Incentives for participating in $ATLA staking.

Staking Rewards

Rewards for staking $ATLA into the protocol provides additional $ATLA yield to the stakers that is accrued from two sources; consensus rewards and transactions fees.

Consensus Rewards

Consensus rewards are emissions of newly minted $ATLA coins that are unlocked on a block-by-block basis and distributed simultaneously to validators and nominators pro-rata at the end of an epoch.

Due to ATLETA's fixed/deflationary monetary policy, consensus rewards are available for extraction for a total of 63,100,800 blocks (72 months / 6 years) after the launch of ATLETA mainnet. Once the last block containing consensus rewards has been minted, the network will transition into a reward model that is purely based on transaction fees.

Consensus Rewards Calculations

Given that there is a different set of validators every 36 hours, within which there are 6 changes in the obligation set, the model for distributing consensus rewards has been kept maximally simple in order to maintain alignment with NPoS's election mechanism.

  1. The total reward of the epoch is calculated (emissions per block * # of blocks).

  2. The contributions of each validator are accounted for via a point system (validator * work).

  3. The individual contributions are balanced against the total contributions based on stake weight (validator * work / all work => validator stake).

By constantly adjusting the validator set, reward accrual becomes more evenly distributed. Had there always been a single validator set, then in the event of there being a single actor with even a minute surplus of stake over all other, that single validator would over time accrue a disproportionate amount of the emissions. Moreover, the deterministic property of even distribution creates a knock-on effect that incentivizes diversification during the nomination/selection process; by incentivizing the election of lower-ranked (by stake weight) validators and disincentivizing overconcentration at the higher-ranked end of the network, ATLETA becomes capable of distributing staked capital (consensus power) more equally and efficiently, in turn, increasing the resilience against subversion (Nakamoto Coefficient).

Per Block $ATLA Emissions: ~24.112 Per Minute $ATLA Emissions: ~482.25 Per Hour $ATLA Emissions: ~28,935.18 Per Day $ATLA Emissions: ~694,444.43 Per Month $ATLA Emissions: ~20,833,333.33 Per Year $ATLA Emissions: 250,000,000 Total $ATLA Emissions: 1,500,000,000

Transaction Fees

Transaction fees on ATLETA are composed of two separate parts; base fees and a tip.

Initially, in the early stages of ATLETA's operations, the entire fee will be distributed throughout validators. However, as the chain's velocity increases and economic policy matures, there will be an adjustment to the fee structure to resemble EIP-1559; where base fees will be burned and only the tips become a form of revenue for validators/stakers.

By the time consensus rewards subside we anticipate the velocity of network activity to scale order of magnitude beyond their initial phase and supplement a substantial portion of the consensus rewards.

Assuming every 36 hours 10,000,000 transactions take place (that is ~78 TPS) and the average transaction tip is $0.03, then each validator set will earn $300,000 per epoch. Further assuming that the validators accrue 50% of their placements through nominator votes and share 90% of the earnings; then validators will be able to earn $165,000 per epoch and nominators will earn $135,000.

Reward Allocation

Whenever consensus rewards are distributed, they must be allocated to both validators and nominators. Given that validators are the defacto actors actually earning the emissions, ATLETA has implemented modules to ensure prompt and accurate reward diffusion through the supply chain.

Whenever a validator enters the candidate pool, they will have to configure their reward shares (how much they will distribute back to nominators). There have not been any limits set on this, entirely left up to the validators preferences, we anticipate free market forces will take prevalence and ultimately align validator behavior through competition.

Whenever a nominator is electing their validator set, they will see the reward share proposed by each validator; and assuming that the market participants are rational actors, they will always chose those with the most favorable reward sharing terms.

scenario:* this has been maximally simplified to illustrate the principle itself. Validator A has 1,000,000 $ATLA staked. He earns 50,000 $ATLA per month. If he doubles his $ATLA stake, he will earn double the monthly emissions. Buying 1,000,000 more $ATLA will cost him $500,000. However, having nominators allocate their portions will cost him nothing. Given that there is no extra cost from attracting nominators, Validator A can offer 90% share of earnings. Nominators see his reward share, and allocate 1,000,000 $ATLA to him. Next month, Validator A extracts 100,000 $ATLA; 50,000 from his own stake and 50,000 from the nominators. He will distribute 45,000 to his nominators and keep 5,000 for himself. Here, everybody wins. The validator was able to keep his operational costs fixed, while increasing earnings, and the nominators found a reliable actor that shares enough of the reward percentage to keep them satisfied.

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