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Block Green opportunities stream daily rewards to liquidity providers. These rewards are distributed from the miner's pool to the SynHash pool's reward vault. Below, we describe the sequence of actions that take place to ensure a smooth distribution of rewards to our liquidity providers (LPs).
Each day, the miner sends rewards to the BG reward vault via its own mining pool account.
BG monitors the amount of rewards delivered to the vault. This constant tracking ensures that the miners fulfill their obligations and that the LPs receive their returns in accordance with the purchased hashrate.
If the miner delivers sufficient rewards, BG distributes these to the LPs according to their purchased hashrate. Each LP receives their fair share of the rewards based on the amount of purchased hashrate.
In case the miner under-delivers on the agreed-upon rewards, BG immediately liquidates an appropriate portion of the miner's collateral posted in the on-chain collateral vault. This immediate action ensures that the LPs are not affected by any shortfalls in the miner's delivery.
If the collateral in the vault goes below the required ratio (as set out in the agreement), a margin call is activated. The miner must then provide more collateral to continue participating in the protocol and avoid complete liquidation.