The emission schedule
Just over thirty percent of the supply, 50 billion L2P, pays the validators that secure the chain. It is not held by a team wallet or released by a decision: it sits in the ValidatorSet contract and is paid out per block, on a schedule the contract enforces, over roughly ten years.
The shape of it
Year one pays nothing. The presale runs through the first chain year, so emission starts at block 21,038,400 rather than at block zero.
Then 317 L2P per block for five years. That is about 6.67 billion a year.
Then it halves, to 158 L2P per block, for another five years. About 3.33 billion a year.
Then it stops. After the second halving window the contract emits nothing further, because the pool is empty.
Blocks arrive roughly every one and a half seconds, which works out at about 21 million blocks a year. That is where the year boundaries below come from.
Year by year
| Year | Blocks | Rate | Emission | Cumulative | Pool left | Paid |
|---|---|---|---|---|---|---|
| Y1 | 0 to 21,038,400 | 0 | 0.00B | 0.00B | 50.00B | 0.0% |
| Y2 | 21,038,400 to 42,076,800 | 317 | 6.67B | 6.67B | 43.33B | 13.3% |
| Y3 | 42,076,800 to 63,115,200 | 317 | 6.67B | 13.34B | 36.66B | 26.7% |
| Y4 | 63,115,200 to 84,153,600 | 317 | 6.67B | 20.01B | 29.99B | 40.0% |
| Y5 | 84,153,600 to 105,192,000 | 317 | 6.67B | 26.68B | 23.32B | 53.4% |
| Y6 | 105,192,000 to 126,230,400 | 317 | 6.67B | 33.35B | 16.65B | 66.7% |
| Y7 | 126,230,400 to 147,268,800 | 158 | 3.32B | 36.67B | 13.33B | 73.3% |
| Y8 | 147,268,800 to 168,307,200 | 158 | 3.32B | 39.99B | 10.01B | 80.0% |
| Y9 | 168,307,200 to 189,345,600 | 158 | 3.32B | 43.32B | 6.68B | 86.6% |
| Y10 | 189,345,600 to 210,384,000 | 158 | 3.32B | 46.64B | 3.36B | 93.3% |
| Y11 | 210,384,000 to 231,422,400 | 158 | 3.32B | 49.97B | 0.03B | 99.9% |
The halving lands at block 126,230,400, which is 105,192,000 blocks after emission started. The second window ends at 231,422,400, and by then the pool is all but empty.
How the contract does it
Four values drive the whole table, and all four are readable on-chain.
| Parameter | Value at genesis | What it does |
|---|---|---|
emissionRatePerBlock |
317 L2P | How much is created per block in the first window |
emissionHalvingPeriod |
105,192,000 blocks | How long a window lasts, about five years |
emissionMaxHalvings |
2 | How many windows there are before emission stops |
| Emission pool | 50,000,000,000 L2P | The total the contract can ever pay out |
Each block, the contract works out which window it is in, halves the rate once per completed window, and pays that amount to the active validators in proportion to their voting power. Jailed validators get nothing. Once the pool is empty, or once the window counter passes the maximum, the payments stop whatever else happens.
Blocks that arrive before the start block emit nothing at all, which is why year one is empty rather than half full.
After the emissions end
Validators keep earning from transaction fees, which is the other half of what a validator is paid, and the half that does not run out. What ends is the creation of new coins.
From that point the only thing changing the circulating supply is the burn, which runs in the other direction. See Fee burn.
Can this be changed?
The rate, the halving period and the number of halvings are governance parameters, so a proposal that passes and clears the timelock can adjust them within the limits the contract enforces. The rate may be set anywhere from 1 to 317 L2P per block, the halving period cannot be shorter than a million blocks, and the number of halvings has to stay between 1 and 20.
Read that first limit again: 317 is the genesis rate and also the ceiling. Governance can slow issuance down, and can never speed it up.
What cannot be changed is the pool. The 50 billion is what the contract holds, and no parameter can make it pay out more than it has. Governance can change the pace; it cannot change the total.
What governance can change lists these parameters alongside the rest.
What a validator has at stake
Emissions are one side of validator economics. The other is what a validator stands to lose, and those figures are set at genesis too.
| Parameter | L2P at genesis |
|---|---|
| Minimum self delegation | 7,000,000 |
| Burned when the validator is created | 3,500 |
| Slash for downtime | 35,000 |
| Slash for a double sign | 700,000 |
A validator has to bond seven million L2P of its own before it may run at all. Downtime costs it half a percent of that floor, and a double sign costs it ten percent. Those are not fines to be absorbed as a cost of doing business, which is the point of setting them against the self-stake rather than against the reward.
Slashed stake comes out of self delegation first, which is why the self-delegation figure matters to delegators as much as to operators. Run a validator covers what earns and what costs.
Malicious voting carries the same penalty as a double sign, but the check that detects it is switched off at genesis and stays off until governance enables it. What governance can change explains why, along with the other two things that ship inactive.