In collaboration, Meta Pool, Linear, Hot, and Gauntlet are sharing two draft proposals—HSP002 and HSP003—for open discussion. This post serves as a Request for Comment (RFC) to gather insights and feedback from validators, token holders, and the broader community. No voting will take place at this stage. The aim is to collect constructive input and refine the proposals before submitting them to the House of Stake for formal consideration.

Active community participation is essential to ensure these proposals align with the principles of decentralization and contribute to a resilient, transparent, and healthy ecosystem. Your perspectives help shape decisions that strengthen the long-term sustainability of the network.

Frontmatter

hsp: 002
title: Validator Support Program
description: Quarterly support payments to maintain validator
decentralization post-inflation reduction
author: Meta Pool, LiNEAR, HOT
contributor: Gauntlet
status: Draft
type: Decision
category: Economic Governance
created: 2025-10-10

Abstract

This proposal establishes an initial one-quarter validator support program to maintain network decentralization following the planned NEAR protocol inflation reduction from 5% to 2.5%. The program provides 150 NEAR per quarter to the 100 smallest validators who maintain 97% uptime. This proposal covers only Q4 2025; continuation beyond the first quarter will require a subsequent proposal. The proposal depends on the inflation reduction being implemented but does not itself implement that change.

Situation

NEAR Protocol will undergo an inflation reduction from 5% to 2.5%, decreasing validator rewards by approximately 50%. This change is being implemented at the protocol level outside of the House of Stake proposal process. However, the economic implications for validators require a governance response to maintain network decentralization.

While larger professional validators can likely absorb this reduction, smaller and independent validators may find it challenging to maintain economically viable operations at the lower reward levels.

Research conducted by Meta Pool indicates that typical NEAR validator hardware costs under USD $700 per year. At the reduced inflation rate, some smaller validators may find their operations unprofitable, potentially leading to validator consolidation and reduced network decentralization.

Network decentralization is essential for NEAR’s security, resilience, and credibility. A diverse validator set protects against single points of failure, geographic concentration, and governance capture. If smaller validators exit due to economic constraints, the network risks becoming more centralized around a few large, professional operators.

This proposal addresses this risk by providing targeted support to smaller validators during the transition to the new economic model, ensuring they can continue contributing to network security and decentralization.

Mission

Objectives:

• Maintain or increase validator decentralization during the first quarter following inflation reduction

• Ensure smaller validators can continue economically viable operations during the transition period

• Support network security through a diverse validator set

• Gather data on program effectiveness to inform potential continuation proposals

• Cover operational costs for qualifying validators

Outcomes (First Quarter Only):

• 100 smallest validators receive adequate support to maintain operations in Q4

• No significant reduction in validator count or geographic diversity during transition period

• Stable network security metrics (uptime, participation rates)

• Data collection and evaluation to inform follow-on proposals

• Demonstration that inflation reduction can coexist with strong decentralization

Note: This proposal covers only the initial quarter following inflation reduction. Any continuation of the validator support program beyond Q4 will require a new proposal based on the outcomes and learnings from this pilot period.

Approach

The validator support program operates for one quarter (Q4 2025) with retrospective payment based on performance. This structure incentivizes consistent uptime while providing immediate support during the critical transition period following inflation reduction.

Q4 Program Structure (This Proposal)

One-Time Payment: 150 NEAR per qualifying validator, distributed at the end of Q4 2025.

Eligibility Criteria:

1. Stake Size: Bottom 100 validators by staked amount at the start of Q4

2. Performance: Maintain average 97% uptime throughout the 3-month period

3. Exclusions: Validators receiving incentives from other NEAR Foundation, Linear Protocol, or Meta Pool programs are ineligible to avoid double-subsidization

Assessment Process:

1. Snapshot taken at start of Q4 to identify the 100 smallest validators by stake

2. Uptime monitored continuously throughout the quarter

3. Final evaluation at end of Q4 determines which validators met 97% uptime threshold

4. Payments distributed to qualifying validators within 14 days of quarter end

Future Quarters (For Reference Only)

The sections below outline how a continued program might operate to provide context for long-term planning. However, quarters beyond Q4 are NOT included in this proposal and will require separate governance approval.

Potential Ongoing Structure:

• Quarterly payment cycles with same eligibility criteria

• Regular reassessment of payment amounts, validator counts, and thresholds

• Adaptations based on changing network conditions and NEAR price

Potential Annual Budget: Approximately 100,000 NEAR if program continues for full year with similar parameters (see Budget section for detailed breakdown).

Rationale

150 NEAR per quarter (600 NEAR annually) provides ~$1,800 USD per year at current prices, substantially covering the hardware costs identified by Meta Pool research. This amount ensures validators remain profitable even with 50% reduced staking rewards.

Bottom 100 validators targets those most at risk from reduced rewards while maintaining manageable program size and cost.

97% uptime requirement ensures the program supports reliable validators who contribute meaningfully to network security, not just those running minimal infrastructure.

Quarterly assessment allows the program to adapt to changing conditions without requiring new governance proposals for minor adjustments.

Risks and Limitations

Sybil Risk: Large validators could theoretically split their stake into multiple small validators to game the program. However, the 97% uptime requirement and operational overhead make this less attractive than legitimate operation. The program will monitor for suspicious patterns.

Validator Dependence: Validators may become dependent on the subsidy rather than building sustainable business models. The Q4 pilot with required follow-on proposal provides a natural decision point to assess whether continued support is necessary or whether the ecosystem has adapted to the new reward structure.

Geographic Diversity Not Addressed: This program focuses on stake size, not geographic distribution. Future proposals may address geographic decentralization specifically.

Market Price Volatility: The 150 NEAR payment may become insufficient or excessive as NEAR price changes. The Q4 pilot provides data to inform appropriate payment levels for any continuation proposal.

Technical Specification

Payment Calculation

For each quarter:

1. Identify bottom 100 validators by stake at quarter start (snapshot at first epoch of quarter)

2. Monitor uptime for each validator throughout 3-month period

3. Calculate average uptime as: (epochs validated / total epochs in quarter)

4. Validators with ≥97% average uptime qualify for payment

5. Distribute 150 NEAR to each qualifying validator within 14 days of quarter end

Exclusion List Management

Validators excluded due to participation in other incentive programs:

• NEAR Foundation incentive recipients

• Linear Protocol subsidy recipients

• Meta Pool support program participants

The exclusion list will be maintained publicly and updated at the start of each quarter. Validators may appeal exclusion decisions through a simple process to be defined by program administrators.

Uptime Monitoring

Uptime will be calculated using on-chain data from NEAR’s existing validator monitoring infrastructure. No new monitoring systems are required. Uptime percentage = (number of epochs with produced blocks / total epochs in period).

Implementation Timeline

This proposal covers Q4 2025 only. The timeline assumes the inflation reduction has been implemented or will be implemented concurrent with this program launch.

• Q4 2025 Start: Program launches, eligibility snapshot taken

• Q4 2025 End: Final evaluation, payments distributed

• Post-Q4: Comprehensive evaluation report published

• Before Q4 End: Follow-on proposal should be submitted if continuation is desired

Any continuation beyond Q4 requires a new House of Stake proposal.

Backwards Compatibility

This proposal introduces a new off-chain payment program and does not modify NEAR protocol itself. It has no backwards compatibility implications for the network.

Critical Dependency: This proposal depends on NEAR’s inflation reduction from 5% to 2.5% being implemented at the protocol level. The inflation reduction is happening outside of the House of Stake governance process, but this validator support program is only economically necessary and justified if that reduction occurs. If the inflation reduction is not implemented, this proposal becomes unnecessary as validators will continue receiving current reward levels.

Timing: This proposal should be approved and implemented concurrent with or immediately following the inflation reduction to provide uninterrupted support during the transition period.

Milestones

Budget & Resources

Q4 Budget (This Proposal)

Funding Source: NEAR House of Stake Foundation Treasury

Cost Notes:

• Actual Q4 costs may be lower if fewer than 100 validators meet the 97% uptime requirement.

• If all 100 validators qualify, direct payments total 15,000 NEAR.

• The remaining 5,000 NEAR covers administrative overhead and contingency.

Projected Annual Budget (For Reference Only)

(Not part of this proposal)

Any support beyond Q4 requires a new governance proposal with updated targets, budgets, and mechanisms based on Q4 results.

Reporting

End of Q4 Report (within 30 days of quarter end):

• Number of eligible validators at Q4 start

• Number of qualifying validators (met 97% uptime)

• Total payments distributed

• Validator count and decentralization metrics

• Geographic distribution analysis

• Program effectiveness evaluation

• Recommendations for potential continuation

• Cost-benefit analysis

This comprehensive report will inform any follow-on proposals for Q2 and beyond.

Team & Accountability

Responsible:

• NEAR House of Stake Foundation: Program administration, payment distribution, reporting, oversight and approval of program adjustments

Accountable to:

• House of Stake governance

• NEAR validator community

Program Administration:

• Validator eligibility determination for Q4

• Uptime monitoring and calculation throughout Q4

• Payment processing at end of Q4

• End-of-quarter comprehensive reporting

• Community communication about program status and results

Governance of Continuation:

• This Q4 pilot runs as approved; no mid-quarter adjustments without emergency proposal

• At end of Q4, program automatically concludes unless new proposal is approved

• Follow-on proposals for Q2+ should be submitted before end of Q4 to allow discussion time

• Any continuation proposal should incorporate learnings from Q4 pilot

Security Considerations

Economic Security

Program Sustainability: The 20,000 NEAR Q4 budget represents approximately 0.002% of NEAR’s total supply, a negligible impact on token economics. At current prices, this is roughly $60,000 for the quarter to support network decentralization during a critical transition period.

If the program continues for a full year at similar scale (illustrative 100,000 NEAR annually), it would represent approximately $300,000 annually to support decentralization—still a minimal cost relative to the value of maintaining a diverse validator set.

Validator Economics: By covering operational costs for smaller validators, the program reduces the risk that validator consolidation could compromise network security. The 97% uptime requirement ensures supported validators actively contribute to network operation.

Budget Risk: If NEAR price increases significantly, the program may become more expensive in USD terms. Conversely, if price decreases, 150 NEAR may become insufficient. Quarterly reviews allow adjustments.

Gaming and Abuse

Sybil Attacks: The program’s design makes it economically unattractive for large validators to split their stake, as:

• Each “fake” validator requires separate infrastructure and maintenance

• 97% uptime across multiple small validators is operationally challenging

• The program pays the same 150 NEAR regardless of stake size

• Administrative overhead and monitoring will flag suspicious patterns

Uptime Gaming: Validators cannot easily game the 97% uptime requirement as it’s calculated from on-chain block production data over 3 months. Short-term uptime manipulation would be evident and could result in disqualification.

Exclusion List Gaming: Clear criteria for other incentive programs will be maintained to prevent validators from appearing to exit other programs to qualify for this one.

Decentralization Impact

Positive: The program directly supports network decentralization by enabling smaller validators to remain operational despite reduced rewards.

Monitoring Required: The program should track whether it actually maintains validator diversity or creates perverse incentives. Annual evaluation will assess real decentralization impact.

Copyright

Copyright and related rights waived via CC0.

Disclaimer

Gauntlet is currently partnered with the Near Foundation to provide mechanism design and economic analyses. Our scope pertains to incentive design and infrastructure optimization, while other authors of this document drive the other scopes of work.

In these times of change, it is essential that the community support those responsible for network decentralization and security. Proposals from experts and those familiar with the economic aspects of node management are needed, so the community welcomes comments and suggestions that will enhance the proposal

There’s no “planned NEAR protocol inflation reduction from 5% to 2.5%”, Linear & Hot have already made a proposal (with questionable legitimacy) and it got rejected by voters. If we assume they resubmit the same proposal and it gets passed, I don’t like selecting a number of “smallest” validators. In this proposal sybil risk seems like an afterthought, while it’s the most important one, one can easily launch 30 validators to get $54,000 per year and spend less than $500 on hardware, and it will be impossible to identify them given the “sybil risk” mitigations provided.

Maintaining 97% uptime is too easy, that gives you more than 2 days of being fully offline every quarter. Even with 100% uptime (as calculated in this proposal), NEAR allows for 2-3 hours of downtime per epoch without losing validator seat or rewards, so it’s insanely easy to get 100% uptime. The “operational overhead” of spending 5 minutes to update the node once every 1-2 months (or with metapool’s node studio, it’s literally 1 button click: https://www.youtube.com/watch?v=YXdAhuEwmSE) is just negligible. And of course, if you can operate one validator, operating multiple of them is much easier since you have to only learn the tech once, and then use it many times.

Also, I think 150 NEAR per quarter is way too much, metapool themselves are recommending a $14/month hosting for node studio.

I want to be clear upfront:
I’m not writing this to debate whether staking emissions should be 5%, 4%, or 3.25%.

At this point, I’m not even concerned about the emissions rate itself.

What concerns me — and what should concern anyone who values NEAR’s long-term credibility — is how this emissions reduction is being pushed:
Not through open debate.
Not through explicit, standalone consensus.
But by quietly bundling it into a Nearcore upgrade and then presenting it as a done deal.

⸻

Governance isn’t just about outcomes — it’s about process

This is not how serious decentralized protocols make economic decisions.
• The emissions change was not voted on directly by the community in a clear, binding proposal.
• It was embedded in a protocol upgrade, with no clean opt-out path for validators who disagree.
• A large portion of the stake abstained, citing legal and compliance concerns — and that abstention is now being spun as silent approval.

If this is what passes for “governance” now, the word has lost its meaning.

⸻

We shouldn’t normalize this

Even if some think the emissions reduction is economically justified, the way it’s being handled sets a dangerous precedent:
• That protocol-level monetary policy can be changed without clear consent
• That abstention = consent
• That validator silence or exit is as good as approval
• That post-hoc proposals (like HSP002/003) can retroactively justify something already being slipped through

This is not decentralization. This is narrative control wrapped in protocol commits.

⸻

And no, it hasn’t happened yet — which is why this matters

Let’s be clear: this isn’t about complaining after the fact.
The upgrade hasn’t been finalized. It can still be opposed.
This is exactly the time to speak up — because once this gets normalized, you won’t be able to unring this bell.

⸻

What needs to happen now
• Unbundle monetary policy from protocol upgrades — permanently
• Require explicit votes for core tokenomics changes, with quorum and clarity
• Treat abstentions as abstentions, not consent
• Respect validator independence — not just in words, but in how changes are presented and voted

If emissions cuts are the right decision, make the case. Run the vote. Accept the result.
But don’t sneak it in under the hood and call that governance.

⸻

This isn’t about emissions anymore.
It’s about protecting the integrity of how NEAR makes decisions.

That still matters — and if we care about decentralization, it has to matter more than ever right now.

I think there are some misunderstandings here. The release which contains a standalone change to the protocol inflation is the process through which voting happens. Even if there is some other voting process, eventually validators need to adopt some release so that the change takes effect on the protocol level. Since the mainnet launch, the protocol has a built-in mechanism to decide whether a new protocol version gets adopted or not through voting by validators. More importantly, the protocol requires 80% of the stake to adopt the release for it to take effect, which is a very high bar. That has been the case for all releases historically and nothing changes there.

Thanks Bowen. Just to clarify — what happens to validators who don’t upgrade to the new version? Are they still able to stay in consensus and continue producing blocks?

Or does non-adoption mean they fall out of sync with the chain?

Would help to understand how much actual optionality there is here.

“Or does non-adoption mean they fall out of sync with the chain?”

nothing happens, all validators operating as normal.

i think it’s better to let the smallest/ unprofitable validators move to MetaPool Node Studio, give them a free ticket for at least 1 quarter, in this way, we don’t have to spend 150 NEAR/quarter, and also could reduce the management time and support effort from MetaPool

I believe that in the near term, based on examples like Solana, reducing inflation should eventually lead to an increase in the token price. However, it’s equally important that we maintain strong engagement and interest in the NEAR ecosystem to make this effect sustainable. Regarding the specifics of the support conditions, in my opinion, slimedrgn has explained everything quite thoroughly.

Hello,

This proposal was posted five days ago. After the seven day temperature check period, in about a day and a half, it’s eligible to become a canonical HSP proposal and to be put up for a vote.

As a next step, please submit it in markdown format as a PR to the proposals repository here: Sign in to GitHub · GitHub

Let me know if you have any other questions about the process.

Thanks!

Lane

Depend of the level of upgrade. Green this is ok to stay.
But other (Yellow, red) will kick you.

Btw, in the next version (probably in 2-3 weeks), this modification will be onboarded in a Yellow release

NEAR_MAXi:

Not through open debate.
Not through explicit, standalone consensus.

We have had open debate in August. I think every side expressed their opinion.

The vote that was run by Linear & HOT was a signaling vote with 90%+ of voted stake said YES.

So it’s time for real onchain upgrade vote. That is the current protocol upgrade process, that is the consensus (literally).

See: Upgradability - Guide to Nearcore Development

The feedback around small validators was heard - Metapool has was working on a few different options of the programs and proposed here a variant.

I think changing from bottom 100 validators to under X NEAR stake is a better approach.

For example for 100k NEAR, at lower 5% validator reward, these validators will be making less than 240N.

NEAR_MAXi:

• The emissions change was not voted on directly by the community in a clear, binding proposal.

What would this look like from your perspective?

Currently House of Stake has 180k NEAR - there is clear apathy to participate in the governance by the broader token holder base. House of Stake will need incentives and time to actually gain legitimacy. Adding incentives on top of existing staking rewards is just lighting up money on fire IMO.

Meanwhile, validators are currently representatives of the delegates of their stake. As we saw with signaling vote there were validators who were voting YES or NO based on the interests of the stake owners.

NEAR_MAXi:

• Unbundle monetary policy from protocol upgrades — permanently

We need a protocol upgrade for this and validators must adapt it But yes, that should be the plan as House of Stake actually gains large amount of stake and there is technical implementation for this.

NEAR_MAXi:

what happens to validators who don’t upgrade to the new version?

Please see the validator voting process / consensus (Upgradability - Guide to Nearcore Development). Effectively 80% of stake need to upgrade for protocol to change the version. When that happens, other validators must either upgrade or their client will stop running in the epoch with the new version.

Thanks for jumping in, Illia.

To be fair, I initially misunderstood — I thought the emissions cut was bundled with other protocol changes in a single release. But Bowen clarified (both here and elsewhere) that the only change in this release is the emissions reduction.

And if it doesn’t reach 80% validator adoption, emissions just stay the same.

That default outcome makes sense to me — no forced upgrade, just opt-in consensus. Appreciate the transparency.

if the majority accepted the inflation reduction version, then the proposal is implemented on mainnet with inflation reduced by half. The minority of validators will be forced to follow this to join the network; it’s the consensus.

Not apathy. HoS is not fit for purpose. I have over 18k NEAR in my validator. HoS UI doesn’t allow me to restake it into veNEAR. I was told there is an option from the cli where I could unstake my validator and through creating my own lock contract somehow stake it into veNEAR and then back to my validator. I’m not bothered, this is no apathy, this is too complicated.

Meta_Pool:

Milestone Target Date Deliverable Success Criteria Program Launch Q4 2025 Start Eligibility list published, monitoring active 100 validators identified

So where is the list? Does fox.pool.near qualify? I’m not sure. I’m validator no 292 out of 333. But I have 40k NEAR staked by MetaPool. Does it mean I receive MetaPool incentives or not?

Current method to get your tokens redelegate back to your validator is through CLI. The Agora team will add in a direct feature to redelegate in future versions (no set date yet). I attached the picture below for how to redirect the stake to your validator.

image1122×627 58 KB

I’m voting yes because I’m in favor of helping to maintain a diverse validator set if an inflation cut were adopted, but I don’t think ‘smallest validators’ is the right filter, and we’ll need stronger guardrails to avoid sybil abuse.

A short, one-quarter pilot with modest payments feels like a reasonable way to test this out. For a binding proposal, I’d want to see stricter uptime requirements and support amounts that better match actual validator costs.

I’ll be voting Abstain because I don’t feel 100% sure that I understand the full context for this proposal as someone relatively new to the ecosystem… but the proposal does not pass my smell test.

#1 I am skeptical of the approach of this proposal

We need to adjust the goals here. It seems like the goal is to just give extra rewards to small stakers that already exist, because we are about to cut the inflation rate and don’t want to lose them. This is not a winning strategy! To me it seems to be addressing a symptom and not solving a core issue.

IMO this program should be targeting the goal of attracting NEW, efficient and aligned validators to the network, such that our growth rate exceeds the drop off rate.

To do that we need an actual marketing budget attached to this. We need more competition in staking, there are people who would run these nodes if they had a good subsidy to get started…. but to find those people someone needs to be DMing on TG in other communities who run nodes, (not just posting on Twitter which they should do as well). Reach out to the DappNode and similar communities, and make it easy for people to get started.

We also probably need to have a big pot of Near that can be staked behind new nodes… maybe make it like a NEAR staking matching fund… where any NEAR that is staked by a new node will get 3 months of matching stake for every NEAR staked on their node… or some solution like that, so people can get new nodes up and get enough NEAR delegated so the validating can start.

I really don’t like the current approach of rewarding the people that have the least stake because…

#2 The incentives are backwards

The smaller you stake, the more you get (relatively). Everyone gets 150 NEAR regardless of stake size, so you’re literally incentivizing people to stake the MINIMUM. That makes no sense. You want competition. You want the best, most efficient setups. You want people with proper infrastructure who are bullish on Near and staking to their own node!

If we stick with this rewards system, instead of a flat payment, I would suggest a quadratic formula or something where it’s easy to align incentives. Maybe larger stakes get proportionally more, or base it on efficiency/performance. This proposal is telling people “stake less to get better rewards” and that’s the opposite of what you want. Imagine you are a Staker and have 150 people below you… there is currently an incentive to shed some delegation (maybe sell the NEAR you hold) so you can get down to be in the bottom 100. That’s dangerous.

We have a real opportunity here. This is a great chance to bring NEW validators to the network. Let’s go for big plays, not just subsidizing what we already have. Let’s use this budget to actually grow the validator set and make NEAR more decentralized.

#3 Uptime seems like the wrong metric?

slimedrgn:

Maintaining 97% uptime is too easy, that gives you more than 2 days of being fully offline every quarter. Even with 100% uptime (as calculated in this proposal), NEAR allows for 2-3 hours of downtime per epoch without losing validator seat or rewards, so it’s insanely easy to get 100% uptime.

Maybe instead of using the Uptime metric maybe we can use Endorsements % instead, that seems like a more competitive metric, which encapsulates Uptime alongside other metrics.

#4 But maybe I don’t know what I’m talking about

It is probably easier to keep our current nodes happy and here, than to attract new ones… and I appreciate that. We can design a solution to reward nodes via this program while we avoid incentivizing them to compete to be in the bottom 100. My first thoughts on how to do this might be a bit complex mathematically, but I’m sure we can create a simpler solution that is easy to communicate with a little more thought.

Can’t attract new validators when there is too little incentive. 5% was barely profitable, 2.5% is now for charitable purposes. But what do the Top 100 Block Producers care if all the “little people validators” are forced to shut down? Its just more Benjamins to them. A core problem here is NF thinks that running a validator should be a Staking as a Service business, not promoting decentralization. NF could do well to learn from Solana Foundation’s hugely successful delegation program instead of continuing to centralize/cartelize the Block Producers.

Griff:

Maybe instead of using the Uptime metric maybe we can use Endorsements % instead, that seems like a more competitive metric, which encapsulates Uptime alongside other metrics.

In endorsements a lot depends on random physical limits. Validators in Asia might average 90-95% while validator in EU / NA can get up to 99% endorsements with perfect condition. And it will be much more random with the planned upgrade to 200ms blocks, since it’s not easy to receive and endorse within 200ms if you’re located in a different country from chunk producer. I’m expecting 80-90% to be the norm then. And again, if someone knows how to manage 1 node perfectly, it’s very easy to manage 100 nodes. For reference, I’m currently managing 6 nodes and it takes me like 30 minutes a month of maintenance. I can easily run 60 nodes if I want to, all with near-perfect uptime and endorsement rate

Thanks for posting HSP-002. I’m broadly supportive of a time-boxed Q4 pilot that cushions smaller validators through the 5% → 2.5% inflation transition. To finalise, could you lock a few specifics:

– Snapshot: exact epoch/time and a provisional bottom-100 list for community verification.

– Uptime: source of truth + public methodology (and an appeals window).

– Exclusions: definition and initial roster to avoid ambiguity/double dipping.

– Anti-split: a lightweight policy for entity-linked validators.

– Transparency: publish payout txs + a Q4 report with Nakamoto coefficient and stake entropy.

With these, I think the pilot is well-scoped and measurable.

I will be voting in favour of HSP-002.

With the recent inflation reduction, we have received increasing feedback from smaller validators expressing concerns about sustainability. This proposal will help cushion the immediate impact and provide short-term support for these validators.

Additional recommendations to strengthen the outcome:

• Opening the validator support database:
  Open the list of smaller validators that require assistance, including key data such as stake size, commission, performance, and needs to other ecosystem partners. This enables them to incorporate these data in any initiatives or programs they plan to launch to help smaller validators.

• Ecosystem partnerships to boost staking:
  Explore collaboration with ecosystem partners such as Rhea, Legion, Sweat, and others to promote staking campaigns that funnel more delegations to under-supported validators.

• Adding an automatic staking feature for lock veNEAR:
  Once HoS introduces the delegation feature on the front end, users who lock NEAR but have no validator preference should be able to opt into an automatic delegation flow. The smart contract can then automatically re-delegate their NEAR to smaller validators in need of support, based on the Meta Pool maintained validator database.

• Long-term validator sustainability programs:
  Develop initiatives such as campaigns, competitions, or ecosystem contribution tasks where validator teams can actively promote NEAR, provide value, and in return gain more delegation. This will foster a value-for-value relationship rather than one-way support.

We vote FOR the proposal.

We support this proposal that aligns with our commitment to maintaining network decentralization and resilience. The proposal provides targeted, time-limited support to smaller validators who are most at risk from reduced rewards, helping to prevent centralization and validator attrition. The explicit focus on a single quarter allows for data collection and iterative improvement, and the requirement for high uptime incentivizes operational reliability.

The Decision version of this proposal passed a few days ago. I just updated the status of the canonical copy from Voting to Final: proposals/HSPs/hsp-002.md at main · houseofstake/proposals · GitHub

Hi everyone,

Here’s an update on the payouts and final steps for the first iteration of the Validator Support Program (HSP-002):

• We are currently identifying and verifying eligible reward recipients based on the Q4 snapshot and uptime criteria
• Payouts are scheduled for end of next week (Jan 23)
• We’re planning to host a community call to share the results, walk through key metrics (uptime, participation, decentralization signals), and discuss potential next steps for this program
• A written summary will follow the payouts and will inform whether a follow-on proposal is warranted. If you have questions or data points you’d like covered in the review, please drop them here.
• As a reminder, this payout concludes the Q4 pilot; any continuation would require a separate proposal.

We’ll continue posting updates in this channel.
Looking forward to rewarding validators for their important contributions to the network and to gathering feedback on how this pilot performed!

According to what was agreed under HSP-002, and with the support of the Gauntlet team, the payments to the 31 validators that successfully met the eligibility criteria have now been completed successfully.

To share the results and provide additional context, we invite the community to join an X Spaces session together with House of Stake (HoS), Meta Pool, and Gauntlet:

X Spaces: “Validator Support at NEAR – House of Stake”
January 29
2:30 PM UTC

The link to the X Spaces will be shared shortly.

Thanks to @Meta_Pool for sharing this update

To make the fund disbursement fully transparent, we’ve created a dashboard where you can:

• understand eligibility criteria
• review validator selection
• see recipient addresses

Let’s discuss the findings together on X Spaces: “Validator Support at NEAR – House of Stake”

X Spaces: “Validator Support at NEAR – House of Stake”
January 29
2:30 PM UTC
https://twitter.com/i/spaces/1yoKMPZaEakxQ

See you there!

Screenshot 2026-01-28 at 10.21.271646×1212 112 KB

HSP-002 Program Update

TLDR

HSP-002 rewards were distributed to 32 validators on January 23rd, 2026.

• 100% of rewarded validators remain active, while the number of small validators and their staked NEAR increased by 58% and 47% between the date HSP-002 was released to the forums and January 28th, 2026, respectively.

• The program was successful but the design is not sustainable

  • Snapshot based eligibility causes the set of qualifying validators to change materially over time, reducing predictability for participants.

  • Defining eligibility based on the 100 smallest validators does not materially affect stake weighted security thresholds.

  • Future programs should use adaptive, stake based eligibility thresholds that better align with network evolution and decentralization goals.

The list of HSP-002 eligible validators can be found here.

Background

In October 2025, a proposal was introduced to the House of Stake (HoS) to identify the 100 smallest validators by stake and award 150 NEAR to those among them that maintained at least 97% uptime between October 1st, 2025, and December 31st, 2025 (Q4 2025). This proposal was designed to offset infrastructure costs for small validators following the NEAR inflation reduction. The proposal was passed via HoS on November 13, 2025. Gauntlet was tasked with monitoring the program and providing economic analysis on its effectiveness to inform future program design.

Program Summary

Rewards for Q4 2025 were distributed on January 23rd, 2026. Payments were made to 32 validators, totalling 4,800 NEAR, based on eligibility criteria determined by MetaPool.

Following that criteria, the 32 eligible validators were determined as follows:

• Identify the 100 smallest validators as of October 1, 2025

• Filter the 100 smallest validators to those with at least 97% uptime

• Exclude validators that already receive incentives from other NEAR Foundation, Linear Protocol, or Meta Pool programs

Program effectiveness can be evaluated in various ways, for example, retention of existing validators rewarded, and small validator growth. The former indicates that there is a correlation between the rewards program and churn prevention. The latter indicates a correlation between rewards and net new growth. From that perspective, the program has performed well:

1. 100% Retention of existing validators: All 32 validators who received HSP-002 rewards remain active today (noting that 33 validators were eligible during the period, and one shut down operations before receiving any rewards).

2. 64 net new “small validators: Between the date HSP-002 was shared to the forums and January 28th, 2026, there has been a net increase of 64 small validators. The staked amount for small validators has increased to 3.9M.

However, further analysis reveals other methods for gauging success and identifying opportunities to improve the campaign design and its efficacy.

Insights

The success of HSP-002 is measured by its effect on validator behavior and network decentralization following the distribution of incentives. The program was designed to support the continued participation and performance of small validators after the NEAR inflation reduction, with the goal of maintaining network decentralization. Specifically, this analysis addresses four key questions:

1. Was HSP-002 effective at retaining small validators?

2. Did HSP-002 contribute to attracting new small validators?

3. Is the incentive program design sustainable going forward?

4. Did HSP-002 materially affect network-level stake decentralization?

Effect of HSP-002 on Validator Retention

To assess the effectiveness of HSP-002 on small validator retention, outcomes for validators who received rewards are compared with those of similarly sized validators who did not qualify due to uptime requirements. Validators participating in other incentive programs operated by the NEAR Foundation, Linear Protocol, or Meta Pool are excluded from both groups to isolate the effect of HSP-002.

All 32 accounts that received HSP-002 rewards remain active validators on the NEAR network. This group demonstrates a high rate of validator retention and sustained performance following the distribution of incentives. Of these accounts, 28 have continued to meet the required uptime threshold during Q1 2026 to date. The three accounts that are no longer meeting the uptime requirement are listed below:

In contrast, a subset of the 100 smallest validators did not qualify for HSP-002 rewards due to insufficient uptime. After excluding validators participating in other incentive programs, 29 validators remained in this ineligible cohort. Among these 29 validators, 9 are no longer active NEAR validators (31% churn rate).

Taken together, these outcomes suggest that HSP-002 has been effective in retaining small validators that already demonstrated high uptime.

Effect of HSP-002 on Attracting New Small Validators

HSP-002 was proposed on October 10th, 2025, while rewards were distributed based on a validator snapshot taken on October 1st, 2025. Consequently, any validators that joined after the proposal was published were not eligible for Q4 rewards by design.

Consequently, effectiveness in attracting new participants is assessed by examining changes in the population of small NEAR validators between October 10th, 2025, and the present. For this analysis, small validators are defined as those staking less than 150K NEAR. This amount represents the cutoff used to determine the 100 smallest validators in the October 1st, 2025 snapshot.

The underlying hypothesis is that HSP-002 contributed to the creation of these new validators, who are participating in the network with the expectation of future rewards targeted at small validator retention.

The table above shows that the number of new small validators increased between the release of HSP-002 to the forums and January 28th, 2026, as did the stake from small validators.

These outcomes suggest that HSP-002 has been effective in attracting new small validators, alongside other broader network dynamics.

Incentive Program Design Sustainability

As illustrated in the previous section, HSP-002 has helped attract new small validators. However, attracting these new validators has altered the underlying stake distribution of the 100 smallest validators. Of the 32 accounts that qualified for HSP-002 rewards as of October 1, 2025, only 15 would fall within the 100 smallest validators based on a January 1, 2026 snapshot.

The chart below illustrates the distribution of the 100 smallest validators at each snapshot, highlighting how the distribution of staked NEAR amongst the “smallest” validators has shifted over time.

image764×470 16.3 KB

The resulting shift in stake distribution also exposes a limitation of the snapshot-based eligibility design. While this approach effectively targeted small validators at inception, the program’s design becomes less sustainable over time as changes in the validator set and stake distribution shift the program’s definition of 100 smallest validators. In particular, validators that qualified as small in earlier snapshots may lose eligibility in later periods despite no material change in their own stake or performance. As new entrants shift the lower tail, rewards are effectively reallocated away from previously eligible validators, even though their infrastructure costs and NEAR stake remain largely unchanged. This dynamic introduces uncertainty for participants and raises concerns about the sustainability of HSP-002 as a long running incentive program.

Small Validators Impact on Decentralization

One objective of HSP-002 is to support small validators in order to preserve network decentralization. To evaluate whether small validators materially affect decentralization, this analysis examines their impact on stake-weighted control thresholds relevant to network security.

For each epoch, the minimum number of validators required to reach 33 percent and 66 percent of total stake is calculated, both with all validators included and with the smallest 100 validators excluded. These thresholds are commonly used to assess influence over consensus and network safety in proof-of-stake systems.

The chart below shows the number of validators required to control 33% and 66% of stake, with and without the smallest 100 validators, at each epoch. Across all epochs, excluding the smallest 100 validators has little to no effect on these thresholds. At the 33 percent threshold, the number of required validators is typically unchanged and occasionally reduced by one. At the 66 percent threshold, the difference is similarly limited to at most one validator, with many epochs showing no difference at all.

image1089×490 45.1 KB

These results indicate that, as with most major staking networks, NEAR’s stake-weighted security is primarily determined by a relatively small group of large-sized validators. While small validators increase overall participation and validator count, they do not collectively control enough stake to materially influence key control thresholds.

Programs designed to support small validators should be understood as long-term investments in decentralization rather than mechanisms for an immediate boost to network security. The short-term benefits of such programs include validator retention, ecosystem participation, and NEAR’s international brand adoption. The extent to which small validator growth should be prioritized is therefore a governance decision, recognizing this approach as investment-driven rather than a traditional ROI driven campaign.

Takeaways and Next Steps

HSP-002 results indicate that the program was effective at maintaining and growing small validators on NEAR.

• All 32 validators who received HSP-002 rewards continue to validate the network today. 91% of these validators have maintained the required uptime used in rewards eligibility through January 28th, 2026.

• The number of small validators and their corresponding stake has increased since the proposal was initially shared to the forums, despite the inflation reduction. The number of small validators has increased from 110 to 174 validators (58% increase). The associated stake for small validators has increased from 8.3M to 12.2M (47% increase).

• The total number of active validators increased from 296 on October 1st, 2025 to 396 at the end of Q4 2025. Validator location data is self reported and available for approximately 30% of active validators through the NEARBlocks API; within this reporting subset, no single country code accounts for more than 10 validators.

Fundamentally, and informed by other staking network designs, a program for growing validator spread should be considered for renewal. However, the current incentive design is not sustainable and should be revised to better align with evolving network conditions:

• Snapshot-based eligibility tied to the 100 smallest validators does not remain stable over time. On October 1, 2025, a validator could have up to ~150K NEAR and fall within the bottom 100. By January 1, 2026, that threshold had dropped to 69K NEAR.

  • Ongoing changes in the stake distribution cause the set of eligible validators to shift materially even when individual validator stake and performance remain unchanged, reducing predictability and long-term alignment with the program’s definition of “small.”

• The 100 smallest validators have a limited impact on stake-weighted network security. Across all epochs between October 1st 2025, and January 28th, 2026, excluding the smallest 100 validators, changes the number of validators required to reach 33% or 66% of total stake by at most one validator, with the thresholds remaining unchanged in the majority of epochs. The definition of “small” should therefore be calibrated to a group of validators that collectively controls sufficient stake to meaningfully influence these control thresholds.

Along with Metapool and the NEAR Foundation, Gauntlet will continue to investigate to inform the next program.

• Further discussions will be conducted to consider replacing the snapshot based eligibility model with a stake based threshold, with further analysis required to determine the appropriate cutoff.

  • Define a threshold that identifies validators which are individually small but collectively influence the 33rd and 66th percentile control boundaries.

Following review of the stated Proposal Outcomes for HSP-002, we confirm that the Validator Support Program has been successfully executed and is now considered complete.

Based on the reported results:

100 smallest validators received support to maintain operations in Q4 (32 of 100 were eligible)
No significant reduction in validator count or geographic diversity during the transition period
Stable network security metrics (uptime, participation rates)
Data collection and evaluation completed to inform follow-on proposals
Demonstrated that inflation reduction can coexist with strong decentralization

The deliverables outlined in the proposal have been met, and the program objectives achieved.
This thread will now be marked as complete. Any follow-on discussions regarding future validator support design should be initiated under a new proposal.

Thank you to @Meta_Pool, Linear, HOT, and @Gauntlet, as well as all validators and community stakeholders who contributed to the successful execution of this program and supported the network throughout this transition.