Node economics

Reward formula

Base reward 0.0001 PCP per call is fixed in 0.1.0. The two multipliers scale output; operator_share is 0.20 (20% to the operator, 80% flows to delegators pro-rata).

Stake tier table

Tier	Stake range (PCP)	Multiplier	Extras
T1	10,000 – 99,999	1.0x	Baseline. Any serious home operator.
T2	100,000 – 999,999	1.3x	Typical $5 VPS operator after accumulating.
T3	1,000,000 – 9,999,999	1.6x	Serious pro operator, paid upstream RPCs.
T4	10,000,000+	2.0x	Priority routing: coordinator sends traffic to T4 first when healthy.

Stake floor to operate at all: 10,000 PCP (~$500 at $0.05/PCP).

Why location matters

Every L4 call is a race. The coordinator hands a request to the closest healthy node, and the network also runs parallel-of-5 races for high-value traffic — first response wins. Latency decides. A Raspberry Pi in Brooklyn serving users in Manhattan beats AWS us-east-1 at full load, because one hop inside a borough is < 5 ms and a trip to Ashburn is ~50 ms. The reward curve below makes that real: the fastest responder earns the most.

Latency multiplier

p50 serve latency	Multiplier	Who typically hits it
< 10 ms	2.5x	Same-LAN/ISP nodes. Home Pi, phone, NAS, router serving local users.
< 25 ms	2.0x	Same-metro nodes. Desktop in your city's fiber range.
< 50 ms	1.5x	Same-region nodes. Home server or small VPS.
< 100 ms	1.0x	Baseline — cross-country / neighbouring region.
< 250 ms	0.7x	Cross-continent. Soft penalty.
≥ 250 ms	0.4x	Bad placement or overloaded. Hard penalty.

Residential bonus

When a node with hw_class of pi, phone, console, nas, or router wins a latency race, it earns +20% on top of its reward. We want Joe Schmoe's Pi in the basement to beat AWS us-east-1 — not because we subsidize it, but because it's actually closer to real users.

Density penalty

If more than 5 nodes crowd into the same ~20 km geohash-4 cell, the rewards pool splits among them — mult = 5 / count. Prevents "stack 50 VPSes in Ashburn" from winning. Forces geographic distribution.

Full L4 reward formula

Race winners also earn a 2x region leader multiplier on /api/node/leaderboard/latency. Live coverage + PCP earnings visible at /node-coverage.html.

Uptime multiplier

30-day uptime	Multiplier	Note
≥ 99.5%	1.2x	Bonus — rare air, routed more calls.
≥ 99.0%	1.0x	Target. Standard multiplier.
95.0% – 98.9%	0.7x	Soft penalty.
< 95.0%	0.5x	Hard penalty. Also risks downtime slash if any single incident > 1 hr.

Slashing

Offense	Penalty	Detection
Verified dishonest answer	1% of self-stake burned	1% receipt sampling re-run against canonical source.
Downtime incident > 1 hour	10% burned	Coordinator heartbeat timeout.
Provable fraud (double-sign, key theft, sybil)	100% burned + ban	On-chain challenge via NodeRegistry.challengeReceipt().

Only operator self-stake is slashable. Delegator stake is never directly burned — but a slashed operator earns less going forward, so delegator yield drops until they re-delegate elsewhere. Unbond period: 14 days.

Delegation

100M PCP, 4-year emission curve

100,000,000 PCP is set aside from the 30% Community & Builders allocation, distributed linearly to node operators over 48 months based on proof-of-served calls.

vs Pokt Network — the stack advantage

Taxes