In addition to XRD emissions, Radix Tokens Jersey Limited (RTJL) will provide an additional “subsidy” incentive specifically for validator node-runners. The subsidy will be drawn from a reserve of 600m XRD tokens, created at the network’s genesis and held by RTJL for purposes such as this. These subsidy rewards are not a feature of the Radix Protocol and are provided directly from RTJL to the validator node-runner. To meet RTJL’s regulatory obligations, only node-runners that successfully complete Know Your Customer (KYC) checks may be eligible for subsidy rewards.
Subsidy rewards are provided to cover the costs of running a validator node to ensure that anyone who has the technical skill and commitment to run a good reliable validator node can do so. The quantity of XRD provided will be continuously adjusted by RTJL to provide a USD-equivalent value to cover good node hosting and operation costs comfortably. To begin with, we expect this to be approximately $500 per month for full participation in consensus, but it may be adjusted as we learn more about real costs.
In the same way as emissions, the quantity of subsidy XRD will be reduced by the penalty for missed participation in consensus.