Every block distributes tao and alpha into every subnet.

See Subnet Emission tao and alpha for details.

alpha_out distribution

Each subnet's incentive mechanism breaks down the distribution of the Subnet's alpha_out to the active participants of the subnet. There is 1 alpha_out every block. (until alpha reaches it's Halving.)

Subnet mechanisms

Each subnet can have multiple mechanisms (they were formerly called sub subnets.). This means that each subnet can work to solve multiple challenges. In V1 of subnet mechanisms, all miners and validators can compete in all mechanisms.

The subnet owner can divide the alpha_out distribution to the subnet mechanisms as a mechanism percentage:

   pub fn sudo_set_mechanism_emission_split(
            origin: OriginFor<T>,
            netuid: NetUid,
            maybe_split: Option<Vec<u16>>,

The maybe_split vector is used to divide the subnet's emission amongst subnet mechanisms.

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Examples

If there are 2 mechanisms, they might be split evently 50:50. Or a subnet with new subnet mechanism might want to start that new mechanism at a lower value (90:10).

Eventually, there will be a maximum of 8 subnet mechanisms allowed per subnet.

In each mechanism

• Subnet Owner: The subnet owner receives 18% of the emissions. (0.18 alpha)
• Miners Miners split 41% of emissions. (0.41 alpha)
• Validator Validators (and their stakeholders) split 41% of emissions. (0.41 alpha)

Individual Miner rewards

• Miners are awarded emissions based on their incentive score.
• The sum of incentive across all of the validators in a subnet is equal to 1.
• incentive is updated every tempo (generally 360 blocks).
• Miners receive alpha_out * .0.41 * incentive *360 every tempo for each subnet mechanism.
• The incentive received in each mechanism is weighted by the mechanism split, and the sum is awarded to the miner.

See Emission for Minersfor more details on how incentive is awarded to miners.

Individual Validator rewards

• Validator rewards are calculated on each submechanism, and aggregated to the subnet through the mechanism split weighting.
• Subnet validator rewards are split between the validator and their stakeholders.
• Validators with higher VTrust and higher stake (both root and alpha) will receive higher rewards.
• Parent/Child Hotkeys play a role in how how validator rewards are returned.
• Validator rewards are returned in tao and alpha, as stakeholders can hold Root and Alpha stake.

See Emissions for Validators for detail on how incentive is awarded to validators.