New to working with held amounts? No worries! If you just need to see the schedule, you can skip down to the bullet list in the second half of this post. Otherwise, a good place to understand the underlying reasons for having held-amounts at all is our blog explaining why Churn & Burn is Bad for everyone
The short explanation is that the earning potential of a node, our network performance and - most important - file durability are all strongly affected by node operator reliability. We do everything we can to reward a healthy supply/demand balance, including the encouragement of “graceful exit” by storage node operators (SNOs) leaving the system.
You don’t need an upfront stake to start earning STORJ tokens. Instead, there is a 9-month period in which a percentage of earning are placed in a holding account. The funds stay there until a SNO chooses to leave the network. At 15 months, a portion of the balance is returned to the SNO, while the remainder is held indefinitely.
So, that means that if a SNO uses the graceful exit function when leaving the network, the funds are returned to the SNO when leaving the network. We want all departures to be graceful of course! If a SNO leaves without completing that graceful exit, then the funds will be forfeited to offset the cost of data repair caused by the storage node exit.
A helpful way to understand what this all means to you is to check out the table below, which shows the withholding model. The function is structured with a tiered reduction in withholdings as time goes by.
Months 1-3 : 75% of storage node revenue is withheld, 25% is paid to the storage node operator
Months 4-6 : 50% of storage node revenue is withheld, 50% is paid to the storage node operator
Months 7-9 : 25% of storage node revenue is withheld, 75% is paid to the storage node operator
Months 10-15 : 100% of storage node revenue is paid to the storage node operator
Month 15 : 50% of total withholdings are returned to storage node operator, with the remaining 50% held until the node gracefully exits the network
The withholding model is designed to:
Incentive and reward long term reliable storage nodes
Ensure with fairness that nodes choosing to leave the network do so in a way that’s the least damaging to the network
The withholding and payout is one thing. . . The other is the increasing loss of value of Storj coins. What Storj has lost in value in the last few days, is quite remarkable. But if you have a look at the loss in value since its introduction . . ., the value can hardly fall much lower. The profitability of many nodes also depends on the value of the Storj coin. Since the introduction of STORJ, I have not seen a similar decline in value for the dollar or the euro.
You decide whether you take on that market risk. You can sell your tokens the moment you get them if you don’t want to take the risk.
The current drop has nothing to do with Storj btw. It’s a drop seen throughout all the crypto currencies. Unfortunately crypto currency has started to correlate with the stock markets and we’re seeing the impact of a certain human bug going around. Not much we can do about that, though I’m sure that in time it will recover.
The question is: if I start with 550gb and then during month 7-9 I decide to increase storage size … will I still keep 100% of the revenue generated by the new added capacity?
heald ammount and capacity are not related at all. just first 9 month part of revenue go to held ammount thats all, if you add space nothing will not change.
Sorry to bump, but, why is it that after month 15, you only get 50% until you gracefully exit? What does this achieve? In my opinion, after the first 10 months, you should just get 100%, and there should be no 15 month period. PS: Can you gracefully exit, then rejoin the network and still be in the month 15 status?
It’s for data repair fees if you don’t gracedully.exit… Other nodes have to rebuild that lost data and get paid for it. That comes from the escrow being held by the node that didn’t gracefully exit. (Partiallly)
The first 9 months of your revenue, part of it, gets held back. All revenue after that point is yours.
That first 9 months of partial revenue is used to pay other nodes to repair the data if you don’t gracefully exit your node from the network when you decide to leave, if you ever do.
If you want that partially held amount, and you don’t want any further earnings, then you would gracefully exit your node to receive it. But if you start a new node, it would take 9 months before you started earning 100% of all income. So, it would make a lot more sense to keep your node running rather than gracefully exit and start a new node.