Rewards System Overview

Design Principles

Sela Network’s rewards system is designed to ensure sustainable network growth and equitable value distribution among participants in a decentralized infrastructure.

Core Principles

Contribution-Proportional Rewards

Rewards are distributed in proportion to network contribution. Node operators receive differentiated compensation based on request volume processed, performance tier, and uptime. Developers earn revenue based on ecosystem tool usage and quality.

Long-Term Participation Incentives

Vesting mechanisms are applied to encourage long-term contribution over short-term speculation. Staking requirements and performance-based reward structures ensure stable network operation.

Transparency

All reward distributions are recorded on-chain and verifiable by anyone. Smart contracts execute automatically according to predefined rules, implementing a trustless reward system.

Sustainability

The system maintains a virtuous cycle where the reward pool expands naturally as network usage increases. Token burn mechanisms and treasury management ensure long-term economic stability.

Participant Roles and Rewards

Node Operators

Node operators provide web access infrastructure to AI agents by operating distributed browser nodes within the network.

Reward Components:

Base network rewards: Distributed from the Node Contributor allocation (420M SELA) per epoch proportional to staking ratio
API request processing fees: Direct compensation for processed requests (70% of fees)
Performance incentives: Bonuses based on response time, uptime, and success rate (up to +30%)
Staking rewards: Base yield on tokens provided as network security collateral
$SPWR (Sela Power Points): Earned through node operation and web access request processing

$SPWR (Sela Power Points) System

$SPWR is a points-based reward system that recognizes node operator contributions to network infrastructure. Sela Network tracks node operator contributions through $SPWR points.

Earning $SPWR:

Node operators earn $SPWR points through:

Node Operation: Continuous uptime and network participation
- Base points per hour of active node operation
- Bonus points for maintaining high uptime (95%+)
- Geographic distribution bonuses for underserved regions
Web Access Request Processing: Direct contribution to network utility
- Points proportional to requests processed
- Quality bonuses for high success rates
- Performance bonuses for fast response times
- Complexity bonuses for handling zk-TLS requests

Point Calculation Example:

Daily $SPWR Earnings:
├─ Base operation: 24 hours × 10 points/hour = 240 points
├─ Request processing: 1,000 requests × 0.5 points = 500 points
├─ Performance bonus (S-tier): +30% = 150 points
└─ Total: 890 $SPWR points/day

$SPWR Utility:

1. Governance Participation

$SPWR points grant governance voting rights in network decision-making. Points holders can:

Vote on protocol upgrades and parameter changes
Propose and vote on treasury expenditure
Participate in network policy decisions
Influence development roadmap priorities

Voting power is proportional to $SPWR holdings, ensuring active contributors have meaningful influence over network evolution.

2. Token Conversion

$SPWR points can be converted to $SELA tokens through a conversion mechanism, providing liquidity and direct value realization.

Conversion Mechanism:

Conversion Rate: Dynamic rate based on network demand and token economics
Conversion Windows: Periodic conversion periods to manage token supply
Minimum Threshold: Minimum $SPWR balance required for conversion
Vesting Options: Option for immediate conversion or vested conversion with bonus rates

Conversion Example:

10,000 $SPWR points
├─ Immediate conversion: 10,000 × 0.001 = 10 SELA
└─ Vested conversion (12 months): 10,000 × 0.0012 = 12 SELA (+20% bonus)

3. Network Benefits

$SPWR points provide additional network benefits:

Priority node selection for high-value requests
Reduced staking requirements for higher tiers
Access to exclusive node operator features
Early access to new network capabilities

Token Allocation:

Node operators receive rewards from the 420,000,000 SELA (42% of total supply) allocated to the Node Contributor pool. This allocation is distributed over time based on:

Network participation and uptime
Staking amount and duration
Performance metrics (response time, success rate)
Geographic distribution needs
$SPWR point accumulation

Tier Structure:

Node operators are classified into tiers based on staking amount: Bronze (100 SELA), Silver (500 SELA), Gold (2,000 SELA), Platinum (10,000 SELA), and Diamond (50,000 SELA). Higher tiers receive priority task assignment, governance participation rights, and dedicated support. $SPWR points can supplement staking requirements for tier advancement.

Developers

Developers extend network functionality by creating ecosystem tools, parsers, scripts, and SDKs.

Reward Components:

Marketplace sales revenue: 70% of parser and script sales proceeds
Grant program: Funding from Foundation Treasury (150M SELA allocation) for projects contributing to ecosystem development
Bug bounty: Rewards from Community allocation (30M SELA) for security vulnerability discovery and reporting
Open-source contribution rewards: Incentives from Community allocation for core protocol improvement contributions

Token Allocation:

Developers benefit from multiple token allocations:

Foundation Treasury (150M SELA): Grant programs for significant ecosystem contributions
Community (30M SELA): Bug bounties, open-source contributions, and community initiatives
Marketplace revenue: Direct revenue from parser and script sales

Marketplace Revenue Distribution:

Parser sale price: Developer-determined
  ├─ 70% → Developer
  ├─ 20% → Protocol treasury
  └─ 10% → Token burn

Users

Individual and enterprise users who utilize the platform and participate in the community.

Incentive Structure:

Points system: Earn Sela Points proportional to API usage
Early adopter bonus: Additional points and token rewards from Community allocation (30M SELA) for initial users
Referral program: Rewards from Community allocation for both referrer and referee upon new user acquisition
Governance participation: Token holders participate in network policy decisions through voting

Token Allocation:

Users receive incentives from the Community allocation (30M SELA - 3% of total supply), which includes:

Early adopter bonuses
Referral program rewards
Community contribution rewards
Points-to-token conversion programs

Points-to-Token Conversion:

Sela Points is an off-chain point system convertible to $SELA tokens upon meeting certain conditions. Points can be used for API discounts, premium feature access, and other purposes. Token conversion draws from the Community allocation.

Token Economics

Token Supply and Distribution

$SELA has a total supply of 1,000,000,000 (1 billion) tokens, allocated as follows:

Token Distribution:

Total Supply: 1,000,000,000 SELA (100%)

├─ Ecosystem: 600,000,000 SELA (60%)
│  ├─ Foundation Treasury: 150,000,000 SELA (25% of Ecosystem)
│  ├─ Node Contributor: 420,000,000 SELA (70% of Ecosystem)
│  └─ Community: 30,000,000 SELA (5% of Ecosystem)
│
├─ Investors: 100,000,000 SELA (10%)
│  ├─ Private: 75,000,000 SELA (75% of Investors)
│  ├─ Public: 15,000,000 SELA (15% of Investors)
│  └─ KOL: 10,000,000 SELA (10% of Investors)
│
├─ Team & Advisors: 100,000,000 SELA (10%)
│  ├─ Team: 80,000,000 SELA (80% of Team & Advisors)
│  └─ Advisors: 20,000,000 SELA (20% of Team & Advisors)
│
├─ Marketing: 100,000,000 SELA (10%)
│
└─ Liquidity: 100,000,000 SELA (10%)
   ├─ CEX: 80,000,000 SELA (80% of Liquidity)
   └─ DEX: 20,000,000 SELA (20% of Liquidity)

Allocation Details:

Ecosystem (60% - 600M SELA)

Node Contributor (420M SELA): Distributed to node operators over time based on network participation, staking, and performance. This allocation incentivizes infrastructure provision and network growth.
Foundation Treasury (150M SELA): Managed by the foundation for protocol development, grants, partnerships, and strategic initiatives. Expenditure requires governance approval.
Community (30M SELA): Allocated for community programs, early adopter rewards, referral bonuses, bug bounties, and ecosystem development initiatives.

Investors (10% - 100M SELA)

Private (75M SELA): Early investors with vesting schedules aligned with network milestones.
Public (15M SELA): Public sale allocation for broader community participation.
KOL (10M SELA): Key opinion leaders and strategic partners supporting network growth.

Team & Advisors (10% - 100M SELA)

Team (80M SELA): Core team members with multi-year vesting schedules to ensure long-term commitment.
Advisors (20M SELA): Strategic advisors contributing expertise and network connections.

Marketing (10% - 100M SELA)

Dedicated allocation for marketing campaigns, user acquisition, partnerships, and brand development.

Liquidity (10% - 100M SELA)

CEX (80M SELA): Centralized exchange liquidity pools for trading accessibility.
DEX (20M SELA): Decentralized exchange liquidity pools for decentralized trading.

$SELA Token Functions

$SELA is the native utility token of Sela Network, serving the following functions:

Network Fees

AI agents pay fees in $SELA when calling APIs or requesting zk-TLS proofs. Fees are dynamically adjusted based on network congestion, request complexity, and region.

Staking Collateral

Node operators must stake a minimum of 100 SELA to acquire network participation eligibility. Staking acts as security collateral and is subject to slashing (partial or full forfeiture) for malicious behavior.

Governance

$SELA holders possess voting rights on network policies, protocol upgrades, and treasury expenditures. Voting power is proportional to holdings and staking duration.

Marketplace Payments

Parsers, scripts, and datasets created by developers are purchased with $SELA. The marketplace is a core mechanism for network ecosystem expansion.

Reward Distribution Mechanisms

Automated Distribution

Smart Contract-Based Execution

All rewards are distributed automatically through blockchain smart contracts. Execution is fair according to predefined rules without human intervention, with all transactions transparently recorded on-chain.

Distribution Cycles

Reward Type	Distribution Cycle	Method	Description
API fees	Real-time	Automatic	Paid to node operators immediately upon processing
Base network rewards	Per epoch	Automatic	Periodic distribution proportional to staking ratio
Performance bonuses	Weekly	Automatic	Bonuses paid by tier after performance metric aggregation
Grant program	Upon milestone	Manual	Approval and payment after project progress review

Fee Structure

API Usage Fees

Per-request cost varies dynamically based on network demand, request complexity, and node region. Expected range is 0.001~0.1 SELA.

Fee Distribution:

User-paid fee: 100%
  ├─ 70% → Request processing node operator
  ├─ 20% → Protocol treasury (development, operations, grant program)
  └─ 10% → Burn (deflationary mechanism)

Variable Factors:

Network congestion: Fees increase with rising demand
Request complexity: Additional fees for zk-TLS proof generation
Node region: Fees increase in regions with rising node demand

Slashing

Purpose and Principles

Slashing is an economic penalty mechanism in Proof of Stake networks designed to prevent malicious or negligent behavior. Staked tokens serve as collateral to ensure honest node operator conduct.

Violation Types and Penalties

Severe Violations (Immediate Full Forfeiture):

Data manipulation: Providing false data in API responses
Fraudulent proof generation: Forgery or manipulation of zk-TLS proofs
Network attacks: Participation in DDoS, Sybil attacks, etc.
Double signing: Simultaneous execution of identical validator keys on multiple nodes

Minor Violations (Warnings and Progressive Penalties):

Violation Type	1st Violation	2nd Violation	3rd Violation
Low performance (< 80%)	Warning	10% reward reduction	30% reward reduction
Downtime (< 95%)	Warning	Warning	20% reward reduction
SLA violation	Warning	5% reward reduction	Temporary suspension

Penalty Structure:

Slashing consists of three stages: immediate penalty, exit waiting period, and correlation penalty (penalties increase when multiple nodes simultaneously violate). Slashed nodes cannot rejoin the network and require new validator keys and staking.

Ecosystem Fund

Foundation Treasury

The Foundation Treasury holds 150,000,000 SELA (15% of total supply), allocated from the Ecosystem pool. This treasury supports long-term network development and sustainability.

Revenue Sources:

Initial allocation: 150M SELA from token distribution
Protocol fees: 20% of API fees (ongoing revenue)
Marketplace fees: 20% of parser sales revenue (ongoing revenue)
Partnership revenue: Corporate partnerships and licensing agreements

Expenditure Allocation:

Total treasury income: 100%
  ├─ 40% → Grant program (ecosystem development support)
  ├─ 30% → Marketing and growth (user acquisition, partnerships)
  ├─ 20% → R&D (protocol improvement, new technology research)
  └─ 10% → Emergency reserves (network crisis response)

Governance:

Treasury expenditures are determined through $SELA token holder voting. All proposals are published on-chain, with voting results and expenditure details transparently recorded.

Community Fund

The Community allocation of 30,000,000 SELA (3% of total supply) supports community-driven initiatives:

Early adopter rewards
Referral program bonuses
Bug bounty programs
Open-source contribution rewards
Community events and initiatives
Points-to-token conversion

Points Program

Sela Points (User Points)

Concept:

Sela Points is an off-chain point system earned through API usage, community participation, and network contributions. Points are convertible to $SELA tokens upon meeting certain conditions.

Earning Methods:

API usage: Points accrual per request
Early adopter bonus: Multiplier bonuses for initial users
Referral: Points awarded to both referrer and referee
Community contribution: Bug reports, documentation contributions, educational content creation

Utilization Methods:

$SELA token exchange: Conversion to tokens upon point accumulation
API discounts: Fee discounts when using points
Premium features: Access to advanced analysis tools and priority support
Marketplace purchases: Point usage for parser and script purchases

$SPWR vs Sela Points

Key Differences:

Feature	$SPWR (Sela Power Points)	Sela Points
Target Audience	Node operators	All users (developers, end users)
Earning Method	Node operation, request processing	API usage, community activities
Governance Rights	Yes (voting power)	No
Token Conversion	Yes (to $SELA)	Yes (to $SELA)
Primary Purpose	Infrastructure contribution rewards	User engagement and loyalty

Relationship:

Both point systems contribute to the Sela Network ecosystem but serve different participant groups. $SPWR focuses on infrastructure providers (node operators), while Sela Points rewards platform users and community members. Both systems enable conversion to $SELA tokens, creating a unified value proposition across all network participants.

Getting Started

Node Operator Participation

Requirements:

Minimum 100 SELA staking (varies by tier)
Recommended hardware: Dual-core CPU, 8GB RAM, 128GB SSD, 10 Mbps network
Browser extension or standalone node software installation

Startup Procedure:

Create Sela Network account and complete KYC
Connect wallet and deposit minimum staking amount
Install and configure node software
Begin network participation and request processing

Developer Participation

Requirements:

Developer account creation
SDK and API documentation familiarity
Parser or script development capability

Startup Procedure:

Create account on developer portal
Download SDK and configure local development environment
Develop and test parser or script
Register on marketplace and begin sales

User Participation

Requirements:

Email or social account
API usage purpose and expected usage volume

Startup Procedure:

Sign up on Sela Network website
Issue API key
Begin API calls and point accrual
Exchange points for tokens or utilize discount benefits

Reward Calculation Examples

Node Operator Revenue Projection

Silver Node (S-tier Performance):

Staking: 500 SELA
Monthly requests processed: 5,000
Average fee per request: 0.02 SELA
Performance tier: S (98% uptime, excellent response time)

Monthly projected revenue:
  Base network rewards: 50 SELA
  API fees: 5,000 × 0.02 × 0.7 = 70 SELA
  Performance bonus: 50 × 0.30 = 15 SELA
  Total revenue: 135 SELA

Operating costs:
  Electricity: $5/month (home PC)
  Internet: $0 (existing internet usage)
  Total cost: $5/month

Net revenue: 135 SELA - $5 equivalent
Monthly yield: 27% (assuming stable token price)

Developer Revenue Projection

Popular Parser Creator:

Parser price: 30 SELA
Monthly sales: 15 units
Developer revenue ratio: 70%

Monthly revenue:
  Sales revenue: 15 × 30 × 0.7 = 315 SELA

Additional revenue (optional):
  Grant program: 500 SELA (one-time)
  Bug bounty: 100 SELA (upon vulnerability discovery)

Total revenue: 315 SELA (recurring) + 600 SELA (non-recurring)

Disclaimer:

All figures are examples and do not guarantee actual returns. Actual rewards vary based on network usage, token market price, competing node count, performance tier, and other factors. Cryptocurrency investment is high-risk with possibility of principal loss.

FAQ

Q: When are rewards received?

A: Varies by reward type. API fees accumulate in real-time and are automatically paid upon reaching threshold. Base network rewards are distributed per epoch, and performance bonuses are distributed weekly.

Q: What is the minimum staking amount?

A: Bronze Node requires 100 SELA, Silver Node 500 SELA, Gold Node 2,000 SELA, Platinum Node 10,000 SELA, and Diamond Node 50,000 SELA.

Q: Can revenue be predicted?

A: Network usage and token price fluctuate based on market demand, making accurate prediction difficult. Past returns do not guarantee future returns.

Q: What is the slashing risk level?

A: Slashing risk is very low when operating nodes honestly and adhering to recommended specifications. Most slashing results from intentional malicious behavior or critical errors such as running identical validator keys on multiple nodes.

Q: How are taxes handled?

A: Tax treatment of cryptocurrency rewards varies by country. Verify local tax laws and consult tax professionals as needed. Sela Network does not provide tax advice.

Q: What is $SPWR and how do I earn it?

A: $SPWR (Sela Power Points) is a points system for node operators that tracks contributions to network infrastructure. You earn $SPWR through:

Operating your node continuously (base points per hour)
Processing web access requests (points per request)
Maintaining high performance (bonus points for uptime and response time)
Contributing to underserved geographic regions (distribution bonuses)

$SPWR can be used for governance voting and converted to $SELA tokens.

Q: How do I convert $SPWR to $SELA?

A: $SPWR conversion to $SELA occurs during periodic conversion windows. The conversion rate is dynamic and based on network economics. You can choose between:

Immediate conversion at the current rate
Vested conversion with a bonus (typically 20% additional) over a 12-month period

Minimum $SPWR balance requirements apply. Check the conversion dashboard for current rates and windows.

Q: Can I use $SPWR for governance voting?

A: Yes. $SPWR points grant governance voting rights proportional to your holdings. You can vote on protocol upgrades, treasury expenditures, network policies, and development roadmap priorities.

Q: What’s the difference between $SPWR and Sela Points?

A: $SPWR is specifically for node operators who contribute infrastructure (browser nodes and request processing). Sela Points are for all users (developers, end users) who use the API or participate in community activities. Both can be converted to $SELA, but only $SPWR provides governance voting rights.

Disclaimer:

All figures and examples in this document are for illustrative purposes and do not guarantee actual rewards. Cryptocurrency investment is high-risk with possibility of principal loss. Conduct thorough research and risk assessment before investing.