Worst case scenario for Stake Pool Operators

Staking & Delegation Operate a Stake Pool
1

Let’s say I had a low fee, and high pledge (1m+), and 100% uptime, but for 12 months, nobody delegated to my pool.

Would this mean I get a 0% return?

I’m asking to understand the worst-case scenario if I operate a pool, and if I’d be better off just delegating my stake.

Another question:
Am I correct in saying there are only ever staking returns if a staking pool actually creates a block?

2

Correct, rewards come from the creation of a block but even if you have no delegators, your 1m+ pledge will still count towards the stake in your pool and the corresponding probability to be allocated a block based on that amount.

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3

Thanks but what does this mean exactly? There’s still a CHANCE I wont make a block. And in that case, there’s no staking reward. Is this correct?

4

Current epoch the average stake required to make one block is ~2 - 2.5m stake (d=0.68), slots are allocated based on a lottery which depends on the amount of stake you have so there is no guarantee.

So with 1m+ in stake from your pledge on average you might get a block every 2 or 3 epoch but you might also get more or less lucky.

For each epoch you make a block you will get rewards, for epochs where you don’t make a block there will be no rewards.

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5

yeah you need stake to make blocks

once you spin up your pool you will want to put serious consideration and effort into accruing delegation

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6

Is there any chance by luck you get to make a block even without delegetors?

7

There’s always a chance if the pool has pledged (or has stake amount) > 0.

Depending on stake it might take awhile.

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8

Nope, you will earn around 6% yearly ROI.

Yes, but imagine this example. You have only 1m pledge and nothing else and assume you will create a block only in every 3rd epoch (due to that 1m pledge) that means you wont get rewards in two epochs but much higher in the 3rd (around triple of the expected), which would average out for that ~6% ROI per year. Hope it makes sense.

9

Of course assuming your pool creates its blocks when it is scheduled, i.e. online 24/7 and not loosing any blocks for different reasons (slot or height battle etc.)