Reward Mechanics
This section provides a technical overview of how XDC Liquid Staking rewards are generated, calculated, and distributed - the core economic engine that partners are integrating.
Reward Source
Rewards come from XDC Network validator staking. PrimeStaking operates masternodes that participate in the XDC consensus mechanism and earn block rewards.
Unlike ETH-based liquid staking protocols, XDC Network does not implement slashing. This means staked capital is never at risk from validator behavior - a structural advantage for partners and their users.
Why Use PrimeStaking vs. Direct Staking
Direct XDC staking requires running a masternode (10M XDC minimum, infrastructure management, uptime obligations). PrimeStaking removes all of these barriers:
Minimum
10,000,000 XDC
None
Infrastructure
Run and maintain a masternode
Fully managed
Liquidity
Locked until unstake
Liquid (psXDC is transferable and tradeable)
Slashing risk
None (XDC model)
None (XDC model)
Reward rate
Depends on your node's uptime
Pooled across optimized validators
Composability
None
psXDC usable in DeFi
For partners, this means their users can access XDC staking yield with zero infrastructure burden and no minimum deposit.
Calculation
Gross APY
Determined by XDC Network validator economics
Protocol fee
Percentage retained by the protocol (contact us for specifics)
Net user APY
~4.5% (after protocol fee)
Distribution basis
Proportional to psXDC balance
The net APY is variable and depends on:
Network staking ratio - total XDC staked across the network affects per-validator rewards
Validator performance - uptime and block production efficiency
Protocol fee - the percentage retained by the protocol before user distribution
Distribution
Rewards accrue continuously as validators produce blocks
Users claim rewards manually from the Rewards contract
Reward amounts are calculated proportionally based on psXDC holdings at claim time
All distributions are on-chain and verifiable
Key Parameters for Partners
Reward token
psXDC
Frequency
Continuous accrual
APY
~4.5% (variable)
Claiming
Manual (user-initiated)
On-chain verifiable
Yes
Variable/Fixed
Variable (depends on validator performance and network conditions)
Slashing risk
None
How APY Is Determined
Validator economics - XDC Network masternodes earn block rewards based on the network's consensus parameters
Protocol fee - A percentage of gross validator rewards is retained by the protocol
Net distribution - Remaining rewards are distributed proportionally to all psXDC holders
Dynamic rate - APY fluctuates with network activity, validator count, and total staked XDC across the network
Transparency & Verification
Every reward event is logged on the XDC blockchain
Reward calculations are deterministic and auditable
Partners can independently verify reward distributions via on-chain data
Historical reward data is available for forecasting and reporting
psXDC supply and staking pool balance are verifiable on-chain at any time via XDCScan
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