What Do You Earn For Delegating GRT To An Indexer, Do We Get Rewards

What Do You Earn For Delegating GRT To An Indexer, Do We Get Rewards

Over time, there has been an increase in indexing over the period of time. Indexers are none other than the operators who are functional in the Graph Network. The Graph Network deals in the Graph Network [‘GRT’].

The indexers stake these GRT tokens in order to earn an indexing reward. The indexer usually extracts the data and processes it to form a database. The data is then processed into a predefined scheme which may be referred to as indexing. 

Indexers usually earn rewards with the staked GRT for a given period of time. The graphs and subgraphs are usually ranked in the order of priority and added to the arrangement of data. The lesser important ones are delegated.

But these indexers continue earning a share of the delegated stake from these delegators as well as they happen to be part of the same network. This data is regularly processed and prioritised and indexers earn rewards through this delegation

 The Extent Of Earning Through Delegation

When the GRT is put at stake by the indexers and delegated further by the delegators, every trader can expect a return of 7% for every 10,000 GRT collected.

 The Extent Of Earning Through Delegation

This 7% is usually collected in the form of processing fees and rewards. Let us understand the relevance of these terms one by one.


The network comprises participants who are indexers. These indexers delegate the GRT to other indexers known as delegators. This process of delegation enables an indexer to earn fees.

This fee is basically channelled between the indexers/delegators and the gateways. The gateway sends the request to the indexer and the indexer in return responds to the same. 

This is how the payment for processing queries is generated.  The more the amount delegated, the more would be the processing fee, and the more would the indexer earn. The cost of every processing decides the valuation of stakes and delegations. Every delegation is validated at the end of the delegator. This helps to prevent misrepresentation in the process of staking.

Indexing Rewards

The indexers deploy graphs in the network. They delegate some of the data too. The distribution of data across the network is subjected to the market forces of demand and supply.

Usually, a 3-5% of annual return is generated at the end of the protocol. These rewards are distributed among the indexers and delegators in proportion to their holdings and deployments. 


The indexers are subjected to a cut-rate as well. This cut rate is the amount deducted in the proportion of GRT put on stake and delegated. The stake ratio between the indexer and the delegator decides the commission fee and the cut-rate. This cut-rate usually burns the earned rewards and reduces them to a great extent.

How Are The Rewards And Fees Earned In Graph Networks Through Delegation?

Once the GRTs are delegated to the indexers, they are given the right to index the former indexer’s GRT. Delegation is an important decision as it can determine the final rewards earned by the indexer and the delegator.

The sequencing of the data files forms a pattern which is put on a stake for earning rewards. These rewards are calculated with the help of Cobbs Douglas formula. They are proportionately distributed across the nodes and a minimum of 0.5% of the fee is earned by every delegator for executing these functions on the network.

How Are The Rewards And Fees Earned In Graph Networks Through Delegation?

The graphs and other patterns of data are arranged regularly and this is how they enter into transactions. Every transaction is able to generate a fee which is then assigned to the participating indexers.

If the sequencing is executed in a more professional and rewarding manner, then that indexer would be enjoying the fruits of more rewards over time. The indexers who stake and further delegate the GRT are awarded a percentile of rewards and the fees that flow from delegated GRT. 

ALSO READ : What Is Staking In Crypto: All You Need To Know About Crypto Staking

The final performance of an indexer is the ultimate deciding criterion to calculate the total of the rewards generated. This is usually between 6-15% on average.

The annual return will continue throwing benefits among the indexers and the chain of delegators which functions ahead. The earned rewards are credited to the index address of the indexers which can be further used to purchase GRT and then stake them for earning a higher degree of rewards. 

What Are The Implications Of Such Delegation Of GRT?

Delegation might be a good idea to earn processing fees and rewards, however, with time, there has been an increase in the multiple allocations of the GRT at the instance of the same indexer and delegator.

This has created a fake inflationary bubble that has ended up increasing the price of the GRT in circulation. The proportion of the available supply has also been altered due to which each indexer now receives larger rewards as the number of GRT with them has considerably increased post this hike. 

What Are The Implications Of Such Delegation Of GRT?

The rewards earned pursuant to delegation are inflationary rewards. These rewards may be lost if the indexers indulge in malpractices and fraud.

A single decision of delegation to the indexer who is processing stakes on multiple platforms can not only expose the rewards to diversified risks but also allocate the allotted graphs in a wrong sequence thereby reducing the future possibility of earning rewards. 

What Is The Maximum Delegation Capacity For Every Indexer?

Each indexer happens to delegate 16 GRT to another indexer. Any indexer who stores around 100 more GRT on the nodal network can receive rewards up to 1,600,000.

Thus the maximum capacity to delegate is limited, the indexer cannot benefit much even when the pool of GRT is large.  It controls the dilution of the indexer’s stake in GRT and ensures that malpractices are avoided. 


This can be concluded that GRT offers an adequate opportunity to earn rewards from the process of delegation. But the process must be monitored actively and regularly in order to prevent fraud.

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