Slashing and Economic Security
Slashing is the primary economic defense mechanism that aligns node operator incentives with the security of the network.
What is Slashing?
THORChain uses two related penalty ideas that should not be collapsed together:
- Slash points reduce earned rewards for reliability failures such as missed observations, missed signing participation, or keygen failures.
- Bond slashing burns bonded RUNE for security-critical behavior such as unauthorized outflows or theft.
Bonded RUNE is the "skin in the game" that makes attacks economically irrational, but not every operator fault directly confiscates bond.
Types of Slashing Events
- Reward slash points: Missed observations, missed signing participation, failed keygen, or other reliability failures that reduce rewards.
- Bond slashing: Unauthorized outbound transactions, theft, or other security-critical vault behavior.
- Consensus faults: Double signing or equivocation can put bond at risk according to current protocol rules.
Slash Rate
Slash constants and minimum bond values can be overridden by live Mimir parameters. The wiki should describe the economic purpose of slashing, then point to THORNode constants and Mimir for current values rather than freezing a rate in prose.
Churn and Unbonding
Nodes that accumulate too many slash points can be forced out of the active set during churn. Unbonding and leaving are state-dependent: active nodes must churn out first, standby nodes can unbond, and operators should verify node state before assuming bond is withdrawable.
Why This Matters
Without strong slashing, a rational actor could attempt to steal funds or disrupt the network if the expected value of the attack exceeded the bond at risk. Bond ranges, minimum bond, and slash multipliers are live/current-only parameters and should be checked before being quoted.
The system has been tested through multiple real-world incidents and has continued to evolve its monitoring and response mechanisms.