Lessons learned being a stakepool operator for 9 days

I’ve started a charity pool (RYOKU) 9 days ago which I retired tonight.

I wanted to contribute to the decentralisation of cardano and charity for dogs. I am a tech guy, not a marketing guy.

After starting the pool it became clear for me that the pool would not provide for the operational cost of running the pool, the stake provided +/- 15k. During the week I am an IT professional, in the weekend I am a dog trainer on voluntary basis. Doing marketing is not where I am here for.

Lessons learned:

Being late in the game makes it hard to start a pool (pledge/stake).
Running a stakepool is not about tech more about marketing.
I now know the architecture of cardano and details about operations.

If you start a pool make sure to team up or have solid marketing.

Enjoy!

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Were you running on cloud or baremetal?

Contabo vps… the specs where sufficient. Cloud is too expensive and bare metal isn’t needed to run a node.

This is not about tech/hardware it’s about pledge/stake.

I think the essence of it all is how to ensure decentralisation vs security. We want to be decentralized yet we don’t want small pools to be able to be bad actors to the chain.

Even if you are prepared to run a pool for altruistic reasons there is nothing worse than not actually getting to produce any blocks.

We want to support single pool operators because these are the ideal people who believe in decentralisation. People are working on ways to make things better for small pool operators. Nevertheless the cold facts will remain that your pool needs to have a certain percentage of total stake otherwise it won’t get awarded any slots. The only thing that can be done to help is to lower the barriers preventing small pool operators from growing their delegator stake.

See this thread:

I’m glad you were at least able to experience running a node. Its true, acquiring stake is a really tuff job. Marketing skills, partnerships, contributions, community building, or friends with deep pockets is pretty much a requirement right now. There are operators who have great success growing their pools, but they are usually working their butts off on growing them.

Its great you chose to contribute to dogs. I love dogs to no end, and I think its awesome you devote some of your free time to training/helping dogs adjust to our crazy human world. I think its a good cause.

I can’t know that sticking it out for longer would have bared fruit for you…as its not an easy path. I trust you made the right decision for yourself, and I commemorate your ability to make that decision in 9 days.

I hope you will revisit being an operator if parameters/conditions make it more feasible for you in the future.

Thank you for contributing to the Cardano ecosystem!

I’m running baremetal. The overheads are very low, just 100w of power running on quite humble servers. It has let me run my small pool for many months without a block, knowing that I will make some blocks, as some point.

It does all come down to economics. The economics of running one on cloud don’t’ stack up unless it is a big pool. And even then, you still don’t need to be running cloud.

Yes, this min fee issue is a big one for small pools. IOG discussed it a while back, but nothing has come of it since. I am hoping that once Vasil has occurred, the conversation can start again and we can get some traction to change it.

I started a pool over a year ago knowing that it may never make a profit but will contribute to decentralization. There are amazing people that maintain and run all sorts of infrastructure for free. Seed boxes, api’s open source projects are some examples.

Starting a stake pool can be risky financial move there are many benefits to IT professionals. However you don’t need to run an expensive VPS, running on a machine at home with 4 cores and 16GB RAM is a small barrier to entry (compared at least to POW mining etc).

I found some of the skills I’ve gained being an Cardano SPO to be extremely valuable to career as a software engineer. There are lots of unique opportunities for developers who are keen to build on Cardano and I hope they are not put of by this. Cardano pool marketing is hard and it does seem that larger pools are favored and can generate positive feedback loops (become multi-pools), but SPO are needed and should be encouraged.

Also 9 days… It took me two months before I got my first delegator :melting_face:

All the best though!

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@Jack7E your reasons for running a pool echo mine.

I disagree with pools being pressured to advertise. Advertise about what they do for the community and advertise about what causes they donate to. I donate to the free software foundation but I think this is irrelevant to the proper running of a stake pool.

I don’t run my stake pool so that I can donate. I run it to contribute to decentralisation because I believe in this future and because I want to learn more so I can continue to push in this direction. I also run the pool because I want to be prepared for future opportunities. Simply running my pool correctly and professionally without missing blocks is the aim and I will continue to do this whether it is profitable or not.

The main benefit from producing blocks for me is the positive feedback that I am doing things correctly. If I crunched the numbers, it would be better for me financially to simply stake with a large pool. But I don’t care because that is not why I run my stake pool. I have been running a mail server for 20 years and have never even charged for this service. That costs me money too but it provides other benefits.

In the long term I believe there will be many cost insensitive pool operators simply running pools as a service. I don’t think that running a pool in the long term will be a profitable business on its own. For many operators, a stake pool will just be one component of their wider activities. Running the stake pool will provide assurance or other advantages for that individual’s broader activities. This will be why that individual will be prepared to run the pool at a loss.

People seeking to make money from running a stake pool in the longer term should keep it in mind that there will be these cost insensitive operators.

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I like your reasons very much!

In order to contribute to decemtralisation, you still need to have enough stake to get to produce a block occasionally, though.

And it would still be good to change the minimum fixed fee to 0, so that delegators can get comparable (if maybe more unstable) rewards, when delegating to such a pro bono pool.

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Absolutely.

I don’t know how many cost insensitive pool operators there are. But, these operators are so dedicated to deliver a decentralised future that they work for free and are focused on the details. These are like the free software zealots that spend days reverse engineering things because they want to make sure they are doing something correctly. They don’t care about the cost, they care about correctness.

Now, I ask: Which stake pool operators do you want to have running the infrastructure?

The min fee of 340 Ada is hurting the ability of the zealots to really drive decentralisation. More people would stake with these zealots if the min fee was zero and we would become more decentralised.

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Hi

What kind of hardware are you using? Only 100W og power for 2-3 servers is admirable.

Just using SFF servers. You don’t need a full enterprise level server to run a cardano node. If you include the second relay, it is closer to 150w. Obviously that comes and goes depending on what is happening on the node at the time, but it isn’t hundreds of watts, that for sure.

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I am about to start stake pool / Cardano node. I am aware it will not get blocks until stake is high enough. Do you have recommendations how to start without spending too much money?

Reusing some small form factor machines is a good start. Check out the min specs needed and away you go.

Hopefully your ISP does a fixed ip, otherwise budget for some workaround. I use ngrok to get around my cgnat connection. All this comes into the budget.

But the biggest thing is marketing to get delegators. There are a lot of pools out there now and it’s hard to be heard and be attractive.

You can do some calcs on the expected rewards you will get given your own pledge and make sure it will cover your costs.

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How about less than 60W?

You can get one of these ARM boards: HoneyComb LX2 - Arm Workstation & Developer Platform | SolidRun

They can have 64G RAM and 16 Arm Cortex A72 cores at 2 GHz and power from PicoPSU mini-ATX supply. I have one currently powered by a 12V, 5A wall wart. Cost $800 US. Install linux on it and run multiple KVM virtual machines connected by a virtual bridge with good firewalling.

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yes I was also wondering the hardware specs as well. I prefer baremetal over cloud just cause I like to see the thing humming away in the room while I work…its sooooothing haha.

They’re pretty low. So anything better than this will work.