> ## Documentation Index
> Fetch the complete documentation index at: https://docs.fene.app/llms.txt
> Use this file to discover all available pages before exploring further.

# Staking Overview

> Understand staking mechanisms and rewards on Fenine Network

## Introduction

Fenine Network implements a unique **Federated Proof-of-Stake (FPoS)** consensus mechanism that combines validator staking with an innovative 8-level proximity reward system. This creates powerful economic incentives for network growth and decentralization.

<Info>
  **Quick Facts**:

  * Minimum Validator Stake: **10,000 FEN**
  * Minimum Delegation: **1,000 FEN**
  * Base APY: **10%**
  * Proximity Bonus: **Up to 12-15% total APY**
  * Epoch Duration: **200 blocks** (\~10 minutes)
</Info>

## How Staking Works

<Tabs>
  <Tab title="For Validators">
    ### Become a Validator

    **Requirements**:

    1. Stake minimum 10,000 FEN tokens
    2. Register through FenineSystem contract
    3. Provide commission rate (1-100%)

    **Responsibilities**:

    * Propose and validate blocks
    * Maintain high uptime (>95%)
    * Act honestly (subject to slashing)

    **Rewards**:

    * Block rewards: 3.5 FEN per block
    * Transaction fees (priority fees)
    * Commission from delegators
    * Proximity rewards from referrals

    **Example Monthly Earnings** (10,000 FEN staked):

    ```
    Base rewards:      ~83 FEN/month (10% APY)
    Commission (10%):  ~8 FEN from delegators
    Proximity bonus:   ~17 FEN (2% from network)
    ───────────────────────────────────────────
    Total:             ~108 FEN/month (13% APY)
    ```
  </Tab>

  <Tab title="For Delegators">
    ### Become a Delegator

    **Requirements**:

    1. Minimum 1,000 FEN tokens
    2. Choose a validator to delegate to
    3. Optional: Use referral code for proximity rewards

    **Benefits**:

    * Earn staking rewards without running infrastructure
    * Share in validator's block rewards
    * Participate in proximity reward network
    * Flexible: Undelegate anytime (21-day unbonding)

    **Rewards**:

    * Base APY: 10% (minus validator commission)
    * Proximity rewards from your referrals
    * No technical knowledge required

    **Example Monthly Earnings** (1,000 FEN delegated):

    ```
    Base rewards:      ~8.3 FEN/month (10% APY)
    - Commission 5%:   -0.4 FEN
    Proximity bonus:   ~1.7 FEN (2% from referrals)
    ───────────────────────────────────────────
    Net earnings:      ~9.6 FEN/month (11.5% APY)
    ```
  </Tab>

  <Tab title="Proximity System">
    ### 8-Level Referral Network

    Fenine's unique feature: earn rewards from **8 levels** of referrals.

    **How it Works**:

    ```
    You (Level 0)
    ├─ Direct Referrals (Level 1): Earn 7% of their rewards
    │  └─ Their Referrals (Level 2): Earn 5% of their rewards
    │     └─ Level 3: Earn 3%
    │        └─ Level 4: Earn 2%
    │           └─ Level 5: Earn 1.5%
    │              └─ Level 6: Earn 1%
    │                 └─ Level 7: Earn 0.5%
    │                    └─ Level 8: Earn 0.25%
    ```

    **Total Possible APY**: 10% base + up to 5% proximity = **15% APY**

    See [Proximity Rewards](/staking/proximity) for details.
  </Tab>
</Tabs>

## Staking Architecture

### Contract-Layer Validators

<Warning>
  **Important**: Fenine uses **contract-layer validators**, not traditional node-layer validators.

  Validator management happens entirely through the **FenineSystem** smart contract at `0x0000000000000000000000000000000000001000`.

  You do **NOT** need to run special validator node software. Block production and consensus happen automatically once you register as a validator.
</Warning>

### System Components

<CardGroup cols={3}>
  <Card title="FenineSystem" icon="gears">
    Core validator registry, staking logic, epoch management
  </Card>

  <Card title="RewardManager" icon="gift">
    Reward calculation, distribution, proximity tree
  </Card>

  <Card title="TaxManager" icon="receipt">
    Reward taxation (10%), burn mechanism
  </Card>
</CardGroup>

### Validator Lifecycle

```mermaid theme={null}
stateDiagram-v2
    [*] --> Pending: Stake 10K FEN
    Pending --> Active: Next epoch
    Active --> Jailed: Slashing event
    Active --> Unbonding: Voluntary exit
    Jailed --> Unbonding: Manual exit
    Unbonding --> [*]: 21 days later
```

**State Descriptions**:

| State         | Description                        | Can Validate? | Can Unstake?      |
| ------------- | ---------------------------------- | ------------- | ----------------- |
| **Pending**   | Registered, waiting for next epoch | ❌             | ✅ (no delay)      |
| **Active**    | Participating in consensus         | ✅             | ✅ (21-day delay)  |
| **Jailed**    | Penalized for misbehavior          | ❌             | ✅ (21-day delay)  |
| **Unbonding** | Waiting for unstake period         | ❌             | ⏳ (counting down) |
| **Exited**    | Fully unstaked                     | ❌             | ✅ (can restake)   |

## Reward Distribution

### Emission Schedule

**Annual Issuance**: 10,520,000 FEN (\~10.52% of max supply)

$$
E_{\\text{annual}} = 10,520,000 \\text{ FEN}
$$

**Block Reward**: 3.5 FEN per block

$$
R_{\\text{block}} = 3.5 \\text{ FEN}
$$

**Daily Emissions**: \~28,800 blocks/day

$$
E_{\\text{daily}} = \\frac{86,400}{3} \\times 3.5 \\approx 100,800 \\text{ FEN/day}
$$

### Reward Formula

For a validator with stake $S_v$ and delegated stake $S_d$:

$$
R_{\\text{validator}} = R_{\\text{base}} + R_{\\text{commission}} + R_{\\text{proximity}}
$$

Where:

* $R_{\\text{base}} = \\frac{S_v}{S_{\\text{total}}} \\times E_{\\text{epoch}}$
* $R_{\\text{commission}} = \\frac{S_d}{S_{\\text{total}}} \\times E_{\\text{epoch}} \\times c$
* $R_{\\text{proximity}} = \\sum_{i=1}^{8} \\sum_{j \\in L_i} R_j \\times \\alpha_i$

**Parameters**:

* $S_{\\text{total}}$: Total network stake
* $E_{\\text{epoch}}$: Epoch emission (700 FEN)
* $c$: Validator commission rate (e.g., 0.05 = 5%)
* $\\alpha_i$: Proximity coefficient for level $i$

<Accordion title="Example Calculation">
  **Scenario**:

  * Your stake: 10,000 FEN
  * Delegated to you: 50,000 FEN
  * Total network stake: 10,000,000 FEN
  * Your commission: 10%
  * Epoch emission: 700 FEN

  **Base Rewards**:

  $$
  R_{\\text{base}} = \\frac{10,000}{10,000,000} \\times 700 = 0.7 \\text{ FEN}
  $$

  **Commission Rewards**:

  $$
  R_{\\text{commission}} = \\frac{50,000}{10,000,000} \\times 700 \\times 0.10 = 0.35 \\text{ FEN}
  $$

  **Total per Epoch**: 1.05 FEN (\~144 epochs/day = 151 FEN/day)

  **Monthly**: \~4,530 FEN (\~54% APY on 10K stake)
</Accordion>

## Economic Model

### Dual Burn Mechanism

Fenine implements two deflationary mechanisms:

<AccordionGroup>
  <Accordion title="1. EIP-1559 Base Fee Burn">
    Every transaction burns the base fee:

    $$
    B_{\\text{1559}} = \\text{BaseFee} \\times G_{\\text{used}}
    $$

    **Annual Burn** (at 10 gwei average):

    $$
    B_{\\text{annual}} \\approx 1,580,000 \\text{ FEN}
    $$

    This is \~15% of annual emissions.
  </Accordion>

  <Accordion title="2. Transaction Fee Taxation">
    When claiming staking rewards:

    * 10% tax on claimed rewards
    * Tax goes to treasury for development and ecosystem growth

    **Note**: This tax does NOT reduce circulating supply. Only EIP-1559 base fee burn is deflationary.
  </Accordion>

  <Accordion title="Net Inflation">
    **Supply Dynamics**:

    $$
    \\Delta S = E_{\\text{annual}} - B_{\\text{1559}}
    $$

    **Scenarios**:

    | Network Activity | Base Fee    | EIP-1559 Burn | Net Inflation     |
    | ---------------- | ----------- | ------------- | ----------------- |
    | Low              | 1 gwei      | 158K FEN      | +10.36M (+10.36%) |
    | Medium           | 10 gwei     | 1.58M FEN     | +8.94M (+8.94%)   |
    | **High**         | **67 gwei** | **10.6M FEN** | **-80K (-0.08%)** |
    | Very High        | 100 gwei    | 15.8M FEN     | -5.28M (-5.28%)   |

    <Info>
      Network becomes **deflationary** at 67 gwei average base fee.
    </Info>
  </Accordion>
</AccordionGroup>

## Risk Factors

<Warning>
  **Understand the Risks**:

  1. **Slashing**: Validators can lose stake for misbehavior (double-signing, downtime)
  2. **Unbonding Period**: 21 days to withdraw after unstaking
  3. **Commission Changes**: Validators can change commission rates
  4. **Smart Contract Risk**: Staking happens via smart contracts
  5. **Market Risk**: FEN price volatility affects USD value of rewards
</Warning>

### Slashing Conditions

| Offense           | Penalty        | Description                              |
| ----------------- | -------------- | ---------------------------------------- |
| **Double-Sign**   | 5% slash       | Signing two blocks at same height        |
| **Downtime**      | Jailed         | \<95% uptime over 200 blocks             |
| **Invalid Block** | 1% slash       | Proposing invalid block                  |
| **Censorship**    | Warning → Jail | Consistently ignoring valid transactions |

Slashed funds are burned, reducing total supply.

## Getting Started

<Steps>
  <Step title="Choose Your Path">
    **Validator** or **Delegator**?

    * Have 10,000+ FEN + technical skills → Validator
    * Have 100+ FEN, want passive income → Delegator
  </Step>

  <Step title="Get FEN Tokens">
    * Buy on exchanges (CEX/DEX)
    * Bridge from other chains
    * Minimum: 10,000 FEN (validator) or 100 FEN (delegator)
  </Step>

  <Step title="Set Up Wallet">
    * MetaMask, Trust Wallet, or hardware wallet
    * Add Fenine Network (Chain ID: 5881)
    * Secure your private keys
  </Step>

  <Step title="Stake Your FEN">
    **Validators**: See [Run a Validator](/staking/run-validator)

    **Delegators**: See [Become a Delegator](/staking/become-delegator)
  </Step>

  <Step title="Earn Rewards">
    * Claim rewards via stake.fene.app
    * Compound for higher APY
    * Share referral code for proximity rewards
  </Step>
</Steps>

## Staking Options Comparison

| Feature                | Validator                 | Delegator                       |
| ---------------------- | ------------------------- | ------------------------------- |
| **Minimum Stake**      | 10,000 FEN                | 100 FEN                         |
| **Technical Skills**   | Required                  | Not required                    |
| **Infrastructure**     | Optional (contract-layer) | None                            |
| **Base APY**           | 10%                       | 10% (minus commission)          |
| **Additional Rewards** | Commission + Proximity    | Proximity only                  |
| **Slashing Risk**      | Yes                       | No (validator slashed, not you) |
| **Governance**         | Full voting power         | Proportional to stake           |
| **Unbonding Period**   | 21 days                   | 21 days                         |

## Frequently Asked Questions

<AccordionGroup>
  <Accordion title="Do I need to run a node to be a validator?">
    **No!** Fenine uses contract-layer validators. You only need to:

    1. Stake 10,000 FEN via smart contract
    2. Register your validator address
    3. Set your commission rate

    The protocol automatically includes you in block production. You CAN run a node for RPC access or network monitoring, but it's not required for validation.
  </Accordion>

  <Accordion title="What happens if my delegated validator gets slashed?">
    **Delegator Protection**: If your validator is slashed, only the validator's stake is penalized, not yours.

    However:

    * Validator may be jailed (stop earning)
    * You may want to redelegate to active validator
    * No unbonding period when redelegating
  </Accordion>

  <Accordion title="Can I stake from a hardware wallet?">
    **Yes!** Staking works with:

    * Ledger (via MetaMask connection)
    * Trezor (via MetaMask connection)
    * Any wallet supporting custom EVM chains

    For maximum security, use hardware wallet for staking.
  </Accordion>

  <Accordion title="How do I maximize my APY?">
    **Strategies**:

    1. **Auto-compound**: Claim and restake rewards weekly
    2. **Build proximity network**: Share referral code
    3. **Choose low-commission validator**: More rewards for you
    4. **Stake early**: APY decreases as network grows
    5. **Become validator**: Earn commission from delegators

    Realistic range: **10-15% APY** with active participation.
  </Accordion>

  <Accordion title="What is the unbonding period?">
    **21 days** for both validators and delegators.

    When you unstake:

    1. Tokens enter "unbonding" state
    2. Stop earning rewards immediately
    3. After 21 days, can withdraw to wallet

    **Why?** Security measure to prevent rapid unstaking during attacks.
  </Accordion>

  <Accordion title="Can I lose my staked FEN?">
    **Validators**: Yes, via slashing for misbehavior.

    **Delegators**: No slashing risk directly, but:

    * Smart contract risk (audited but not zero)
    * Market risk (FEN price volatility)
    * Opportunity cost (locked for 21 days if unbonding)

    Always stake amounts you can afford to lock up.
  </Accordion>
</AccordionGroup>

## Resources

<CardGroup cols={2}>
  <Card title="Stake Now" icon="hand-holding-dollar" href="https://stake.fene.app">
    Official staking interface
  </Card>

  <Card title="Run a Validator" icon="server" href="/staking/run-validator">
    Complete validator setup guide
  </Card>

  <Card title="Become a Delegator" icon="users" href="/staking/become-delegator">
    Delegation tutorial
  </Card>

  <Card title="Proximity Rewards" icon="network-wired" href="/staking/proximity">
    Referral system explained
  </Card>

  <Card title="FPoS Architecture" icon="building" href="/architecture/fpos">
    Technical deep dive
  </Card>

  <Card title="FenineSystem Contract" icon="file-contract" href="/api-reference/contracts/fenine-system">
    Smart contract API reference
  </Card>
</CardGroup>

<Note>
  **Need Help?**

  * Discord: [#staking-support](https://discord.gg/fenines)
  * Email: [staking@fene.network](mailto:staking@fene.network)
  * Staking Dashboard: [stake.fene.app](https://stake.fene.app)

  Validator Office Hours: Fridays 2PM UTC
</Note>