Tokenomics
Tokenomics describes the supply schedule, reward mechanics, and economic incentives that keep a Proof of Stake network healthy.
- Consensus Rewards: Validators receive new LYX or LYXt that are minted for timely proposals and attestations.
- Execution Fees: Validators receive priority fees and tips from end‑users on top of the burnt base fee.
- Penalties and Slashing: The validator's stake may be deducted for downtime or malicious voting behaviour.
Staking returns are typically expressed as Annual Percentage Rate, assuming permanent validator uptime.
- The LUKSO Mainnet has an APR of around 7%
- The LUKSO Testnet has an APR of around 42%
APR Calculation
Returns only include the deterministic and major values of the consensus mechanism.
| Component | Included | Notes |
|---|---|---|
| ✅ Yes | Set by the protocol and scaled with active stake on the network. | |
| ❌ No | Directly paid to the proposer to boost returns during highly network utilization. | |
| ❌ No | Indirectly paid to block proposer and searchers for manipulating transaction order. | |
| ❌ No | Directly paid to the proposer broadcasting a proof of network misbehaviour. |
Further details about slashing and MEV can be found within the Slasher Service and Proof of Stake pages.
Earnings and Withdrawals
Validators manage two on‑chain addresses to receive withdrawals and returns.
| Address Type | Description | Mutability |
|---|---|---|
| Receives auto‑pushed consensus rewards through block proposals and in case of an exit, the remaining LYX or LYXt of the validator. | The address can be set during the validator key generation or withdrawal update and is immutable after stake has been deposited as defined by EIP‑4895. | |
| Collects the priority fees, tips, and MEV commission earned by the proposing validator. | The address is mutable and can be updated during every start of the validator node. |
Both addresses can be equal, in case stakers want to manage earnings and funds with one single account.
Changing the withdrawal address requires exiting the validator and redepositing the stake to a new validator key.
Both addresses are ordinary Externally Owned Accounts that can be generated from regular EOA wallets within the browser, apps, or on hardware wallets. Ensure your wallet supports LUKSO or has the capability of adding Custom EVM Networks. Otherwise you may be unable to access rewards or must export the private key into another wallet before acessing the funds.
Withdrawal Cadence
A maximum of 16 consensus payouts to the withdrawal address can be processed per block.
| Network | Active Validators | Daily Blocks | Payout Interval |
|---|---|---|---|
| LUKSO Mainnet | ~140.000 | ~7.200 | 29 Hours |
| LUKSO Testnet | ~4.000 | ~7.200 | 50 Minutes |
Semi‑Deflationary Supply
Since the London Update, EVM-based networks feature a transaction base fee that is burned during every block proposal. As outlined by EIP‑1559, the update actively decreases the circulating supply of the blockchain's native coin. If demand pushes the occupied block space above 50 percent, the base fee rises by up to 12.5 percent. The total of burned funds can frequently exceed newly minted consensus rewards, giving the network semi‑deflationary dynamics.
- Sustained high activity will produce negative issuance periods for LYX and LYXt
- Lighter traffic periods will results in smaller and decreasing amounts of burned funds
As burned funds scale with demand while issuance scales with stake, the ultra‑sound effect grows when the network is busy.