Rewards Distribution to Nodes

The reward for a Computation is split equally among the Arx nodes in the Cluster where the Computation is executed. Inside each Arx node, the rewards are calculated pro-rata based on the sizes of stake delegations to the node. If there is a surplus of stake delegated to an Arx node — meaning that all of the node's hardware is already active/eligible to execute work, yet there's still more stake delegated to the node — then a sub-linear function curve is applied (only) to the delegated stake that exceeds the amount of stake required to meet the node's specification of available resources (see the Self-Claimed Hardware Specification section). As a result, once all of a node's hardware is actively working, returns continually diminish for excess stake. This enforces a near-linear relationship between the amount of stake delegated to a node and the size of computational resources that the node has available — this way, since slashing is proportional to the size of Computations where the misbehavior occurred, there is always a proportionally sufficient amount of stake available to cover any slashing that occurs. Additionally, the application of the curve functions to prevent centralization of stake on single nodes beyond an amount that is proportional to the service they provide to the Network, thus keeping the Network open and competitive to other honest node operators seeking 3rd-party delegations.

To be clear, the distribution of rewards to Clusters is entirely based on the number of Computations performed by each Cluster, and the distribution of rewards to nodes within a Cluster is entirely egalitarian in the context of the Cluster.

The Leader Node

For each Computation, one of the nodes in the selected Cluster is randomly selected to act as the "Leader" node. The Leader node has the additional minor task of collecting the shares for each output from each participating node in the Cluster. Since the Leader node must complete a small amount of extra work for the Computation, it receives a proportionally minor additional amount of compensation for this extra work.