A reward structure defines how incentives are distributed to participants for their contributions to a blockchain network or decentralized application. This typically includes mechanisms for compensating validators, miners, or liquidity providers for securing the network, processing transactions, or facilitating economic activity. The design of these structures is critical for maintaining network security and operational viability.
Context
Discussions about reward structures are central to understanding the economic models of various cryptocurrencies and decentralized protocols. News frequently analyzes how changes to these structures impact participant behavior, network decentralization, and the long-term sustainability of a project. An optimized reward structure is essential for aligning incentives and promoting healthy ecosystem growth.
Mechanism design for verifiable computation is constrained by a theoretical limit on decentralization, forcing a strategic trade-off between speed and participation.
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