How does that ASTOR loyalty payout system work?

Every month ASTOR distributes the pool rewards that were not needed to it's loyal delegators. 

The rational behind it is that 6 x 340 => 2040 ADA p.m. pool reward is much more than we actually need to run our infrastructure and we would therefore like to give back to folks who support our project ...

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... despite knowing that they would get more ROA when delegating to a much larger pool.

It took a while to put this idea into practise, because I wanted to do this in Haskell so that I could largely automate the process.

Here is how it works …

  • We take a snapshot of who has delegated to ASTOR consistently over the last six epochs
  • We calculate the average stake for every stake address that qualifies
  • From the pool rewards we subtract 1% margin that goes to charity
  • We then subtract the actual running cost, which is very little
  • We further subtract a tax escrow, which is subject to local tax regulations
  • The remainder is distributed proportionally among delegators who qualify
  • You qualify when your payout value is >= 1 ADA (enforced by the network)
  • Finally, we generate a transaction with metadata that publishes the details

Although, ASTOR is still a small pool you’ll get the benefit of a much larger pool because we believe that most of the reward should go to delegators and charity, provided that ASTOR can still run smoothly with whatever is left. In essence, a delegator to ASTOR is on equal terms with its owner.

At the time of writing, we had already paid out 2454 ADA in four rounds to loyal delegators. This is 19,98% on top of what the Cardano network had paid out already.

With the upcoming completion of Alonzo, we will get Plutus smart contracts on Cardano. This will also be the time when the beneficiary of ASTOR pool rewards will become such a smart contract, the code for that is ready. 

Starting from Q4/2021, much higher payouts will hopefully be possible because tax will likely not need to be held in escrow any more. These loyalty payouts can then become an automatic feature of the delegation process itself - you may not want to miss that.

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