# Staking Reward Types Explained

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{% tab title="Percent Reward" %}
The reward percentage determines how many tokens investors earn relative to their staked amount over the course of a year. This percentage represents your annual return on staked tokens.

**Example:** Let's look at how a 100% annual reward ratio works:

Initial stake:

* You stake 1,000 tokens
* The reward ratio is set to 100% per year
* This means you earn tokens equal to 100% of your stake over one year

After one year:

* Your original 1,000 staked tokens are returned to you
* You receive 1,000 additional tokens as rewards (100% of your stake)
* Total tokens: 2,000 (1,000 original + 1,000 rewards)

If the ratio was set to 50% instead:

* Your original 1,000 staked tokens would be returned
* You would receive 500 tokens as rewards (50% of your stake)
* Total tokens: 1,500 (1,000 original + 500 rewards)

The higher the percentage, the more reward tokens investors earn relative to their staked amount.
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{% tab title="Fixed Rewards" %}
In a fixed rewards pool, users receive rewards proportional to their stake amount, where the total yearly reward remains constant and is distributed among all participants. When new users join, existing users' rewards are reduced proportionally to maintain the fixed total.

**Example:** Consider a pool with a fixed yearly reward of 10 tokens:

Initially, three users stake different amounts:

* User A stakes 100 and receives 1 tokens/year (10% of stake, 10% of rewards)
* User B stakes 300 and receives 3 tokens/year (30% of stake, 30% of rewards)
* User C stakes 600 and receives 6 tokens/year (60% of stake, 60% of rewards) Total staked: 1000 tokens, Total yearly rewards: 10 tokens

Then User D joins and stakes 1000 tokens. The total stake is now 2000 tokens, but the yearly reward stays at 10 tokens. The rewards are recalculated:

* User A with 100 staked (5% of total) now receives 0.5 tokens/year
* User B with 300 staked (15% of total) now receives 1.5 tokens/year
* User C with 600 staked (30% of total) now receives 3 tokens/year
* User D with 1000 staked (50% of total) receives 5 tokens/year

Each user's reward is proportional to their share of the total stake, and the total yearly reward remains fixed at 10 tokens.
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{% tab title="Only If Balance Rewards" %}
In this reward type, there is no fixed annual rate. Instead, rewards are distributed whenever the pool owner adds them, with each staker receiving a share proportional to their staked amount.

**Example:** Let's say there are three stakers in the pool:

* User A has staked 100 tokens (10% of pool)
* User B has staked 300 tokens (30% of pool)
* User C has staked 600 tokens (60% of pool) Total staked: 1,000 tokens

When the pool owner adds 500 reward tokens:

* User A receives 50 tokens (10% of rewards)
* User B receives 150 tokens (30% of rewards)
* User C receives 300 tokens (60% of rewards)

Later, if the owner adds another 1,000 reward tokens:

* User A receives 100 tokens
* User B receives 300 tokens
* User C receives 600 tokens

Rewards are only distributed when the owner adds them, and the amount each user receives depends on their percentage of the total stake at that time.
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{% tab title="No Reward Staking" %}
In this staking type, instead of earning additional tokens as rewards, users receive a "staked version" of their token that can be used for special purposes like governance rights or access to exclusive features.

**Example:** Let's say you want to participate in a project's governance:

* You stake 1,000 GEMS tokens
* You receive 1,000 sGEMS (staked GEMS) tokens in return
* Your original GEMS are locked in the staking contract
* Your sGEMS can now be used to:
  * Vote on governance proposals
  * Access exclusive features
  * Participate in project decisions

When you unstake:

* Your sGEMS are sent back
* Your original GEMS are returned
* You lose access to governance/features until you stake again

The value comes from the utility of the staked token (sGEMS) rather than from earning additional rewards. Projects might require tokens to be locked for a minimum period to prevent governance manipulation or ensure long-term commitment.
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