SPOt-light #009 [ADAOZ]

From the country of kangaroos, scorpions and Finding Nemo, we bring you the 9th edition of ‘SPOt-light’ featuring @Cardanodeau, Part owner and operator of ADAOZ pool, and host of the “Learn Cardano Podcast” with whom I’ve had the pleasure to sit down! This time, it his turn in the limelight. I have inside info but this one is a fantastic read and worth every minute spent reading it, Enjoy!

  1. Hello Peter, tell us a little bit about yourself, what are your areas of expertise? (Tech, finance, other), how did you learn about Cardano and what led you to adopt the role you currently play in the ecosystem?

I’ve been working in the web industry since 2005 building websites under my own company and for various Government or media agencies. Primarily the last 10 years have been working on my own business designing and developing websites and applications with my team using WordPress and Joomla.

I discovered Cardano from a WordPress meetup organiser when the white paper was released for the ICO back in 2017 but I didn’t really get interested in the project until I found out that I could actually run a stake pool in early 2021.

  1. So some people may have noticed that you run a podcast called “Learn Cardano” and maybe they have even seen the episode where we talk about various topics. (if not, link “here”) Tell us about that podcast and share your weirdest experience.

I started the Learn Cardano Podcast shortly after starting the pool. I was intending to start up my old podcast again, the Joomla Beat Podcast, all about the content management system Joomla, but Cardano was way more interesting and something I was a lot more passionate about. 

In terms of anything weird? Nothing that I can report. I haven’t received any dick pics or marriage proposals yet but will report when I do. There is a large amount of scams which everyone should be aware of.

  1. What is the current state of your Pool, how is it set up and are there any developments in the near future? If its a Bare metal server, include a picture if you like, we’re curious how you roll!

The stake pool is set up with 4 relays and the block producer. 3 relays in the cloud spread across multiple different cloud providers and the 4th relay is a Raspberry Pi which acts as a backup relay.

The way we have set up the configuration of the stake pool is cloud agnostic. We use a combination of tools from Ansible, Terraform, Puppet and other CI deployment services and techniques to help automate set up, updates and other aspects of our pool. 

It doesn’t matter what provider we’re on, we can fire up instances from the command line and have a new relay or block producer ready within a short period of time. It reduces downtime and allows us to switch from provider to provider as necessary. The Raspberry Pi part of the set up is manual unfortunately, maybe we’ll have to cut it out.

  1. Were there any problems, obstacles to overcome on the way, and if yes, how did you tackle them, what resources did you use?

When I registered my pool, there was another pool that registered 8 hours after mine with the same ticker ADAAU. I have a feeling that they are no longer operating now but didn’t deregister their pool, which means they may still have the 500 ADA locked into their account that was used on registration still in limbo. I registered ADAOZ 10 days after deregistering mine and starting all over again.

Another mistake I made when initially starting was that I exposed my block producer node to the entire network by using the same topology.json file as my relay was using. This meant that I was fully connecting it to many many other peers on the network. Once I realised I shut down that server and started a fresh new one and restored the pool on the new block producer server.

I also set up my relays behind load balancers on AWS. AWS EC2 instances get new IP addresses assigned to them each time an instance goes through a hard reboot. It seemed like a good idea as it allowed for subdomains to be allocated to an EC2 instance which was locked behind a load balancer and firewalls. It ensured that only stake pool related traffic could get through, the IP address of the relays were never exposed and solved the issue with the auto changing IP addresses on hard reboots. What I didn’t account for was the extra cost in bandwidth. My bill for the relay bandwidth for a month was close to $600USD. I highly recommend not using a load balancer.

The Raspberry Pi was also interesting to set up. All of the ARM related compilers were a little harder to set up and get working. I eventually just went for Alessandro Conrads setup on GitHub which made things a lot easier. Other issues such as dynamic IP changes on my home connection and drop out of the network due to high and continuous bandwidth usage made it quite hard to manage. I don’t recommend it as an option if you don’t have the time to tend to it. There are some amazing Pi pools setups and they’re quite an inspiration to see up and running. I also recommend a silent heat sink case as the high pitch fan in mine gives me a headache.

One of my relays on AWS was suffering from over resource usage and DDoS attacks. After talking to fellow Australia stake pool operator, Casey Gibson from AOAUS, he pointed out that there were better hosting options compared to AWS. Which I investigated and completely moved everything over to. It was a good exercise in pool benchmarking performance and cloud infrastructure migration.

I also help manage and operator other pools and some of the issues that I’ve stumbled across have been interesting. Everything from folder permissions changing across the server stopping the node from syncing with the blockchain, to corrupt DBs and being locked out of encrypted wallets.

All excellent learning lessons that have equipment for more complex pool ops.

  1. So, the F2LB Initiative, it’s fairly new, can you tell us a little bit about it, what is its purpose and what can people do to help?

First to Lifetime Block (F2LB) was an initiative started by Stefano [STPZ1] to help pools get their first block minted. A group of stake pool operators and delegates combine their ADA into a massive moving delegation that moves from pool to pool each epoch based on a few rules that have been setup by the group. 

You may have some pledge, a good server setup and an eager team to help promote the pool, but it’s hard to trust the pool when they haven’t minted a block yet. It’s the old problem of what comes first, the chicken or the egg. If you can get the pooled delegation that F2LB provides to show that your pool can mint blocks then you can finally attract other delegates to your pool rather than telling them to join you in blind faith that you will eventually get there.

I joined the F2LB initiative pretty much when it all started but I didn’t use Discord so I missed a few of the updates and was dropped in the queue. It might have worked out for the best as the community behind it has grown and the amount of ADA that is moving from pool to pool is now over 1M ADA which is enough to get a pool up and minting blocks if everything is set up correctly.

  1. As a recent beneficiary of the Cardano Foundation your pool made a nice boost in production pace! Congratulations from all of your F2LB buddies. How will this impact your future plans?

The IOG delegation to the pool is a nice boost giving it an extra 3.2M ADA. Our approach was to never rely on it and make sure that we got to 1.5M ADA to be able to mint a block every epoch and prove that we could run a successful pool. The delegation took us from 5.4M ADA to 8.6M ADA.

Before the delegation, our goal was to simply gain an extra 100,000 ADA per month until we started minting blocks. We were lucky enough to mint our first and second block at the 230,000 ADA mark. From there the marketing efforts would keep pushing until we started gaining 1M ADA per month until the saturation point.

We’re now at 8.8M ADA and we’re aiming to gain the equivalent 3.2M ADA that IOG has delegated to us over the next few months to fill the gap once it leaves, roughly 250k ADA a week.

  1. What can people do when they don’t operate a pool, but do have some ADA in their portfolios, can you give some general recommendations? Do’s and don’ts so to speak.

If you’re not actively trading your ADA multiple times a day then stake your ADA. You might as well ensure that you’re earning rewards/interest on your ADA while you’re not trading.

If you’re day trading, ensure that you know how to move your ADA in and out of an exchange to perform your trades easily. A good tip is to ensure that your ADA is in your staked wallet before the end of an Epoch when a snapshot is taken for the pool that you’re delegating in. It ensures that your stake is taken into account for the next epoch.

  1. We see a lot of Big Pool operators successfully managing multiple pools. It seems like a good idea from where most people stand. Exchanges do roughly the same thing. How do you feel about this and how does it, in your view, affect the purpose of Cardano?

There are some multipools clusters that do this in a good and productive way and others that you can who are clearly just gaming the system for the 340 ADA rewards.

If a person is operating a pool and it is close to a high saturation level, e.g 80% it is worth it for them to spin up a new pool with the same ticker to spread the delegation to both or more of their pools. This will ensure that they don’t become oversaturated and continue to grow their pool’s brand.

On the other hand, I’ve seen pools with very low saturation, e.g 2M, just enough to mint blocks every epoch, and spin up multiple pools with the same amount of low pledge and delegation which ensures that they mint the min 340 ADA fee. I see this as fixed fee farming and doesn’t benefit anyone.

The last cluster are the exchanges. These are the largest of the multipool clusters and in a way, they’re offering what their customers are after. A way to hold on to their ADA in a convenient way. What these delegators may not realise is that the solution is completely centralised and not in their control. If the exchange comes under Government regulation or there is high demand on the servers of the exchange, it’s highly likely that you won’t be able to access your ADA.

The last major market correction that was thanks to Elon Musk, I had ADA on an exchange that I wanted to sell at the high and buy back at the low. I couldn’t log into my account let alone trade anything that was on it. Decentralised exchanges on Cardano are going to be a really cool feature when the time comes.

  1. Why should people delegate their ADA to your pool, or what benefit do they get from supporting this initiative?

Our pool ADAOZ produces content for beginners in the Cardano community. We’ve started a podcast, a YouTube channel, in person Meetup events around Australia  and a blog all dedicated to all aspects of Cardano. Supporting our pool supports the production of the content for the community.

If you want to learn more and love good high quality content to be produced for Cardano, then that is why you should support ADAOZ and the Learn Cardano Podcast.

  1. Any final thoughts?

If you’re thinking about starting a pool, consider these thoughts.

Being a stake pool operator and starting a pool at this point in time is a multi-skilled job. You have to be proficient at Linux and comfortable with building a server and running command lines to build the Cardano stake pool. You’ll need to be an expert communicator and online marketer to get the word out about your pool. You’ll need money and time to be able to get the pool up and running. Consider a budget for operating costs and your time and effort for the pool.

Ensure that you have at least 25,000 ADA for the pledge and 500 ADA for the registration of the pool. This will ensure that you have enough ADA to meet one of the minimum requirements of the Cardano Foundation’s delegation strategy. 

Your pool needs a point of difference compared to all the other pools. Whether it is a charity or about creating content, ensure that it is something that will get people’s attention.

Marketing and building awareness of your pool is a full time job in itself. Be prepared to essentially work full time on it with no reward for 6 months to a year. Reassess every month and see if your pool and following is growing or not and change strategy if you need to.

Be open to being a multi owner pool and bring in others that are willing to help. Record and set small achievable goals, celebrate the goals, and set more goals. Look back at these in a few months.

The Cardano community is a wonderful place to be with so many helpful members and enthusiasts. Share your experiences and help others. Advice and help will come back to you when you need it as well.

Pete, Thank you so much for your inights, the way you present your point is concise and clear, its been an absolute pleasure reading and aditing this, and putting up with the brilliant timedifference between Holland and Australia 😉 We wish you the best of luck in the coming months and well be sure to keep an eye out for the Podcasts.

Cheers, Bas

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