Progressive Decentralization: The community now runs 66% of the network


This is 2411 - a new Community Manager at Incognito.
You will see my name more often from now on. I look forward to bringing many interesting updates to the community.
So excited!

Back to the main topic, we take a further major step towards decentralization as promised in the Incognito 2022 Technical Roadmap. Additionally, validators are now rewarded much higher.

To be more specific, the fixed slot dominance was first reduced from 22/32 (69%) to 22/48 (46%) in Apr 2022. Yesterday, we just did another upgrade, which further reduced the number of fixed nodes from 22 (46%) to just 16 (34%), out of 48 total slots.

It means that the community nodes now make up the majority of the network committee for block creation consensus. In other words, the network is truly run by the community and even the core team can’t make an invalid block without approval from the community.

31% at launch. 66% now.

6 more slots in each shard committee for the community nodes. As we have 8 shard networks, it is 48 more slots for the community in total!!!

Decentralization at its best!!!

As the fixed nodes only account for 34% of the network committee now, 66% of the shard committee mining rewards would go to the community.

With this upgrade, the mining rewards for validators go from 67% APR to 86% APR.

Happy powering privacy!


Which leaves the question. What exactly is the 34% of the rewards used for today? Is there any ledger over Incognito kept funds and expenses?

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Great question by @fredlee and I too would like to know if the the Incognito team plan to provide more transparency on what the rewards are being used for.

I’m of the opinion that Decentralisation & Transparency walk hand-in-hand, hence if Incognito is moving more towards a decentralised model (which is great), then the community should also be seeing more transparency coming from Incognito Team. This will help facilitate a smooth transition away from a centralised entity and more towards a community driven DAO in the future.

Speaking of transparency…
There was an excellent post by @maisie on PRV utility raised.
The idea was to increase the network fee to 0.1 PRV. There was some great discussion on this topic.

From what I gather, the fee has indeed increased to 0.1 PRV as I needed to increase my minimum balance to carry out a withdrawal from my pNode earlier today (thanks @Jared for your help).

I did not see any notification in the App about this fee change (or perhaps I missed something).

ON Maisie’s post, I proposed the following idea about whether a portion of the increased “Fee” could be set aside to fund a DAO Treasury rather than just burning the fee.
Q. @maisie / @duc / @Jayce_Nguyen any update on my proposed idea?

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I always thought the Treasury was used to pay the 21%-40% apy in Provide. As the rest of provide pays out in PRV, it’s likely coming from the same pot as well. Incognito also has paid positions, and it seems like recently they are adding people with more visibility on these forums. In the end though, whoever runs incognito could shut it down overnight as they control the app. Would not matter if the nodes running the network are decentralized if the app doesn’t work. I agree, more transparency is needed.

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That is correct. The APY has to be generated from somewhere.

There is a CLI (command line interface) available to directly interact with the Incognito blockchain, thus the app is not needed. The app is just a frontend to interact with the blockchain.

You can check it out here:

Here are the commands:

I consider this CLI to be easy enough for just about anyone to be able to figure out and use. :raised_hands:

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Good to know, maybe someone will write an alternative app or wallet.

At any rate, what’s to stop the core team from reversing the percentage and re-taking the majority of validators? It’s been seen recently that Incognito fundamentally has control and can change things like fees with little oversight.

I’m not sure I follow this?

This quarter (Nov - Jan), the devs plan on releasing a pDAO where PRV holders can vote on network changes. You can read upcoming changes on the roadmap: Incognito's Q4 2022: Technical Roadmap

Going back to 46% or 69% of validators provided by Incognito.

Even with pDAO, ultimate control will still lie with Incognito, or will the pDAO be required to make any changes?

Incognito is a community-driven project. It’s my understanding that all network impacting decisions will be voted on by the community via the pDAO.

Things like website design, app design, etc will probably not be included on there unless drastic. We will have more information about the pDAO soon and will have more through answers.

Yes, but unless it’s hardcoded as the only way changes can be made to the network, ultimate control will always lie with the Incognito team. With the recent rugpulls at Midas and elsewhere, I’m withdrawing all provide funds until I can feel a bit more secure with Incognito. I’m going to leave my validators running though, I feel it will be a good compromise versus pulling all my funds.


I understand. Please watch for our next few Privacy Newsletter Updates for more information regarding the pDAO.

@Linnovations and @fredlee

Writing such a long comment takes a lot of effort. I do appreciate that.
As a newcomer, I need time to gather information to address your concerns.

First of all, the core team only makes up 5% of the total PRV allocation. Compared to the 95% paid to the community, this is really a minority and ineffective. Note that the core team also needs funding to cover operational costs, research, and business expansion. You have been with us here for a while and the privacy ecosystem is getting more mature since then. There is no doubt that the rewards have been put to good use.

It goes without saying that for security reasons we should keep 34% of the fixed slots. To further explain, the market cap and stake value of PRV are still small, so we need to control a sufficient number of fixed slots to avoid creating invalid blocks.
To make it more decentralized, block proposal rights will be shared in a round-robin fashion. This means that community validators can propose new blocks, which is only done by fixed nodes for the time being. This was already mentioned in the technology roadmap here.

The next step is the decentralization of the Beacon Chain. As soon as the phase 2 of the Beacon decentralization is complete, the epoch’s rewards will be shared equally among all stakers in that epoch, regardless of whether the stakers are committee fixed nodes, community validators, or queued. Consequently, fixed nodes do not earn more rewards than community nodes as they do today.

When it comes to decentralization and transparency, our actions and results speak for themselves. Before we do anything, we always have a plan and the community is definitely notified in advance. After that, we will execute the plan firmly and connect it to the result, leading to the reduction of the number of fixed nodes and the increase of the mining reward.

As for missing notifications, it was my bad to miss this. A lesson is learnt. I truly apologize for the inconvenience.

We are also trying to use Twitter for more engagement. This news has already been updated and you can follow us on Twitter for the latest news. Notifications will definitely work next time.

Regarding your suggestion, you certainly submit your proposal to fund the DAO Treasury more as soon as pDAO is released, estimated next week.

Stay tuned!



The core team cannot arbitrarily change anything to the network without the consent of the community.

Take the increase in network fee to 0.1 PRV as an example.
This change will only apply when more than 75% of validators approve. Up until that point, the network fee remained the same.

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This is just fundamentally not true. The core team absolutely changed the fee arbitrarily and with authority. Maybe there needed to be consensus by the validators, but there is currently no mechanism for voting from the community. This may come with pDAO, but as I’ve said, unless the pDAO is programmed to not be reversible, the core team will always have absolute authority. I appreciate being given the chance to vote when pDAO goes live, I appreciate the chance to earn more validating. But all that can be taken away just as easily as it was given. For that reason, Incognito will remain custodial and I’ll view it as a risky platform to park liquidity. My hope is that eventually the core team will be able to give up their control and give it 100% to the community and make this 100% non-custodial and 100% governed by the community and have all validators treated equally. I understand the reasons for not being able to do that now, but moving forward is the only way I see that can promise the privacy of the network and also reduce risk for the actual user. Custodial services have proven to be very risky, even ones with doxxed developers, KYC, and contracts. I don’t think you’re gonna get people to buy in to this whole ecosystem if it remains custodial. I will be watching pDAO to see how that transpires, but as of now I’m in the process of unshielding all my tokens and will continuously swap my validator earnings to stable coins and unshield that as I earn it as well.


Mmmm. so I run several vNodes and I’m a technical novice, does my Nodes have a vote in the new fee proposal? If so, what needs to be done to participate in the vote?

But that aside, can someone please confirm, the fee structure has already gone up in the app, right?

@maisie / @2411 did the vote already take place?

Approve here means that your node is updated to the latest code version.

In other words, once you approve the proposal, you update the code of the node. If not, leave the node running normally without updating.

Regarding the fee, over 75% of the validators approved already and it is already in effect.

This is just fundamentally not true. The core team absolutely changed the fee arbitrarily and with authority. Maybe there needed to be consensus by the validators, but there is currently no mechanism for voting from the community.

As it has to be approved by at least 75% of the validators, it is impossible for the core team to make any updates without consent from the community.

Hey @2411, not sure if you know, but the latest script used to install Nodes automatically updates nodes. Have I got that right @Jared?

If this is correct, then there is no ability to opt-out as node automatically update, hence it will be a automatic “yes”.


Anyone can turn off this automatic updates by using the following:

sudo systemctl stop IncognitoUpdater.service
sudo systemctl stop IncognitoUpdater.timer

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Perhaps the reason why 75% agreed, was because by default nodes “automatically” update.

Don’t get me wrong, I’m not against the decision to raise fees, however, I am learning the process and that voting is a binary mechanism:

  • A) To DISAPPROVE and leave fees as is - DO NOT UPGRADE (pause automatic node upgrade)
  • B) To APPROVE and increase fee to 0.1 PRV - UPGRADE (No action needed)

IMO, it would have been nice to have a separate Forum Post specifically the vote to increase fee, how to vote and when the vote deadline will take place.
Perhaps I missed the notifications on social media, For me personally an email update would have been courtesy.

Btw, thanks @Jared for answering my question about Node Updates. I’ve learnt something new as I was not aware I could turn off automatic updates.