Rewards & APY Explained

Rewards & APY Explained

One of the primary incentives for running a Flux node is earning $FLUX block rewards. Every block produced on the Flux blockchain distributes a fixed amount of newly minted FLUX to both miners and node operators. Understanding how these rewards are calculated, distributed, and affected by network conditions is essential for evaluating the economics of node operation.

Block Basics

The Flux blockchain targets a block time of approximately 2 minutes, which translates to roughly 720 blocks per day. Each block produces a reward that is split between proof-of-work miners and node operators. After the most recent halving event, the total block reward is approximately 37.5 FLUX per block (this figure decreases over time following the halving schedule).

Reward Distribution Split

Each block reward is divided between two groups: miners (who perform proof-of-work to secure the blockchain) and node operators (who provide compute infrastructure). The split is as follows:

The node operator portion (50%) is further subdivided among the three tiers and the Flux Foundation:

How Node Rewards Are Distributed

Flux uses a deterministic reward queue system rather than random selection. When a node first comes online and passes its initial benchmarks, it is placed at the back of the reward queue for its tier. As new blocks are produced, the node at the front of the queue receives the reward and is then moved to the back. This means every active, properly functioning node receives rewards in a predictable rotation.

The time between rewards depends on how many active nodes exist in your tier. If there are 5,000 active Cumulus nodes, each node will receive a reward approximately once every 5,000 blocks (since one Cumulus node is rewarded per block). At 2 minutes per block, that translates to roughly once every 7 days.

Reward Calculations by Tier

The following table provides example daily and monthly reward estimates based on a block reward of 37.5 FLUX and example node counts. Actual rewards will vary as the total number of active nodes and the block reward change over time.

APY Estimation

Annual Percentage Yield (APY) for Flux nodes is not fixed — it fluctuates based on the total number of active nodes, the current block reward, and the market price of FLUX. The formula for estimated annual return is:

Daily FLUX Reward = (Tier Share per Block × 720) / Active Nodes in Tier
Annual FLUX Reward = Daily FLUX Reward × 365
APY (%) = (Annual FLUX Reward / Collateral Amount) × 100

Example (Stratus with 1,500 nodes):
  Daily  = (15.0 × 720) / 1,500 = 7.20 FLUX/day
  Annual = 7.20 × 365 = 2,628 FLUX/year
  APY    = (2,628 / 40,000) × 100 = 6.57%

As more nodes join a tier, the per-node reward decreases and APY drops. Conversely, if nodes go offline, the remaining operators earn more. This self-balancing mechanism helps maintain economic equilibrium across the network.

Halving Schedule & Long-Term Economics

Like Bitcoin, Flux has a built-in halving schedule that reduces block rewards over time. Each halving event cuts the block reward in half, reducing the rate of new FLUX issuance. This deflationary pressure is designed to increase scarcity over time. The halvings occur at fixed block height intervals, and the approximate historical schedule is:

While halvings reduce the nominal FLUX earned per node, the expectation is that reduced supply growth combined with increasing demand for decentralized compute will support the token's market value, potentially offsetting the reduction in raw FLUX rewards with higher per-token purchasing power.

Claiming & Managing Rewards

Rewards are sent directly to the Flux address (t-address) associated with your node's collateral wallet. There is no manual claiming process — when your node reaches the front of the reward queue, the block reward is automatically included in the coinbase transaction and deposited to your address. You can view incoming rewards in Zelcore, SSP Wallet, or any Flux block explorer.