PROVE Tokenomics: Full Analysis of Deflationary Model and Staking Rewards

The $PROVE tokens of #SuccinctLabs are designed with a fixed supply of 1 billion tokens. Through a deflationary mechanism and a staking rewards model, a long-term value capture system is constructed, with the core logic as follows:

1. Deflationary Model

• Token Destruction: Of the proof request fees collected by the network, 1% is allocated to the protocol treasury, which may be used in the future for governance voting to repurchase and destroy $PROVE, thus reducing circulation.

• Staking Forfeiture: Malicious provers or nodes that fail to complete tasks on time will have their staked tokens forfeited, which will be directly destroyed or transferred to the treasury, enhancing scarcity.

2. Staking Reward Mechanism

• Prover Incentives: 95% of the proof fees are distributed to winning provers, and stakers must lock PROVE to participate in bidding, with annualized returns of up to 20%+, attracting computational power investment.

• Delegated Staking: Ordinary holders can delegate their tokens to provers and share 4% of the fee distribution, earning passive income without the need to run hardware.

• Dynamic Issuance: The issuance of new tokens is controlled by governance, initially used to incentivize early participants and gradually reducing the inflation rate to balance supply and demand.

3. Economic Security and Governance

The staking mechanism not only provides returns but also ensures network security—provers must stake at least 1,000 $PROVE (testnet standard), and the high staking threshold deters malicious behavior. Token holders can also adjust key parameters (such as staking rate and destruction ratio) through governance voting to promote sustainable ecological development.

In summary, PROVE achieves a value closed loop in the ZK proof market through the triple design of destruction, staking, and governance, becoming a foundational infrastructure token that combines scarcity and utility. @Succinct