Rewards

Polygon has allocated 12% of its total supply of 10 billion tokens to fund the staking rewards. This is to ensure that the network is seeded well enough until transaction fees gain traction. These rewards are primarily meant to jump-start the network. While the protocol in the long run is intended to sustain itself on the basis of transaction fees.

Validator Rewards = Staking Rewards + Transaction Fees

This is allocated in a way to ensure gradual decoupling of staking rewards from being the dominant component of the validator rewards.

YearTarget Stake (30% of circulating supply)Reward Rate for 30% BondingReward Pool
First1,977,909,43120%312,917,369
Second2,556,580,02312%275,625,675
Third2,890,642,8559%246,933,140
Fourth2,951,934,0487%204,303,976
Fifth2,996,518,7495%148,615,670 + 11,604,170

Below is a sample snapshot of the expected annual rewards for the first 5 years considering staked supply ranging from 5% to 40% at 5% interval

% of circulating supply staked5%10%15%20%25%30%35%40%
Annual reward for year
First120%60%40%30%24%20%17.14%15%
Second72%36%24%18%14.4%12%10.29%9%
Third54%27%18%13.5%10.8%9%7.71%6.75%
Fourth42%21%14%10.5%8.4%7%6%5.25%
Fifth30%15%10%7.5%6%5%4.29%3.75%

See also Polygon reward calculator.

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