Service Node Rewards

The WalletConnect Network implements a carefully structured reward system for node operators, designed to incentivize high performance and long-term commitment. The node rewards budget is split into two phases, with the first phase addressing the unique challenges of the WCT token non-transferability period.

Phase 1: Non-Transferability Period

During this initial phase, a fixed-base reward structure is implemented, resulting in the following token-base revenues:

1. Initial Allocation: 100,000 WCT are distributed as initial allocation and can be staked. These tokens are locked for the entire period of non-transferability.

2. Performance Boost (B_n): A boost given to nodes to reflect their performance and activity that is not based on WCT price.

Boost Calculation

The performance boost (B_n) is calculated as follows:

$B_n = \alpha + (weight \cdot performance score)$

A multiplicator (M_n) is also applied:

$M_n = \frac{100,000}{T}$

Where T is the period on which the initial allocation is locked.

Weight Distribution

The boost is based on the weight of the node relative to other nodes. Initially, if there are 15 nodes, each getting 100,000 WCT, they would each get 6.67% weight. This stake weight evolves if some nodes do not restake their boost.

Performance-Based Rewards

Individual node rewards are conditional on the performance factor $U(i,t) \in [0, 1]$. In line with the performance factors for other groups, there is a set of KPIs defining this. Initially, it will be based on uptime and latency.

For a detailed explanation of how these factors are calculated and weighted, please refer to the Performance Evaluation section.

note

The reward structure is subject to adjustment through network governance to ensure it continues to align with the network's goals and economic sustainability.