The content and framing in this proposal are misleading and flawed for several reasons:
each validator is paid approximately 109 cUSD per day or $3,270 per month. Assuming 110 validators, that’s $359,700 per month.
Validators are paid exactly 2,500 cUSD per month (82 cUSD/day). The total monthly allocation is 275,000 cUSD. Your numbers are inflated by 30% and will mislead anyone unfamiliar with past governance discussions or tokenomics. Accuracy matters here.
many validators convert their cUSD into CELO and then sell CELO on CEXs like Binance and Coinbase
This claim is speculative at best. All conversions of cUSD to CELO are visible on-chain and movement to CEXs is traceable. No evidence is provided here.
In practice, most rational actors would use the cheapest and most liquid route - converting to USDT or USDC. Both are supported across nearly all major CEXs and offramp providers.
- A further data point: 2.5 months of validator rewards remain unclaimed since the L2 transition. That’s $703k not even touching the market.
It is also flawed to cherry-pick CELO’s absolute low at $0.25 (ATL $0.23) for your math, only for the price to 1.8x in three days to $0.45. That exaggerates your number by more than 2.3x. A neutral average (e.g. $0.30 over 90 days) is the sensible way to frame this.
The mechanics of validator rewards are misrepresented and hidden away in the footnotes. Validator payments are freshly minted cUSD daily, and the UnreleasedTreasury transfers a small amount of CELO (14% of rewards value in the last epoch) into the Mento reserve to collateralize the rewards. The real effect is on Mento reserve collateral ratio, not direct CELO sell pressure. The reserve today sits at a healthy 3.11x, hardly a sign of systemic risk.
To be blunt: this post reads like a low-effort hit-piece on validators. It makes big claims without evidence, relies on inflated math, and uses sensational statements like “putting direct sell pressure on CELO”.
That said, I do recognize where the frustration comes from. Some validators (now community RPC providers) have gone quiet: low visibility, little governance participation, minimal ecosystem contribution. From that angle, there is a legitimate concern that could be interpreted by some as leeching. But it’s equally important to recognize that other validators have been critical contributors since genesis - infrastructure, governance, tooling, ecosystem building e.t.c.
If the community’s concern is structural selling pressure, the most honest starting point would be Community Fund governance and improving accountability and transparency. Minipay (1 entity) alone received 6.5M CELO during the L2 transition, and Season 1 grantees (11 entities) collectively received 26M CELO. Compare that to validators: even if all of them claimed their monthly rewards today, the total would be 611k CELO; about 1% of this year’s Community Fund spend.
Finally, “55 validators” feels arbitrary and ignores validator group count and election mechanics. Any serious proposal should simulate what the validator set would look like after such a cut. If there is a strong, evidence-backed case for reducing validator rewards to rebalance tokenomics, I would gladly support it. But we need a discussion rooted in data, not hand-wavy math and speculation.
I’m especially interested in hearing from active validators on how they view this potential change.