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Economic Incentives

Orbinum Network aligns all participants through a comprehensive incentive structure that rewards honest behavior, quality performance, and network contribution. This page catalogs every economic incentive in the protocol.

Miner Incentives​

Miners provide AI inference compute and compete on quality within Orbits.

Rewards​

Block Emissions

  • Earn 80% of all block emissions, distributed quality-weighted across Orbits
  • Proportional to quality score within each Orbit
  • Declines over 10-year emission schedule

Inference Fees

  • Earn 63.7% of total user fees (65% of remaining after Orbit owner commission)
  • Direct compensation for executing AI inference tasks
  • Scales with network usage and request volume

Quality Bonus Rewards

  • Additional rewards for maintaining top-tier quality scores over extended periods
  • Incentivizes consistent high performance

Request Routing Priority

  • Top 25% quality tier receives 70% of all requests
  • 25-50% tier receives 20% of requests
  • Direct correlation between quality ranking and earning potential

Protections​

Immunity Period

  • 12-hour protection period upon registration (7,200 blocks)
  • Cannot be deregistered during this period
  • Assigned median quality score for initial request routing

Auto-Staking

  • Automatically compound rewards into stake
  • Increases protection against deregistration
  • Configurable via miner settings

Requirements​

Stake Requirement

  • 1,000 $ON per Orbit (locked, not burned)
  • Returned upon voluntary exit or deregistration
  • Provides collateral for slashing

Validator Incentives​

Validators secure the blockchain and evaluate AI inference quality.

Rewards​

Block Production Rewards

  • Earn rewards for each block produced
  • Includes base block reward and transaction fees
  • Distributed via era points system

Block Emissions

  • Earn 20% of all block emissions
  • Distributed proportionally by stake weight
  • Consistent passive income stream

Finalization Rewards

  • Earn rewards for participating in GRANDPA finalization voting
  • Critical for achieving deterministic finality
  • Contributes to era points accumulation

Quality Evaluation Fees

  • Earn 17.64% of total user fees (18% of remaining after Orbit owner commission)
  • Compensation for evaluating miner performance
  • Requires permit (top validators by stake)

Orbit Evaluation Fees

  • Additional revenue from evaluating new Orbits during 2-week testing periods
  • Compensates validators for assessment work
  • Paid by Orbit owners

Era Points

  • Accumulated through block production, finalization, and quality evaluation
  • Determines proportional reward distribution at era end
  • Incentivizes active participation

Commission

  • Set commission rate (0-100%) on nominator rewards
  • Balances validator earnings with nominator attractiveness
  • Recommended: 5-15% for competitiveness

Permit System

  • Top validators by stake earn permits for quality evaluation
  • Access to additional fee streams
  • Incentivizes stake accumulation

Protections​

Immunity Period

  • 12-hour protection upon entering active set (7,200 blocks)
  • Cannot be slashed for minor performance issues during this period
  • Major offenses (equivocation) not covered

Requirements​

Minimum Stake

  • 10,000 $ON minimum self-stake
  • Must receive sufficient nominations for active set selection
  • Active set size: up to 297 validators

Nominator Incentives​

Nominators back validators with their stake without running infrastructure.

Rewards​

Validator Reward Share

  • Share validator rewards after commission deduction
  • Proportional to stake contribution
  • Expected APR: 12-20% (after 10% validator commission)

Nomination Pool Rewards

  • Participate with as little as 1 $ON via pools
  • Proportional rewards based on pool contribution
  • Auto-compounding available

Auto-Compounding

  • Automatically reinvest rewards into stake
  • Increases future earning potential
  • Configurable reward destination

Governance Voting Power

  • Staked tokens provide voting power in protocol governance (Phase 2)
  • Influence protocol upgrades and treasury spending
  • Conviction multipliers increase voting weight

Requirements​

Minimum Stake

  • 100 $ON minimum for direct nomination
  • 1 $ON minimum via nomination pools
  • Can nominate up to 16 validators

Staker Incentives​

Passive token holders who stake for real yield.

Rewards​

Real Yield

  • Earn 14.7% of all user fees (15% of remaining after Orbit owner commission)
  • Non-inflationary passive income
  • No active participation required

Governance Rights

  • Voting power on protocol upgrades and treasury allocation
  • Influence network direction
  • Democratic participation in decision-making

Conviction Multipliers

  • Increase voting power by locking tokens longer
  • Up to 6x voting power (32-day lock)
  • Trade liquidity for governance influence

Orbit Owner Incentives​

Orbit owners create and maintain specialized AI networks.

Rewards​

Infrastructure Commission

  • Earn 2% commission on all inference fees generated by Orbit
  • Taken first, before other fee distributions
  • Scales with Orbit usage and adoption

Token Appreciation

  • Orbit growth increases token value
  • Successful Orbits attract more miners and users
  • Long-term value creation

Requirements​

Registration Stake

  • 1,000 $ON (locked, not burned)
  • Must pass 2-week testing period
  • Validation fees paid during testing

Slashing (Negative Incentives)​

Economic penalties for malicious behavior or poor performance.

Validator Slashing​

Equivocation

  • Producing conflicting blocks or votes
  • Penalty: 0.1% minimum, increasing exponentially
  • Affects validator and all nominators

Unresponsiveness

  • Missing blocks or finalization votes
  • Penalty: 0.01% per missed session
  • Validator automatically chilled (removed from active set)

Invalid Quality Evaluation

  • Consistently fraudulent or outlier assessments
  • Penalty: 0.5-5% depending on severity
  • Affects validator only (nominators protected)

Double-Signing

  • Signing conflicting messages with same session keys
  • Penalty: 10-100% of stake
  • Cryptographic proof required

Miner Slashing​

Performance Slashing

  • Repeated low-quality responses: 1-5% stake slash
  • Excessive latency: 0.5-2% stake slash
  • Availability failures: 0.5-2% stake slash

Malicious Behavior

  • Fraudulent proofs: 10-50% stake slash
  • Coordinated attacks: 100% stake slash + ban
  • Data manipulation: 25-100% stake slash

Deregistration Risk

  • Lowest-ranked miners replaced when Orbit is full
  • Automatic competitive selection
  • Stake returned after unbonding period

Governance Slashing​

Proposal Bond Slashing

  • Bond slashed if proposal rejected as spam
  • Minimum bond: 100 $ON
  • Returned if proposal accepted or passes

Orbit Slashing​

Protection Mechanisms​

Time-locks and safeguards that protect participants and network stability.

Unbonding Period

  • 28-day waiting period before token withdrawal
  • Prevents rapid stake withdrawal during attacks
  • Partial unbonding available for nominators

Slashing Delay

  • 28-day delay before slashing execution
  • Allows governance appeal for unjust slashing
  • Transparent verification period

Enactment Delay

  • 8-day delay before governance changes take effect
  • Allows community to update software or exit network
  • Prevents surprise protocol changes

Understanding Incentive Alignment​

All incentives in Orbinum are designed to create Nash equilibrium where honest participation is the dominant strategy:

For Miners: Quality maximization earns highest rewards → Quality is optimal strategy

For Validators: Accurate evaluation aligns with consensus → Honesty is optimal strategy

For Nominators: Selecting high-performing validators maximizes returns → Due diligence is optimal strategy

For Orbit Owners: Attracting quality miners and users maximizes fees → Fair governance is optimal strategy

Next Steps​