> ## Documentation Index
> Fetch the complete documentation index at: https://docs.superform.xyz/llms.txt
> Use this file to discover all available pages before exploring further.

# Economics

> Validator rewards, staking, slashing, insurance, and rollout phases for the Superform validator network.

<Warning>
  Validator economics are not final yet. Phase 1 is permissioned and does not include the full staking and slashing model described here.
</Warning>

This page covers the validator incentive model and rollout path. For protocol mechanics, use [How It Works](/build/become-a-validator/how-it-works).

## Why validators get paid

Validators provide the PPS updates SuperVaults need to function safely. If updates stop or become dishonest, vault operations degrade quickly. Rewards exist to keep high-quality operators online and aligned with the network.

## Rewards

Vault curators pay upkeep fees in **\$UP** for active oracle coverage. Those fees are distributed to participating validators.

The intended model is:

* more stake increases reward weight
* better participation preserves reward eligibility
* missed rounds reduce your effective payout

Exact thresholds and rates are governance parameters and have not been published yet.

## Staking

Phase 2 is expected to require validators to bond **\$UP**.

That bond is intended to:

* serve as collateral for slashing
* weight participation and rewards
* enforce a minimum commitment to stay active

## Slashing

Slashing is designed to penalize two categories of failure:

* **misreporting** — signing materially incorrect or invalid PPS data
* **insufficient participation** — staying below required uptime / contribution thresholds

Exact slash sizes and observation windows are still pending.

## Insurance fund

A portion of validator economics is expected to seed an insurance fund intended to backstop depositors if oracle failures cause verified harm.

It is not meant to cover:

* unrelated smart contract bugs
* strategy market losses
* immaterial losses below a governance-defined threshold

## Rollout phases

| Phase   | Model                                          | Status  |
| ------- | ---------------------------------------------- | ------- |
| Phase 1 | Permissioned validator set                     | Live    |
| Phase 2 | Open bonding, slashing, insurance fund seeding | Planned |
| Phase 3 | Governance-managed validator rotation          | Planned |

## Practical takeaway for operators

Treat the current program as operationally serious even before the full economic model is live. Phase 1 may be permissioned, but uptime, correctness, and incident response still matter because the vaults depend on your node behaving like production infrastructure.