VRC-7: Universal Staker Rewards

VRCs/vrc-7.md

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+# VRC-7: Universal Staker Rewards
+
+| VRC   | Title                  | Status | Type      | Authors    | Created    |
+|-------|------------------------|--------|-----------|------------|------------|
+| VRC-7 | Universal Staker Rewards | Draft  | Technical | V from Finquarium | 2025-01-05 |
+
+## Abstract
+
+This VRC proposes extending staker rewards to all DLP stakers regardless of their DLP's ranking, while maintaining the current treasury reward structure for top-ranked DLPs only. 
+This change aims to incentivize staking across a broader range of DLPs while preserving the competitive aspect of DLP treasury rewards.
+
+## Motivation
+
+The current reward system, where only stakers of top-ranked DLPs receive rewards, creates several challenges:
+
+1. Limited incentive to stake with lower-ranked DLPs, even if they provide valuable data services
+2. Difficulty for new DLPs to attract stake and climb rankings
+3. Reduced network decentralization due to stake concentration in top DLPs
+4. Misalignment between network growth goals and staking incentives
+
+Extending staker rewards while maintaining DLP treasury reward restrictions would:
+- Encourage stake distribution across more DLPs
+- Support emerging DLPs with valuable data sources
+- Enhance network decentralization
+- Maintain competitive pressure on DLP performance
+
+## Specification
+
+The proposal modifies reward distribution mechanics:
+
+1. Staker Rewards:
+   - All stakers receive rewards proportional to their stake
+   - Reward calculation includes all staked tokens network-wide
+   - Maintains compatibility with VRC-3 variable staking splits
+
+2. DLP Treasury Rewards:
+   - Continue to be restricted to top-ranked DLPs
+   - No changes to treasury reward calculation
+   - Maintains compatibility with VRC-4 sublinear distribution
+
+## Rationale
+
+This design maintains network security while improving decentralization:
+
+1. Universal Staker Rewards:
+   - Encourages broader stake distribution
+   - Supports emerging DLPs
+   - Aligns with network growth goals
+
+2. Restricted Treasury Rewards:
+   - Maintains competitive pressure
+   - Preserves incentives for operational excellence
+   - Supports sustainable network economics
+
+## Security & Privacy Considerations
+
+Security implications:
+- Potential for increased stake volatility
+- More complex reward calculations
+- Increased network state transitions
+
+Mitigations:
+- Maintain existing staking periods
+- Optimize reward distribution computation
+- Comprehensive testing of new distribution logic
+
+## Implementation
+
+Implementation Timeline:
+
+Phase 1 (Pre-deployment):
+- Smart contract updates
+- Economic simulation and testing
+- UI updates to reflect universal rewards
+
+Phase 2:
+- Deploy contract updates
+- Monitor stake distribution changes
+- Gather community feedback
+
+Required Changes:
+- Update reward distribution contracts
+- Modify subgraph indexing
+- Update UI to show reward eligibility
+- Add new monitoring metrics
+
+## Copyright
+
+Copyright and related rights waived via [CC0](https://creativecommons.org/publicdomain/zero/1.0/).