cosmos-sdk/docs/spec/distribution/end_block.md

# End Block

At each endblock, the fees received are allocated to the proposer, community fund,
and global pool.  When the validator is the proposer of the round, that
validator (and their delegators) receives between 1% and 5% of fee rewards, the
reserve community tax is then charged, then the remainder is distributed
proportionally by voting power to all bonded validators independent of whether
they voted (social distribution). Note the social distribution is applied to
proposer validator in addition to the proposer reward. 

The amount of proposer reward is calculated from pre-commits Tendermint
messages in order to incentivize validators to wait and include additional
pre-commits in the block. All provision rewards are added to a provision reward
pool which validator holds individually
(`ValidatorDistribution.ProvisionsRewardPool`). 

```
func AllocateTokens(feesCollected sdk.Coins, feePool FeePool, proposer ValidatorDistribution, 
              sumPowerPrecommitValidators, totalBondedTokens, communityTax, 
              proposerCommissionRate sdk.Dec)

     feesCollectedDec = MakeDecCoins(feesCollected)
     proposerReward = feesCollectedDec * (0.01 + 0.04 
                       * sumPowerPrecommitValidators / totalBondedTokens)

     commission = proposerReward * proposerCommissionRate
     proposer.PoolCommission += commission 
     proposer.Pool += proposerReward - commission
     
     communityFunding = feesCollectedDec * communityTax
     feePool.CommunityFund += communityFunding
     
     poolReceived = feesCollectedDec - proposerReward - communityFunding
     feePool.Pool += poolReceived

     SetValidatorDistribution(proposer)
     SetFeePool(feePool)
```