How are Block Rewards allocated in First Treasury?
Block Rewards are governed by the Security Budget. This budget is the percentage of circulating token supply that the protocol will reward for security (staking).
It balances out utility v/s security for the STORE Cloud. First Governance sets the budget and protocol founders plan to grow the budget from 10% to 51% before governance ratification.
There are two types of rewards which make up the total reward pool of 20 million $STORE per year, these are;
- Mandatory Rewards which are fixed and paid out to miners for securing the network by performing transaction validation
- Discretionary Rewards which vary dynamically depending on the compute performance of each miner
This is the baseline reward structure whereby Storage and Validation miners are rewarded for securing the network and accounts for 70% of the total reward pool.
The remaining 30% is allocated as follows:
- 1.17% is allocated towards endowments to fund the day to day operation of each of the Miner, Security, Judicial & Executive branches
- 2.8% is allocated towards miners for providing a number of services to the network such as:
- 1.Storage capacity and uptime to the network
- 2.Upgrading hardware
- 3.Long-term staking
- 4.Voting in governance proposals
- 5.Lowering power usage efficiency
- 3.5% is paid instantly to Markets to incentivize good behaviour in the areas of governance and funding (all decisions are subject to a 2/3 vote)