This referendum disables nominator slashing and reduces the unbonding period to 2 eras. It is intended to enact after the first staking configuration referendum, once the active validator set has had time to converge on full compliance with the minimum self-stake requirement.

The reasoning is straightforward: because validators are now required to maintain a minimum self-stake and bear the slashing risk on their own capital directly, the security rationale for keeping nominators slashable no longer holds. Validators have sufficient skin in the game to cover the security cost, so it makes sense to remove that risk from nominators entirely. This changes the nominator risk profile in a meaningful way, and since nominators are no longer exposed to slashing, the unbonding period can be safely reduced from 28 days to a maximum of two days.

Nothing changes for validators with respect to slashing. Slash deferral periods remain as-is.