> For the complete documentation index, see [llms.txt](https://bitcoin-munari.gitbook.io/bitcoin-munari-whitepaper/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://bitcoin-munari.gitbook.io/bitcoin-munari-whitepaper/validator-network-architecture/reward-distribution-formula.md).

# Reward Distribution Formula

`Reward = (Validator Stake / Total Network Stake) × Daily Emission × Performance Multiplier`

***Performance Multiplier Based on Uptime:***

* <mark style="color:$danger;">99-100%</mark> uptime: 1.0x (full rewards)
* <mark style="color:$danger;">95-99%</mark> uptime: 0.8x (80% of rewards)
* <mark style="color:$danger;">90-95%</mark> uptime: 0.5x (50% of rewards)
* <mark style="color:$danger;">Below 90%</mark> uptime: 0x (no rewards + risk of slashing)

**Emission Schedule (10-Year Distribution):**

| Year | Annual Emission | Daily Emission | Approximate APY\* |
| ---- | --------------- | -------------- | ----------------- |
| 1    | 1,200,000 BTCM  | 3,288 BTCM     | 18-25%            |
| 2    | 1,000,000 BTCM  | 2,740 BTCM     | 15-20%            |
| 3    | 900,000 BTCM    | 2,466 BTCM     | 12-18%            |
| 4    | 750,000 BTCM    | 2,055 BTCM     | 10-15%            |
| 5    | 600,000 BTCM    | 1,644 BTCM     | 8-12%             |
| 6-10 | 328,000 BTCM/yr | 900 BTCM       | 5-10%             |

<sub>\*APY varies based on total network stake and individual validator performance</sub>

Example Validator Earnings:

**Scenario 1: Large Validator**

* Stake: 100,000 BTCM
* Uptime: 99.5%
* Assuming total network stake: 3,000,000 BTCM (Year 1)
* Daily rewards: (100,000 / 3,000,000) × 3,288 × 1.0 = \~109.6 BTCM/day
* Monthly rewards: \~3,288 BTCM
* Annual rewards: \~40,000 BTCM (40% APY)
* Monthly value at $6: \~$19,728
* Annual value at $6: \~$240,000

**Scenario 2: Small Validator**

* Stake: 10,000 BTCM (minimum)
* Uptime: 99%
* Assuming total network stake: 3,000,000 BTCM (Year 1)
* Daily rewards: (10,000 / 3,000,000) × 3,288 × 1.0 = \~10.96 BTCM/day
* Monthly rewards: \~329 BTCM
* Annual rewards: \~4,000 BTCM (40% APY)
* Monthly value at $6: \~$1,974
* Annual value at $6: \~$24,000

**Scenario 3: Delegated Staker**

* Delegation: 1,000 BTCM
* Validator commission: 10%
* Validator uptime: 99%
* Daily rewards: \~1.096 BTCM × 0.9 (after commission) = \~0.986 BTCM/day
* Monthly rewards: \~29.6 BTCM
* Annual rewards: \~360 BTCM (36% APY after commission)
* Monthly value at $6: \~$178
* Annual value at $6: \~$2,160