Incentive

Proof of Transaction (PoT) Incentives

1. User Participation and Delegation:

   • Users join the PoT verification system by creating transactions on the Biturbo network.

   • They delegate their transaction activities to validators. This delegation is based on the transaction fees (gas fees) spent by users.

2. Transaction Fee-Based Rewards:

   • The more gas fees a user spends, the higher their contribution to the network. Users earn TBO tokens proportional to the transaction fees they contribute.

   • Miner efficiency in the PoT system is directly related to the transaction fees spent by users on their addresses on the Bitcoin mainnet.

3. Validator Block Production:

   • Validators produce blocks based on the number and volume of transactions they process. Validators with higher transaction volumes are prioritized for block production.

   • Rewards are distributed through validators to the users who delegated their transaction activities.

4. Rewards Distribution:

   • Users receive rewards based on their miner efficiency and the duration they delegate to validate the network. The formula for reward calculation is:

     $$\text{User Reward} = \text{Miner Efficiency} \times \text{Duration of Delegation}$$
   • Rewards are distributed in TBO tokens, incentivizing continuous and active participation in the network.

Proof of Liquidity (PoL) Incentives

1. Liquidity Provision and Delegation:

   • Users provide liquidity to the network’s pools, ensuring there are sufficient assets for transactions.

   • Liquidity providers delegate their assets to validators. This delegation influences the validator’s ability to produce blocks.

2. Liquidity-Based Rewards:

   • Users earn rewards based on the amount of liquidity they provide. The more liquidity a user contributes, the higher their rewards.

   • Miner efficiency in the PoL system is directly related to the amount of liquidity provided by users for TBO.

3. Validator Block Production:

   • Validators produce blocks based on the proportional liquidity delegated to them. Validators with more liquidity are prioritized for block production.

   • Rewards are distributed through validators to the liquidity providers.

4. Rewards Distribution:

   • Users and validators receive rewards based on their miner efficiency and the duration of liquidity delegation. The formula for reward calculation is:

     $$\text{User Reward} = \text{Miner Efficiency} \times \text{Duration of Delegation}$$
   • Rewards are distributed in TBO tokens, promoting active participation and ensuring network security and stability.

The incentive for both Proof of Transaction (PoT) and Proof of Liquidity (PoL) is set at 250 million TBO each, representing 25% of the total token supply for each mechanism. This results in a combined total mining incentive of 50% of the total token supply. Both PoT and PoL incentives follow the same vesting schedule, ensuring consistency and fairness in reward distribution. The detailed incentive schedule for PoT and PoL is provided below:

Month	Emission (TBO)
1	50016231.2
2	40012984.96
3	32010387.96
4	25608310.37
5	20486648.3
6	16389318.64
7	13111454.91
8	10489163.93
9	8391331.143
10	6713064.914
11	5370451.931
12	4296361.545
13	3437089.236
14	2749671.389
15	2199737.111
16	1759789.689
17	1407831.751
18	1126265.401
19	901012.3207
20	720809.8566
21	576647.8852
22	461318.3082
23	369054.6466
24	295243.7172
25	236194.9738
26	188955.979
27	151164.7832
28	120931.8266
29	96745.46127
30	77396.36901
31	61917.09521
32	49533.67617
33	39626.94093
34	31701.55275
35	25361.2422
36	20288.99376

Example Case: Alice and Bob Join PoT and PoL Mining (Month 1)

In the first month, the total monthly reward is 50,016,231.2 TBO. We'll calculate the rewards for Alice and Bob based on their contributions to the Proof of Transaction (PoT) and Proof of Liquidity (PoL) systems.

Assumptions

1. Total Monthly Reward for Month 1: 50,016,231.2 TBO

2. Alice and Bob's Participation:

   • PoT:

     • Alice processes 60% of the total transactions fee (culmulative).

     • Bob processes 40% of the total transactions fee (culmulative).

   • PoL:

     • Alice provides 70% of the total liquidity.

     • Bob provides 30% of the total liquidity.

Proof of Transaction (PoT)

1. Total Monthly Reward for PoT: 50,016,231.2 TBO

2. Alice's Contribution: 60%

3. Bob's Contribution: 40%

Alice's Reward:

$$\text{Alice's Reward (PoT)} = 50,016,231.2 \times 0.60 = 30,009,738.72 \text{ TBO}$$

Bob's Reward:

$$\text{Bob's Reward (PoT)} = 50,016,231.2 \times 0.40 = 20,006,492.48 \text{ TBO}$$

Proof of Liquidity (PoL)

1. Total Monthly Reward for PoL: 50,016,231.2 TBO

2. Alice's Liquidity Contribution: 70%

3. Bob's Liquidity Contribution: 30%

Alice's Reward:

$$\text{Alice's Reward (PoL)} = 50,016,231.2 \times 0.70 = 35,011,361.84 \text{ TBO}$$

Bob's Reward:

$$\text{Bob's Reward (PoL)} = 50,016,231.2 \times 0.30 = 15,004,869.36 \text{ TBO}$$

Summary for Month 1

• Alice's Total Reward:

$$\text{Alice's Total Reward} = 30,009,738.72 \text{ TBO (PoT)} + 35,011,361.84 \text{ TBO (PoL)} = 65,021,100.56 \text{ TBO}$$

• Bob's Total Reward:

$$\text{Bob's Total Reward} = 20,006,492.48 \text{ TBO (PoT)} + 15,004,869.36 \text{ TBO (PoL)} = 35,011,361.84 \text{ TBO}$$