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Stake, delegate, earn

· 3 min read
Mike Anderson
Mike Anderson
Hacker, Convex Foundation
Claude
Claude
AI Assistant, Anthropic

With Protonet live, Convex 0.8.0 switched on something the network's economics have been designed around from the start: automatic reward distribution to peers and delegated stakers, computed and paid entirely in consensus. No claiming transactions, no reward contracts to poke, no operator scripts — participation itself is the payout mechanism.

Two ways to stake​

Convex consensus is stake-weighted: a peer's influence in CPoS is proportional to the total stake behind it. That stake comes in two flavours with deliberately different risk profiles.

Peer stake is placed by the operator on their own peer. It's a warranty that the peer key is properly secured and the peer will maintain consensus honestly — and it's at risk if that warranty fails.

Delegated stake is placed by any coin holder on a peer they trust. It's a bet on the operator: delegated stake isn't at risk if the peer machine crashes or is compromised, but it does share the operator's fate if the peer's controller account is compromised. Delegators do real work for the network — evaluating operators and concentrating stake behind the trustworthy ones — and the reward mechanism pays them for it.

Note the consequence: security scales with the coin supply, not with the number of servers. A holder who never runs infrastructure still strengthens consensus by choosing good operators.

Where rewards come from​

Stakers earn a share of Convex Coins from two sources: transaction fees accumulated from executed blocks, and reward pools funded over time by the Convex Foundation. Distribution is proportional to stake — but weighted by something more interesting than mere size.

Rewards require participation​

Rewards scale with active time: the consensus-time elapsed between a peer's successfully executed blocks, capped in proportion to the peer's share of total stake. Concretely, a peer carrying 1% of staked supply must land a block roughly every ten minutes to bank its full active time; a larger stake tightens the requirement.

The effect is that rewards flow to peers that actually do the work of consensus — continuously, correctly, at a cadence matching their weight. A peer can't park a large stake, go quiet, and collect; idleness dilutes its own yield and nobody else's. And because all of this is computed inside the state transition function, there's nothing to claim and nothing to game: if the consensus ran, the accounting ran.

What to expect​

Staking on Convex is not passive yield — it's paid work with skin in the game. Peer operators are paid for keeping secure, live infrastructure; delegators are paid for allocating trust well. Both can lose stake if they do their job badly. We think that's exactly what a security budget should look like: every coin of reward traceable to a coin of risk taken and a service rendered.

Full details are in CAD016 (Peer Staking) and CAD020 (Tokenomics). If you hold coins, find a peer operator worth vouching for — the protocol handles the rest.