Alkimi Validators 101: Understanding the Role of Validators in Alkimi’s Ecosystem

Alkimi Validator Network 101

The article here provides essential FAQs about validators in the Alkimi Exchange, including their role, setup requirements, and the upcoming Validator Waitlist. It outlines how the waitlist will facilitate access to the network and promote fairness and inclusivity within our decentralized ecosystem.

Generic Questions:

1. What is the role of Validators in Alkimi Exchange?

Validators are processing units operated by Alkimi’s community members and partners. They enable Alkimi and its partners to run various processing and storage operations, facilitating efficient transactions within the Alkimi ecosystem.

These validators can be set up on cloud platforms like AWS, GCP, or Digital Ocean and personal computers. They are paid in FIAT by users who own them, in exchange for rewards distributed in $ADS tokens. This creates a cost-effective way for Alkimi to access computing and storage resources.

Validators play a critical role in the Alkimi Exchange (AlEx) decentralised infrastructure, validating and notarising transactions on the distributed ledger. They provide the transactional bandwidth necessary for buying and selling digital ads efficiently.

To operate a Validator, participants need to acquire the prerequisite amount of $ADS and exchange it for a “Soul-bound Validator NFT.” This non-transferable token can be redeemed for $ADS through a smart contract, with a short delay to maintain network uptime. The estimated monthly cost to run a Validator is around $24, though this may vary based on project requirements and network needs.

2. What can Validators be used for?

Validators can be used as decentralised processing units to run any type of processing including reporting engines, ad exchanges, ad servers, Prebid servers, or any bespoke application.

a. They can be used as decentralised data storage to store data that is a result of any processing, log-level data, etc.

b. They can be used as part of a consensus mechanism to get multiple validators to carry out the same processing on a given data set, with the aim of reaching a result that every validator agrees on.

3. How is it beneficial to Alkimi’s partners?

Alkimi and its partners can use this network of independent validators to outsource their processing, thereby reducing their cloud infrastructure costs without compromising security, privacy or compliance with regulations. Alkimi’s partners who own their bare-metal servers can work with Alkimi to tokenise their infrastructure. This will enable them to reduce and delay their cloud computing payouts, as this would be funded by Alkimi’s validators (in exchange for rewards in $ADS tokens).

4. How does Alkimi ensure compliance with regulations?

We provide utmost importance to compliance with regulations. This is done by following the below steps. a. We work with the partner/client to understand their requirements — their business needs, what they are looking to achieve, their pain points, the type of data that is being processed, the type of processing to be carried out, the sensitivity and confidentiality of the data, the location of the data, the privacy regulations to be complied with, etc. Once this assessment has been performed, a complete plan is shared with the partner to ensure that the data is located in a region that complies with the regulation, appropriate data sharing agreements are drafted and signed, appropriate SLAs are agreed and necessary controls are put in place to ensure continued compliance with regulations.

5: How can I become a Validator?

As exchange traffic increases, we’ll onboard new validators to help process additional transactions and earn revenue. To get started, you need to follow the below-mentioned steps:
1. Account Registration: Register your account on Alkimi Labs and KYC.
2. Token Requirement: Ensure you hold 50,000 ADS tokens in your wallet. These tokens will be used as collateral to mint an NFT.
3. Receive Validator NFT: Upon meeting the token requirement, you will receive an inactive Validator NFT.

6: How do I register on Alkimi Labs?

Here’s a quick guide on how to register on Alkimi Labs to become a Validator:
1. Go to https://labs.alkimi.org/.
2. Connect Your Wallet
3. Register Your Account: Enter your full name (ensure it matches your identity proof for KYC) and email address.
4. Save Your Recovery Phrase: You’ll be given a “Recovery Phrase,” similar to a seed phrase. This is crucial for account recovery, so store it safely.
5. Verify Your Email: You’ll receive an OTP on your email.
6. Complete KYC Verification: After registration, click on the “User” button, go to your account, and select “Verify KYC.”
7. Ensure KYC Verification: Complete your KYC to be eligible for the waitlist.

7: Why do I need to KYC? Is it mandatory for everyone?

You don’t have to be KYC verified unless you want to stake your LP tokens or run a Validator to earn your share of Alkimi’s growing revenue. As a registered company, dealing with large global corporations, Alkimi has to satisfy AML and relevant regulations to distribute revenue.

Currently, it is not possible to run a validator from anywhere in the world; please check the terms and conditions to get more details on this.

If you are submitting KYC from a country that is prohibited from operating a validator but are currently residing in one of the allowed regions, please follow these steps:

1. Submit KYC for Your Current Country: Use your residency to guide your KYC submission. For example, if you were born in Yemen but now live in the UK, please submit KYC documents that reflect your UK address, not your Yemeni passport.
2. Ensure All Documentation is Accurate: Make sure that all submitted documents clearly indicate your current residency to avoid any delays in processing.

8: How do I complete my KYC?

1. Access the KYC Section: Log in to your account on Alkimi Labs.
2. Navigate to the “Personal Information” section in your account settings.
3. Initiate Verification: Click on the “Verify” button located next to the “Not Verified” KYC block.
4. Prepare Your Documents: You will need one of the following documents:

• Passport
• National ID
• Driving License

9: What is the Validator waitlist for?

The Validator Waitlist is a system designed to manage access to the Alkimi Validator Network. This waitlist facilitates a phased approach to ensure a smooth transition to full public access while maintaining order and inclusivity in our decentralised ecosystem.

Key Features of the Validator Waitlist:

• Initial Access: The first phase will grant access to those holding more than 200K $ADS tokens, allowing large-scale investors and stakeholders to participate early.
• Public Access: After the initial phase, the waitlist will open to everyone holding 50K $ADS tokens, allowing broader community participation.
• Purpose of the Waitlist: The waitlist helps ensure that access to the Validator Network is organised and equitable, enabling a smooth rollout as we transition from initial to public access. This structure promotes fairness and inclusivity within the network.
• Decentralisation Commitment: Alkimi is dedicated to decentralisation, aiming to distribute power and control across a broad network to enhance fairness and inclusivity.

10: How do I Mint an NFT to join the waitlist?

Once you are registered and KYC verified, you are ready for the minting process. Here’s How to Mint an NFT on Alkimi Labs;

1. Access the Validator’s Page:
   - Navigate to the Validator’s Page on Alkimi Labs.
2. Choose the Minting Option:
   - Click on “Become a Validator” if you haven’t minted any NFTs yet.
   - Click on “I Already Have NFT” if you have previously minted NFTs and want to assign a service type to the NFT.
3. Note:
   1. If you need to mint a new NFT, select “Become a Validator”.
   2. Ensure you have at least 50,000 $ADS tokens in your wallet. If not, you will be prompted to select an exchange to purchase $ADS tokens. Compare prices on different exchanges before making your purchase.
4. Initiate the Minting Process:
   - Click on the “NFT Mint” pop-up to begin minting your validator NFT.
5. Specify the Number of NFTs:
   - Enter the number of NFTs you wish to mint.
   - Ensure you have sufficient $ADS tokens and ETH in your wallet to cover the gas fees.
6. Agree to Terms and Conditions:
   - Read the terms and conditions provided, then click the “Mint Now” button.
7. Approve Transaction in MetaMask:
   - MetaMask will prompt you to confirm the transfer of 50,000 $ADS tokens per NFT.
   - Review the details and click “Approve” to authorise the transfer. Please note that in this step your collateral will be moved to a treasury wallet.
8. Completion and Confirmation:
   - Upon successful minting, you will receive an NFT ID. A confirmation message “NFT Minted” will be displayed on your screen.
   - MetaMask will also show a prompt confirming the successful minting.
9. Select Validator Services:
   - You will be redirected to the “I Already Have an NFT” screen.
   - Here, choose between Delegated Service or Self-Service. Assign the validator any service type basis your preference.
   - Select the appropriate service for your minted NFTs from the dropdown menu, changing the status from “None” to “Self-Serve” or “Delegated”.
10. View Your NFT:
    - Navigate to the “My Validators” page.
    - You will see your minted NFT listed along with its NFT ID, status, Queue Number, and Service Type.
    - The Queue Number indicates your position in the waitlist. You may see pending validator requests but no registered validators yet.
11. Note: Keep an eye on your position and any updates related to your validator services.

11: Why are the tokens that I have provided as collateral being transferred from the smart contract to another treasury wallet?

When a user signs up to be a validator on the Alkimi network and mints an NFT, they interact with the smart contract via the Alkimi Labs platform, the smart contract performs multiple actions — accepts collateral (50,000 $ADS tokens) from the user’s wallet, transfers the collateral to a wallet that the Admins (In this case, Alkimi) designate as the Treasury Wallet and mints an NFT to the user’s wallet.

Before the NFT is minted, the collateral is moved from the Smart Contract to a Treasury Wallet and the most prudent reasons for this are:

• Even when a smart contract is rigorously tested and audited by a third-party auditor (like we have ensured (Link to the audit), the risk of the smart contract being compromised cannot be ruled out. In the event of such a scenario, the attacker can drain the funds that are left in the smart contract wallet.
• If any external library used by the smart contract has any vulnerabilities, it could be exploited by an attacker to attack the smart contract and drain any funds left in the smart contract wallet.

The most effective theoretical approach is that funds should always be left in the smart contract and the smart contract owner should relinquish ownership to ensure that nobody can move funds away from the contract and only authorised users can reclaim their funds by interacting with the functions supported by the contract.

This approach though theoretically sound lacks real-world business applications. For example, this would significantly affect the much-needed configurability for the Alkimi Validator program, where the business may need to create multiple versions of validators with lower/ higher collaterals, alter the total supply for each version of the validators, etc. based on its needs. Relinquishing ownership/ admin rights would take away the ability to configure the contract based on business and market needs.

This approach would also not be able to handle the risks associated with the smart contract being compromised or vulnerabilities in any external libraries used.

12: What are the different types of Validator services?

There are two types of Validator services:
1. Self-Serve Validator : Validators that are completely owned and operated by an independent set of users. This is called a Self Serve Validator and is ideal for tech-savvy validators with the experience and time to manage a validator.
2. Delegated Validator: Validators that are owned (fully or fractionally) by an independent set of users but operated by a trusted party, such as Alkimi. This is ideal for users who are eager to join the network but don’t have the expertise or the time to maintain and operate a validator.

13: What is the purpose of Alkimi’s Delegated Validator Service?

The Delegated Validator Service is designed to simplify participation in the Alkimi network by allowing users who may not have the technical expertise or time to run their own validators. This service enables more people to contribute to the decentralised ad exchange ecosystem without managing the technical complexities. It’s offered at $95 per quarter, covering Alkimi’s operating costs, personnel, and payment handling fees, rather than being profit-driven.

Technical and Operational Aspects

1: Are there specific requirements or limits on the number of delegated validators?

There is no fixed requirement to use delegated validators, nor is there a defined number of delegated validators needed to run the network. Alkimi offers both delegated and self-serve validators to accommodate different preferences and needs within the community. Separate waitlists exist for each type to streamline the onboarding process.

2: What does the $95 per quarter fee for the Delegated Validator Service cover?

The fee covers Alkimi’s operating costs, including infrastructure, personnel, and payment handling. This fee structure ensures that the service is sustainable and reliable but not profit-driven. The goal is to keep the service accessible while maintaining high standards of performance, support and importantly up-time.

3: How does Alkimi ensure transparency and security in its network operations?

Alkimi is committed to maintaining a transparent and secure ecosystem. To achieve this, a comprehensive smart contract audit will be conducted. Additionally, Alkimi plans to enhance transparency for the Ads Explorer in Q4, providing more visibility on APIs, similar to platforms like Etherscan. These steps are part of Alkimi’s ongoing efforts to build trust and confidence within the community.

4: How does Alkimi view the role of the community in shaping the future of the ad exchange industry?

A: Alkimi strongly believes in the power of its community to drive innovation and shape the future of the ad exchange industry. The network’s success is built on the active engagement and contributions of its community members. By offering flexible participation options and continuously seeking feedback, Alkimi aims to empower its community to play a central role in evolving the ad exchange landscape.

5: Can I run a mix of self-serve and delegated validators?

Yes, you can operate a combination of both self-serve and delegated validators. The waitlist process is the same for both types, and you can choose your preferred validator type during the application process.

6: Can I cancel my request to run a validator?

Yes, you can cancel your request at any time. Simply use the reclaim button while on the waitlist to request a return of your collateral. Alternatively, you can choose to become a Liquidity Provider by staking your assets into our Liquidity Pool. The reclaim fee is set to 0.005 ETH. Please note that this fees is at the point of collateral reclaim, not at minting the NFT.

7: Can I switch between running a self-serve and delegated validator?

Switching between self-serve and delegated validators is possible. However, we recommend making this decision before minting a validator NFT to avoid incurring gas fees related to burning and minting a new NFT.

8: How do I determine if becoming a validator is right for me?

You can assess the potential rewards of becoming a validator by using the reward estimator available at Alkimi Labs. This tool allows you to calculate your estimated quarterly rewards based on current network metrics, helping you make an informed decision.

Questions? Send them our way, and we’ll do our best to get them answered.

If you want to be a part of Alkimi’s journey or if you are interested in learning more about us, you can check out our socials and join us on Discord & Telegram!