Incentives and Value Flow

Verification Fees

Verification is the core value event in the network.

Let:

• N_t​ = number of verifications in period t

• fee_t = fee per verification ($VELOCITY)

Total fees collected:

F_t=N_t×fee_t

Issuer Reward

Issuers earn when verifications occur. Issuer reward can be divided between the Credential Issuer and Credential Agent Operator (the service provider that operates the agent on behalf of the Issuer).

Let:

• V_ij​ = number of verifications of credentials issued by issuer j

• p = issuer share per verification fee (in $VELOCITY) ≈ 1/9

Issuer revenue is:

IssuerReward_j,t=p×V_ij

Issuers are therefore incentivized to issue credentials that:

• are accurate

• are compliant

• have real economic utility

• are demanded by relying parties

Issuance volume alone produces no reward.

Oracle Node Operator Reward

Delegators and node operators share rewards.

Target staking yield:

Y_target≈3% annually

Yield sources transition over time:

1. bootstrap phase — emissions dominate

2. growth phase — mixed emissions + fees

3. maturity phase — fees dominate, emissions approach zero

This produces yield that is:

• transparent

• bounded

• increasingly utility-backed