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IOST Blockchain Explained Part 2: Network Participants

The blockchain industry offers numerous cryptocurrencies to stake, and all of them have different annual returns as well as staking rules. In the first part of this Blockchain Explained series, we have described in detail technological aspects of the IOST ecosystem, and in this material, you will find more information regarding the network participants that play key roles in the consensus mechanism.


As with any other network, nodes can play the role of validators that process transactions, keep the blockchain history, enforce correct data format both for transactions and blocks, prevent double-spending and others. Full Nodes in the IOST network are called Servi, and besides ordinary functions that they perform to keep the network secure, they must contribute to the network, so that they could continue producing blocks, validating transactions, so that they could get rewards. Contribution to the network can be different, starting from the complex development of particular network tools, ending with translations, community management, and others.

For these activities, Servi nodes get 25% in annual rewards from the ‘Block Production’ pool, and to become eligible for getting rewards a node must have at least 10 million votes. Also, Servi nodes must have stable performance and high uptime, so that it could provide smooth services to the network. If a node goes offline for 72 hours it will be removed by the network, and if it doesn’t update in 48 hours it gets removed as well. In case a Servi node goes below the vote threshold the network gives 7 days to reestablish the needed vote amount, and if it doesn’t cross above the vote threshold a Servi node gets removed from validating nodes and moves to Partner Nodes.


Individuals who participate in the voting process are called voters, and they support the self-governing mechanism. The voting right allows users to have some degree of control over the Node election process, which in the end helps to choose Partner Nodes organically making the network more decentralized. For voting activity, users get daily and quarterly rewards.


Validating nodes are divided into different Tiers by the network, and they receive rewards based on contributions they made during a certain period of time. It’s important to emphasize the fact that there are two types of rewards, daily and quarterly. Daily rewards for voters and validators are derived from inflation which accounts for 2% at the moment of writing this material. This inflation gets divided by two and then distributed among validators and voters.

Considering the fact that validators contribute differently to the network, rewards should be appropriate, depending on the contribution amount and quality. Hence, the network offers 5 Tiers where validators can get for their achievements. Every Tier receives quarterly rewards from the network, that also get distributed between voters and validators proportionally.

In case we talk about users who stake native cryptocurrency IOST, they will be receiving daily and quarterly rewards. Daily rewards are paid out from the current inflation level which accounts for 2%, which is divided by half and distributed to users and nodes.

Quarterly rewards depend on the voting length, or simply on the amount of time an individual kept their stake at a particular node. So the more time you hold your stake with one node, the higher the reward you will get. In the end, users can expect to have approximately 11.62% in annual returns.

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