On-chain value distribution refers to how economic benefits and resources are allocated directly on a blockchain network. This encompasses the programmatic sharing of transaction fees, block rewards, protocol revenues, or other digital assets among network participants, such as validators, developers, and users. These distributions are transparently recorded and executed by smart contracts, adhering to the rules embedded within the blockchain’s protocol. It directly influences the economic incentives for network participation.
Context
The mechanisms of on-chain value distribution are a central topic in discussions about blockchain governance, sustainability, and the fairness of decentralized systems. News reports frequently scrutinize new tokenomics models and protocol upgrades, evaluating their impact on how value flows within the ecosystem and whether it promotes long-term network health.
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