Q: Why staking rewards decrease over time ?

Q: Why staking rewards decrease over time ?

By KayDee | $PAW FAQ | 7 Jun 2022


Imagine staking reward is a pizza. It's a full pizza, always the same size

The daily staking reward is a pizza slice. That slice is cut precisely, so you can get always the same slice everyday for the full staking period. So everyday, you'll get the same slice size


Now imagine you invite friend to eat that slice everyday. If you have 3 friends, you each get a 4th of it (3+1 or 25%). If 4 friends you only get 20% of it (1/5 as 4+1 in total). With staking it is the same. The more people join, the smaller the part

Now imagine that your friends eat the slice depending on their weight. The more fat friend will get the bigger part of the slice and the slimest will get a very small piece. Same about staking, the more you stake, the bigger part you'll get.

But now here is the trick : if you don't spend why you eat, you'll get fater day after day, you'll get more weight, so you'll get a bigger part. This is the same with auto-staking. You don't take your reward but you let them in the staking pool, so you get more weight.

Of course, your friends might invite their friends, which might be slim or fat, auto-stake or not and all that would make your part of the slice diminue each day

Feel free to leave some comment if you need more details

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