Proposal to Change Masternode & Staking Reward Structure
Proposal #3 is the suggestion to restructure masternode rewards to a “timelock based structure” and is a direct precursor to proposal #4. At this time 20,000 ION are required to host a masternode. In Matlack’s words, “You can move in and out of masternode status in about 24 hours, you have no penalty, and you get half the block reward.” The ION team proposes the following solution to maintain a stronger masternode presence as more work begins to be offloaded to the second layer.
“If you were to lock up your initial 20,000 ION output for 30 days, when you hit a block instead of your master node getting 50% and the staking node getting 50% reward, your masternode would instead get 55% and the staking node would get 45%” with higher gains the longer the coins are locked up.
Proposed Reward Structure
![](https://ip.bitcointalk.org/?u=https%3A%2F%2Fi.gyazo.com%2Ff637dad5af18ba9cdb5809d95dad8936.png&t=663&c=ompr0qOcoHmwaA)
According to Matlack, “what this does is 2 things, it encourages people to lock coins up for a longer time to prevent the flipping of it and if they (masternode owners) want the economic advantage of receiving a payout, say 25% higher than a normal masternode then they can commit to locked stake....This is a big deal and we (the ION team) feel strongly that it should be like this." Overall, if this proposal is voted in by the community, “If you make a longer commitment there's a better outcome for you” and in theory, a better outcome for the network.
https://ion.community/topic/2357/proposal-to-change-masternode-staking-reward-structure