65 lines
3.3 KiB
Markdown
65 lines
3.3 KiB
Markdown
# Distribution
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## Overview
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This _simple_ distribution mechanism describes a functional way to passively
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distribute rewards between validator and delegators. Note that this mechanism does
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not distribute funds in as precisely as active reward distribution and will therefor
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be upgraded in the future.
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The mechanism operates as follows. Collected rewards are pooled globally and
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divided out passively to validators and delegators. Each validator has the
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opportunity to charge commission to the delegators on the rewards collected on
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behalf of the delegators by the validators. Fees are paid directly into a
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global reward pool, and validator proposer-reward pool. Due to the nature of
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passive accounting whenever changes to parameters which affect the rate of reward
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distribution occurs, withdrawal of rewards must also occur when:
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- withdrawing one must withdrawal the maximum amount they are entitled
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too, leaving nothing in the pool,
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- bonding, unbonding, or re-delegating tokens to an existing account a
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full withdrawal of the rewards must occur (as the rules for lazy accounting
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change),
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- a validator chooses to change the commission on rewards, all accumulated
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commission rewards must be simultaneously withdrawn.
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The above scenarios are covered in `triggers.md`.
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The distribution mechanism outlines herein is used to lazily distribute the
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following rewards between validators and associated delegators:
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- multi-token fees to be socially distributed,
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- proposer reward pool,
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- inflated atom provisions, and
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- validator commission on all rewards earned by their delegators stake
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Fees are pooled within a global pool, as well as validator specific
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proposer-reward pools. The mechanisms used allow for validators and delegators
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to independently and lazily withdrawn their rewards.
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Within this spec
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As a part of the lazy computations, each validator and delegator holds an
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accumulation term which is used to estimate what their approximate fair portion
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of tokens held in the global pool is owed to them. This approximation of owed
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rewards would be equivalent to the active distribution under the situation that
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there was a constant flow of incoming reward tokens every block. Because this
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is not the case, the approximation of owed rewards will deviate from the active
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distribution based on fluctuations of incoming reward tokens as well as timing
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of reward withdrawal by other delegators and validators from the reward pool.
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## Affect on Staking
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Charging commission on Atom provisions while also allowing for Atom-provisions
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to be auto-bonded (distributed directly to the validators bonded stake) is
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problematic within DPoS. Fundamentally these two mechnisms are mutually
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exclusive. If there are atoms commissions and auto-bonding Atoms, the portion
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of Atoms the reward distribution calculation would become very large as the Atom
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portion for each delegator would change each block making a withdrawal of rewards
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for a delegator require a calculation for every single block since the last
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withdrawal. In conclusion we can only have atom commission and unbonded atoms
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provisions, or bonded atom provisions with no Atom commission, and we elect to
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implement the former. Stakeholders wishing to rebond their provisions may elect
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to set up a script to periodically withdraw and rebond rewards.
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