Polkadot's current design allows validators to change the commission they receive for their work, affecting the rewards nominators might receive for backing them up. The changes are virtually instant and without prior notice to nominators. Although this can help for nominators to be alert on the changes in their set, it is considered by many as not ideal.
Below, a brief summary of an ongoing discussion on this and some possible solutions presented by the Parity team and external contributors to regulate changes on commissions:
Two main solutions come to mind when discussing the topic:
**1. Implement a MaxComissionChange parameter, which is a configuration a validator will set as the max amount of commission they will be able to increase or decrease per era. **
MaxCommissiomChange is a preference the Validator would set for themselves, such that they cannot change their commission + or - more than that amount per era. So if a validator says their value is 10% and their commission is currently 5%, trying to set a 20% commission the next era will fail: This would have no effect on Nominators and removing nominations.
2. add a RemoveNominationOnComissionChange parameter for a nominator, where they would specify if they would remove a nomination if the validator changes their commission (perhaps by some threshold).
Both can help prevent Validators from pulling the rug from nominators, but demand storing more state on-chain. While the first protects validators, the second one seems to reinforce the idea that there is a type of contract between the parties to take care of.
3. A third opinion was to invalidate all nominations on commissions' change, following the rationale that changing the conditions of a tacit agreement should follow the cancellation of the agreement in question.
Although a very effective solution to protect nominators' rewards, this option can turn problematic for validators' setup, given it is expected for validators to create and develop a community around them. Furthermore, if a validator lowers its commission to become more attractive to nominators, this would not be beneficial in the end for both parties, as nominators would stop backing up the validator and the validator would lose support, even by benefiting nominators.
4. Regarding off-chain solutions: an alternative is to build a server to monitor the commission change, and send an email to subscribers if it increases. Seems like an idea that the Polkadot treasury can support. This solution, although practical is deemed not very privacy friendly. A possible solution for it would be to use Ryabina's telegram bot as a way to notify the parties.
There is an open issue about the topic to review here.
Feel free to add your comments on this post as well.