mechanism designed to ensure network security and penalize validators (or their delegators) who act maliciously or negligently. Here are the associated risks (note that “validator” refers to our validator partner and “delegator” refers to our users that stake funds):
Risks Associated with Slashing
- Partial Loss of Funds: When slashing occurs, a percentage of the validator’s staked funds is forfeited. If you have delegated your funds to a slashed validator, you may also experience a reduction in your staked amount.
- Reduced Rewards: Slashing may also affect the rewards earned by the validator and their delegators, reducing the expected return.
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