Network Incentive Allocation

The 35% allocation of the total token supply for network incentives is designed to sustain the ecosystem, drive participation, and ensure long-term network growth. Here’s how these tokens are utilized:

1. Staking Rewards:

   • Initial Year: The first year of staking rewards requires different amounts depending on the percentage of the initial supply that is staked. Below are the scenarios based on the 50% and 80% staking cases:

     • 50% of Initial Supply Staked:

       • First 6 months: 60% APR (33.75 million tokens)

       • Next 3 months: 30% APR (8.4375 million tokens)

       • Final 3 months: 15% APR (4.21875 million tokens)

       • Total for the First Year: Approximately 46.40625 million tokens required.

     • 80% of Initial Supply Staked (Worst-Case Scenario):

       • First 6 months: 60% APR (54 million tokens)

       • Next 3 months: 30% APR (13.5 million tokens)

       • Final 3 months: 15% APR (6.75 million tokens)

       • Total for the First Year: Approximately 74.25 million tokens required.

   • Subsequent Years:

     • 50% Staking Scenario: Approximately 11.25 million tokens per year will be required at 10% APR or less, ensuring continued incentives for stakers while conserving token supply for other purposes.

     • 80% Staking Scenario: Approximately 18 million tokens per year will be required at 10% APR or less. Even in this high-participation scenario, the system is designed to sustain long-term staking incentives.

2. Mining and Other Incentives:

   • Remaining Allocation: After the first year's staking rewards, the remaining tokens will vary depending on the staking scenario:

     • 50% Staking Case: Approximately 303.59375 million tokens are reserved for mining and other ecosystem incentives.

     • 80% Staking Case: Approximately 275.75 million tokens are reserved for mining and other ecosystem incentives.

   • Dynamic Allocation: This pool will support ongoing rewards for mining, task validation, and other activities essential for network stability and growth.

Strategies for Sustainability

1. Fee Implementation:

   • Transaction fees or fees for specific network activities (e.g., miner submissions, activations) will help recirculate tokens back into the incentives pool.

2. Dynamic APR Adjustments:

   • The APR will be adjusted based on network conditions to align the emission rate with the overall token supply and demand dynamics, ensuring sustainable rewards.

3. Incentive Redistribution:

   • Periodic reviews of incentive distribution will be conducted to optimize the effectiveness of network incentives, ensuring they support both staking and mining activities.

4. Community Governance:

   • Engage the community in governance decisions, ensuring that network incentives align with the long-term goals and sustainability of the Cortensor ecosystem.