Staking Rewards Without Minting New Tokens

Unlike many blockchain networks that inflate their token supply by minting new tokens for staking rewards, Krown Blockchain relies entirely on transaction fees. This ensures that the total supply remains capped at 100 billion KROWN, fostering scarcity and potential value appreciation while still rewarding participants for securing the network.

1. Staking Process

• How to Stake: Users can participate by locking up their KROWN tokens in a staking contract, accessible through the user-friendly Krown Wallet or KrownCash app. No specialized hardware is required beyond what’s needed to interact with the app, making staking accessible to a wide range of participants.

• Becoming a Validator: Staking KROWN tokens qualifies users as potential validators. The selection process is governed by a PoS algorithm that considers the amount of KROWN staked and an element of randomness. The more tokens a user stakes, the higher their probability of being chosen to validate transactions and earn rewards. This incentivizes greater participation while ensuring a fair and decentralized selection process.

2. Reward Pool from Transaction Fees

• Source of Rewards: Staking rewards are funded exclusively by transaction fees paid by users on the Krown Blockchain. Every transaction—whether a buy, transfer, or sell—incurs a fee that contributes to the reward system, eliminating the need for token inflation.

• Transaction Fee Structure: Fees consist of two components:

  • Base Fees: A standard fee attached to each transaction, which goes directly to the validator who processes the block containing that transaction.

  • Taxes: Additional taxes applied to specific actions—5% on buys and transfers, and 10% on sells. A percentage of these taxes is allocated to a staking rewards pool, while the remainder supports other ecosystem functions like treasury funding and marketing.

• Staking Rewards Pool: This pool accumulates a portion of the transaction taxes, ensuring a consistent reward reserve. It acts as a buffer, supplementing validator earnings even when individual blocks contain few transactions. The pool grows with network activity, aligning rewards with usage and demand.

3. Validator Selection and Rewards

• Selection Process: Validators are chosen periodically based on their staked KROWN and a randomized algorithm, a common practice in PoS systems to prevent centralization and ensure fairness. Once selected, a validator is responsible for confirming the validity of transactions and producing a block.

• Earning Rewards: Upon successfully validating a block, validators receive:

  • Base Transaction Fees: The sum of base fees from all transactions included in the validated block, providing immediate compensation for their efforts.

  • Share from the Staking Rewards Pool: An additional reward drawn from the staking rewards pool, funded by transaction taxes. This could be a fixed amount per block or proportional to factors like stake size or network activity, ensuring validators are consistently incentivized.

• No New Tokens: Unlike inflationary models, validators earn existing KROWN tokens from fees rather than newly minted ones, preserving the fixed supply. This ties rewards directly to the network’s economic activity, making the system self-sustaining.

• Scalability of Rewards: The staking rewards pool thrives on network usage. As transaction volume increases—driven by buys, sells, or transfers—the pool expands, boosting rewards for validators and reinforcing the network’s security.

4. Claiming Rewards

• Accessing Earnings: Validators can claim their accumulated rewards at regular intervals, such as daily, weekly, or per epoch (a predefined time period in the blockchain). This flexibility allows participants to manage their earnings effectively.

• Options for Rewards: Users can:

  • Re-stake: Lock their rewards back into the staking contract to compound their earnings over time, increasing their stake and validator selection odds.

  • Withdraw: Use rewards within the Krown ecosystem or transfer them elsewhere, supporting liquidity and utility.

• Activity-Driven Incentives: Since rewards are tied to transaction volume, validators are motivated to maintain an active and robust network. Higher usage translates to larger payouts, aligning participant interests with the blockchain’s growth.