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Today, we’ve got the Solana Foundation reining in its stake delegation, staking yields, and Helium’s AT&T partnership:

Solana Foundation begins pruning validators from delegation program

The Solana Foundation is tightening its leash on the validators receiving its stake. 

The Solana Foundation now says that for every new validator added to the Solana Foundation Delegation Program, it will remove three long-standing ones with under 1,000 SOL in external stake. The goal: have fewer validators relying on foundation stake and more earning authentic backing from the community.

Blockworks Research data lead Dan Smith estimated that at current staking levels, around 150 Solana validators would lose their foundation stake under the new rule. 

The Solana Foundation has a sizable stash of SOL tokens, and it stakes some of those tokens with smaller validators. Validators who go through KYC checks and enlist in the program also have some of their voting costs covered for a year. The program has booted participants before: In June 2024, it cut a group of validators found to have been operating private mempools, which can be used for sandwich attacks. 

This all may sound like inside baseball, but the delegation program is pretty central to Solana’s validator landscape. Last year, a report from Solana infrastructure shop Helius found 72% of validators receive foundation stake. 

Solana validators earn revenue partly through inflation, priority fees and MEV, which all scale as validators attract more delegated stake. In other words, finding lots of stake is the whole ballgame for validators. By booting validators from the delegation program, the Solana Foundation is forcing validators to either find new sources of stake or potentially go out of business.

The SFDP is a good program for bootstrapping a bigger validator set, but the Solana Foundation keeping some validators afloat obviously can’t last forever. It’s probably healthy for Solana to discourage freeloading.

Still, count this as one of a continuing string of woes for smaller Solana validators. First a drawdown in market activity, now this, then maybe a cut to Solana’s emissions rate down the road.

Jeffrey Albus contributed reporting.

— Jack Kubinec

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The yield isn’t yielding like it used to:

Solana’s nominal staking yield has declined for the past week, according to Blockworks Research. That’s partly due to a slowdown in network activity in recent weeks.

But the nominal yield lumps in dilutive SOL emissions, so the real APY — which subtracts inflation — is actually 2.77%.

— Jack Kubinec

Helium announced a partnership with AT&T this morning. 

The buzzy wireless-focused DePIN will now allow AT&T subscribers to connect to Helium’s decentralized network of wireless hotspots to “[expand] coverage and [enhance] mobile service,” according to a press statement.

That’s pretty vague language, but it sounds like Helium will offer a similar service to XNET’s recently-disclosed AT&T partnership for carrier offload, which was first reported in Lightspeed. Essentially, carriers ease congestion by offloading user data demands to DePINs where possible, and the carriers pay the DePINs for the coverage, which is then passed on to hotspot operators in the form of tokens.

Takeaway: Helium already has a carrier offload business, but AT&T is its biggest-name partnership yet. Working to enhance coverage for major telecom companies isn’t quite as sexy as building a brand new cellular network, but hey, businesses need to eat their veggies. Existing telco partnerships are easy wins that DePINs like Helium should absolutely be pursuing.

— Jack Kubinec

A message from Quynh Ho, head of venture investments at GSR: