Overview
Subsquid operates as a decentralized network designed to scale data access while maintaining reliability, security, and decentralization. The network employs a flexible rewards system that adapts based on usage rather than fixed rates. For instance, the base APR can increase up to 70% in a situation where more worker nodes are required.
Reward Sources
The initial rewards come from a dedicated pool representing 10% of the total token supply allocated for the first three years of network bootstrapping. This structure ensures 90% of capital disperses within the three-year period.
Factors Influencing Reward Rates
Rewards depend on two primary variables:
- Network utilization (target capacity minus actual capacity, divided by target capacity)
- Total staked SQD (delegated or bonded tokens)
The target APR considers the utilization rate and the APR cap — the maximum possible return based on staked amounts. Subsquid projects equilibrium base APR around 20%, calculated daily as (annual rate / 365).
Reward Distribution
Workers
Workers operate nodes, process traffic, and receive stakes from delegators. Their rewards factor in:
- Stake contribution: S[i] / sum(S[i])
- Compute contribution: Measured via Traffic Units using the formula T[i] = sqrt(t_scanned[i] * t_e[i])
Worker payouts include liveness and tenure discount factors. The formula provides: r[i] * b[i] + 0.5 * r[i] * s[i]
At equilibrium, workers project 20-30% annual returns.
Delegators
Delegators receive: 0.5 * r[i] * s[i]
Projected equilibrium returns reach approximately 10% annually on delegated SQD.