So you want to learn how to calculate the PoS block validation rewards (staking rewards) when staking in the PoS Finality Chain?
Staking rewards depend on:
Circulating Suppy (
C): Total circulating supply of CFX. This can be obtained from sources such as CoinMarketCap.
Staked Supply (
S): Total amount of staked CFX by all validators. This quantity must be estimated. A good back-of-the-napkin estimate is to sum all of the staked supply from public pools.
Base Interest Rate (
i): Fixed base interest rate, fixed at 4%.
Staked CFX (
staked-CFX): The amount of CFX that you stake.
You can estimate the staking rewards in the PoS Finality Ledger, with the following formula:
PoS Interest Rate = sqrt(C / S) * i
Annual Staking Profit = staked-CFX * PoS Interest Rate
Let’s do a test run!
Say there’s a circulating supply of 1.43B (at the time of this post) and there’s currently 50,000,0000 CFX staked across all nodes.
PoS Interest Rate would be:
PoS Interest Rate = sqrt(1,430,000,000 / 100,000,000) * 0.04), or
This means that we would get a 15.1261% of interest rate per each staked CFX.
Now, let’s say that we want to stake 10,000 CFX. Our annualized staking profit would be
Annualized Staking Profit = 10,000 * 0.1513, or
As you can see, this a slightly more complex mechanism to estimate staking rewards than the governance site, but can yield greater profits. I hope this helps out!