How bounty distribution works

Many bounty programs use entries (= stakes) instead of setting a specific number of tokens for each and every task.

Why is that? And how does it really work?

Because bounty program managers don’t know in advance how many bounty hunters will join the program, they can’t allocate a specific number of tokens for each action item. So, bounty programs allocate tokens by entries/stakes instead.

What is a stake (entry)?

In business, a stake is the part of the business you own because you have invested money in it. For example: You hold 35% stake in a firm if you invested 35% of the money.

What does that have to do with bounty programs?

Well, also in bounties, a stake means the part you own — not in a business, but in the bounty token pool.

For example, if I have a 35% stake, I should get 35% of tokens in the bounty pool.

Crunching the numbers

A bounty pool is the number of tokens allocated to a specific program, like Facebook bounty or Twitter bounty. Let’s say for the sake of this explanation that the bounty manager decided to allocate 1000 tokens for the Facebook campaign; this becomes the bounty pool: 1000 tokens.

Now, for every comment I make I will get 10 stakes, and for every time I share, 20 stakes. During the bounty campaign I commented twice and shared 4 posts. In total, I have 100 stakes (20 for commenting and 80 for sharing).

Once the ICO/TGE is over, the bounty manager will calculate how many tokens my stakes are worth. In other words, what my part of the bounty pool is.

To know how many tokens each stake is worth, we need to apply the numbers to this equation: Number of tokens in the pool divided by the number of stakes in total.

If I was the only participant, then the total number of stakes is 100 (my stakes). And as we said, there are 1000 tokens in the pool. 1000 tokens divided into 100 stakes is 10. That means that every stake is worth 100 tokens.

Now, how do I know how many tokens I have?

Easy! All I need to do is to multiple my stakes in the number of tokens each steak is worth.

In our example, If I own 100 stakes and each of them worth 10 tokens, then I have 1000 tokens! Yay.

But what if another person joins the party and he also shared 5 posts? In that case he also gets 100 stakes.

So, now the total number of stakes is 200 (my 100 + his 100). Now, this will be our calculation: 1000 tokens in the pool divided by 200 stakes, which means each stake is worth 5 tokens.

Now how many tokens do I have? 100 stakes times 5 tokens = 500 tokens!

Lucky for you, you don’t need to do this math by yourselves.

That’s a job for the bounty program managers. All you need to do is participte and keep score on how many stakes you earned during the bounty. Usually, the bounty managers publish a public spreadsheet and update it every couple of days, so you will be able to track your stakes easily.

This article was written by the Emissary Guild team, to help and explain how bounty distribution works.

The Emissary Guild is a group of professional marketers, storytellers, crypto enthusiasts and crowdfunding junkies. Together, we are a marketing agency focused on helping companies build and execute marketing strategies, run bounty campaigns, manage communities and create crowdfunding tactics.

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