Every epoch, the rewards a pool has earned are split in three steps before anything reaches the delegators, according to the parameters the pool has registered on the blockchain:
- First the fixed cost is taken, a set amount per epoch. The protocol sets a floor for it; ALPS charges 340 ₳, and that is what pays for the servers and funds the donations.
- Then the margin: ALPS takes 2.5 % of what is left.
- The remainder is split among everyone who delegated, in proportion to their stake – the operator's own pledge included.
An example with round numbers: a pool with 10M ₳ of active stake mints 10 blocks in an epoch and earns 10 000 ₳. A fixed cost of 340 ₳ is taken first. A margin of 2.5 % of the remaining 9 660 ₳ is 241.5 ₳. The remaining 9 418.5 ₳ go to the delegators, so 1 000 ₳ of stake earns about 0.94 ₳ that epoch.
How much the fixed cost weighs depends on the size of the pool: on a large pool it is spread over a lot of stake, on a tiny pool it can eat most of a single block's reward.