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docs: Update reward-distribution.md #994

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19 changes: 17 additions & 2 deletions docs/docs/features/reward-distribution.md
Original file line number Diff line number Diff line change
Expand Up @@ -12,6 +12,21 @@ The distributed reward tokens are IBC tokens and therefore cannot be staked on t

Sending and distributing rewards from consumer chains to provider chain is handled by the `Reward Distribution` sub-protocol.

## Note
The ICS distribution system works by allowing consumer chains to send rewards to a module address on the provider called the `ConsumerRewardsPool`.
There is a new transaction type called `RegisterConsumerRewardDenom`. This transaction allows consumer chains to register denoms to be used as consumer chain rewards on the provider.
It costs `10 ATOM` to register a denom and the full amount is transferred to the community pool of the provider chain. Only denoms registered through this transaction are then transferred to the `FeePoolAddress` and distributed out to delegators and validators.
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### Instructions for adding a denom
The transaction must be carried out on the provider chain. Please use the `ibc/*` denom trace format.
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:::tip
```
# reward denoms must be registered on the provider chain (gaia in this example)
gaiad tx provider register-consumer-reward-denom ibc/3C3D7B3BE4ECC85A0E5B52A3AEC3B7DFC2AA9CA47C37821E57020D6807043BE9 --from mykey
```
:::

## Parameters
:::tip
The following chain parameters dictate consumer chain distribution amount and frequency.
Expand All @@ -21,12 +36,12 @@ They are set at consumer genesis and `blocks_per_distribution_transmission`, `co


### `consumer_redistribution_fraction`
The fraction of tokens sent from consumer to provider during distribution events. The fraction is a string representing a decimal number. For example "0.75" would represent 75%.
The fraction of tokens allocated to the consumer redistribution address during distribution events. The fraction is a string representing a decimal number. For example "0.75" would represent 75%.

:::tip
Example:

With `consumer_redistribution_fraction` set to `0.75` the consumer chain would send 75% of its block rewards and accumulated fees to the consumer chain and the remaining 25% to the provider chain every `n` blocks where `n == blocks_per_distribution_transmission`.
With `consumer_redistribution_fraction` set to `0.75` the consumer chain would send 75% of its block rewards and accumulated fees to the consumer redistribution address, and the remaining 25% to the provider chain fee pool every `n` blocks where `n == blocks_per_distribution_transmission`.
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:::

### `blocks_per_distribution_transmission`
Expand Down