Reward Distribution
The values and parameters on this page are preliminary and subject to change before launch.
This page explains how staking rewards are distributed among stakers and how each individual share is calculated.
Two Distribution Factors
The share of daily rewards depends on two factors:
Staked Amount
Number of MSIG tokens locked
Multiplier
Value based on lock duration (0.083x to 2.0x)
The effective stake combines these two factors. A longer lock results in a higher multiplier, leading to a larger share of rewards even with the same staked amount as a position with a shorter lock.
The system computes effective stake, determines each position's share of the total pool, and distributes rewards proportionally each day.
How Distribution Works
The effective stake is defined as the number of staked tokens multiplied by the vote-escrow multiplier:
Reward Share Calculation
The reward share is defined as effective stake divided by the total effective stake of all stakers.
Daily Reward Calculation
The daily reward is calculated as the individual reward share multiplied by the total daily reward pool.
APY Estimation
The APY (Annual Percentage Yield) projects the daily reward rate over a full year.
Where:
staked_i= staked MSIG token amountmultiplier_i= vote-escrow multiplier (0.083x to 2.0x based on lock duration)effective_stake_i= weighted stake contribution to the poolreward_share_i= proportion of the daily reward pool (value between 0 and 1)daily_pool= total daily rewards available (see Staking Rewards)daily_reward_i= MSIG tokens received per dayAPY_i= estimated annual percentage yield
Practical Examples
Example 1: Basic Reward Calculation
Staked: 10,000 MSIG with 1-year lock (1.0x multiplier)
Daily pool: 30,000 MSIG
Total effective stake: 12,000,000
effective_stake=10,000×1.0=10,000daily_reward=30,000×0.00083=25 MSIG/dayAPY=10,00025×365×100%=91%
Example 2: Multiplier Impact Comparison
User 1: 10,000 MSIG with 2-year lock (2.0x multiplier)
User 2: 10,000 MSIG with 1-month lock (0.083x multiplier)
Daily pool: 30,000 MSIG
Total effective stake: 12,000,000
effective_stakeuser1=10,000×2.0=20,000effective_stakeuser2=10,000×0.083=830
User 1: 30,000 × 0.00167 = 50 MSIG/day
User 2: 30,000 × 0.00007 = 2 MSIG/day
With the same staked amount, User 1 receives 24x more rewards due to their longer lock.
APY Disclaimer: No specific APYs are guaranteed. Actual reward rates depend on the total staked amount, treasury balance, and individual lock duration. Any examples shown are for illustrative purposes only.
Auto-Compounding
The staking system includes an optional auto-compound feature. When enabled, rewards are automatically restaked at the current lock duration. This causes the effective stake to grow over time, and future rewards are calculated based on a larger balance.
Example: Starting with 10,000 MSIG and earning a 0.25% daily reward rate:
1
10,000
25
10,025
2
10,025
25
10,050
3
10,050
25
10,075
...
...
...
...
30
~10,753
~27
~10,780
With compounding, the staked balance grows at an accelerated rate compared with non-compounded rewards, because each reward accrual increases the principal on which subsequent rewards are calculated.
Last updated

