Bitsong; Validator/Delegator Revenue
Participants who are Revenue Validators or Delegators are rewarded for their participation. Two types of revenue are used to pay for rewards:
Block bonuses:
The inflation algorithm generates block rewards, coining new BTSG with each block. The algorithm is set up to encourage holders of BTSGs to stake. The percentage of bonded BTSG that is present determines BTSG inflation. The rate of inflation will decrease if the proportion of bonded BTSG in the total supply rises. The percentage of bonded BTSG and the inflation rate both have an impact on the reward percentage. Simply put, the formula is constructed in such a way that, in the event that the number of bonded BTSG decreases, participants will be able to receive greater rewards as a result of the inflation parameter increasing the number of newly minted BTSG. More bonded BTSG will be attracted to the network as a result of the increased rewards. You can see the expansion rate and level of reinforced BTSG progressively utilizing the BitSong Explorer.
Fees for transactions:
On the BitSong network, fees are paid in BTSG for each transaction. These fees are distributed to Validators and Delegators based on the weight of their stakes.
Validator Commission:
Each Validator gets income paid to their Validator pool in view of their all out marked sum. Before the income is dispersed to the Delegators in the pool, the Validator can apply a commission. Let’s take an illustration.
A Validator has a stake pool equal to 10% of the stakes held by all Validators. Additionally, this Validator applies a 10% commission rate and has a self-delegated stake of 20%.
A block comes in with the following revenue:
- 990 BTSG in block provisions
- 10 BTSG in transaction fees.
So a total of 1000 BTSG to be distributed among all staking pools.
Their Validator’s staking pool represents 10% of the total stake, which means the pool receives 100 BTSG. Now let’s look at how the revenue breaks down to Delegators:
- Commission = 10% * 80% * 100 BTSG = 8 BTSG
- Validator’s revenue = 20% * 100 BTSG + Commission = 28 BTSG
- Delegators’ total revenue = 80% * 100 BTSG — Commission = 72 BTSG
Now, each Delegator in the staking pool can claim their portion of the Delegators’ total revenue.
Risks
Staking cryptocurrencies carries some risks. Your BTSG are locked up while they are staked, and you have 21 days to unbond them before you can release them.
In addition, there is a possibility that Validators will behave improperly and face severe penalties. The stake of their Delegators is included in any slashing.
Double-signing is the primary act that results in severe penalties. This validator will be slashed if someone reports that it signed two distinct blocks with the same chain ID at the same height.
The performance of a Validator, as well as their history of slashing, will be shown by their track record. Delegators must, as a result, thoroughly investigate Validators prior to delegating. It’s also important to keep an eye on performance. You can simply switch to a different Validator if your chosen Validator is frequently unavailable. You also have the option of betting on multiple Validators to mitigate the overall risk.
About Bitsong
BitSong is a multifunctional blockchain-based ecosystem built to empower the music industry. It unites artists, fans, distributors in an environment where music, merchandise, and fan loyalty are assets of value. BitSong’s decentralized ecosystem of services providers the global music community with a trustless marketplace for music streaming, Fan Tokens, and NFTs, powered by the BTSG token.
Contact BitSong Official;
Website | Sinfonia | FanToken | NFT | Github | Mainnet | $BTSG on Osmosis | Discord | Telegram |
