Validator/staking rewards refer to the incentives received by validators for participating in the primary network validation process and helping to secure the blockchain network, better known as PoS; Proof of Stake. Validators are individuals or entities that contribute their computational power and resources to verify and validate transactions on the network.
When a validator successfully validates transactions and adds them to the blockchain, they can earn rewards in the form of additional tokens. These rewards serve as an incentive for validators to act honestly and maintain the network's security.
The specific details of validator/staking rewards can vary depending on the blockchain network. However, some common elements include:
1. Return of staked tokens: When a validator finishes validating the primary network, they receive back the tokens they staked. This ensures that validators have a vested interest in maintaining the network's integrity.
2. Validation rewards: Validators may also receive rewards for their role in securing the network and validating transactions. These rewards can be a percentage of the transaction fees generated on the network or additional tokens.
3. Reward percentage: The reward percentage for staking varies across different blockchain networks. It represents the annual return that validators can earn on their staked tokens. For example, a reward percentage of 8.5% means that validators can earn a return of 8.5% of their staked tokens per annualized percentage yield, or APY for short.
To learn more about Validators on Avalanche®, please read the following article.
See the Avalanche token paper to learn more about AVAX and the mechanics of staking.
For any additional questions, please view our other knowledge base articles or contact a support team member via the chat button.