How are rewards distributed?
Foundation Nodes play a crucial role in the network and are consequently compensated accordingly for the services they offer. Here is how the reward system works for them:
- Service Rewards: When a user utilizes a service provided by the node operators, several nodes may be involved. For instance, in the case of a telephone call where Foundation Nodes facilitate call routing, the origin node and the destination node are key players. These two nodes undertake additional tasks such as voice encoding and decoding. Hence, all nodes involved will receive equal rewards from the transaction fee derived from the user's service consumption, except these two key nodes, which will receive a higher reward due to their increased workload.
- Block Production Rewards: Block production rewards comprise a fixed amount of KONE tokens, which are deducted from the total service fees included in the block.
For other types of services offered on the network, the reward system remains the same; the rewards are distributed among the nodes selected to execute the service. Additional rewards are allocated to those nodes performing a more significant workload.
Gatekeeper Node rewards are distributed using the KONE token. Like Foundation Nodes, these rewards are disseminated to the Gatekeeper Nodes in proportion to the service provided by each node in the delivery of the service.
- Service Rewards: If a village node has provided mobile to its users, there may be a large Gatekeeper Node in a nearby town and multiple mesh Gatekeeper Nodes between the village and town cooperating to deliver the service. Each node earns a share of the rewards according to their role in service delivery.
- Initial Gatekeeper Rewards: A designated 8% of the overall KONE supply is reserved specifically for initial Gatekeeper Rewards. This arrangement is meant to stimulate the deployment of Gatekeeper nodes during the early stages of the network. The amount of KONE allocated to Gatekeepers is a fixed sum, determined by The KONE DAO, and it's based on various factors, such as the type of radio and the area of deployment.
Operator Nodes accumulate rewards corresponding to the volume of traffic handled by the node. These rewards are allocated using the local stable currency, in compliance with the regulations of the country where the node is situated.
- Traffic Volume Rewards: The node's rewards are proportional to the volume of traffic it handles. These rewards are given in the local stable currency in line with the country's regulations where the node is based.