The settlement period, which starts after the Data Request and the settlement_date has been approved, requires users to post Settlement Bonds for all possible outcomes in FLX tokens. The threshold for this bond is of approximate value to the data request cost.
Token holders participating in the settlement will earn settlement rewards if the outcome they posted the bond for is the correct one. Settlement Earnings for any data request is determined by the following formula, where f = floor price set at genesis:
The Settlement Floor Price is not fixed and can be adjusted by the Flux DAO at any point in the future.
Data Request Challenge
Once a proposed outcome has enough FLX staked equal to the SB, the settlement period ends and the Challenge period starts. During this period, any validator can post a Challenge Bond (CB) to dispute the outcome of any settlement by staking to a different outcome. The CB has to be of equal value to the SB.
The security of any data request directly correlates to the duration of its challenge period; the longer the duration, the more robust the challenge can be. This duration is always defined by the Data Request set between a window of 5 minutes and 24 hours. If a data request is more arbitrary or doesn’t have a pool of automated validators actively settling requests, it is expected to have a large challenge period. It is almost important to note that every challenge is, in itself, also challengeable