How saturation affects delegators rewards & SPO pledge rewards

[Mr_Anderson]

I have questions about about pool saturation and rewards.

1. Say someone delegated 1M ADA when a pool wasn’t saturated, and they averaged 5.5% return per year. But then LATER, the pool became saturated. Does this mean this person’s rewards are diminished? OR does the reduced rewards only affect NEW delegators?

2. When a pool becomes saturated and delegators have reduced rewards, how are the reduced rewards calculated? (I’d like to do some calculations)

3. If a pool is saturated and delegators get reduced rewards, and the stake pool operator has a large pledge, does the stake pool operator get diminished rewards too? (because if this is the case, it’s an incentive to have a smaller pledge once your pool is saturated).

[Markus-VITAL]

@Mr_Anderson

Say someone delegated 1M ADA when a pool wasn’t saturated, and they averaged 5.5% return per year. But then LATER, the pool became saturated. Does this mean this person’s rewards are diminished? OR does the reduced rewards only affect NEW delegators?

The active Stake of the according epoch is what matters. If the pools runs over the saturation level everything which is over the saturation level will not generate additional rewards and hurts all delegators linearly / according to their active stake.

@Mr_Anderson

When a pool becomes saturated and delegators have reduced rewards, how are the reduced rewards calculated? (I’d like to do some calculations)

Im not 100% sure about it but I think it’s linear. So if there is e.g. 70m active stake at a 64m saturation point then roughly 9.5% could be earned additionally. Meaning everyone will get accordingly less rewards.

@Mr_Anderson

If a pool is saturated and delegators get reduced rewards, and the stake pool operator has a large pledge, does the stake pool operator get diminished rewards too? (because if this is the case, it’s an incentive to have a smaller pledge once your pool is saturated).

In terms of rewards pledge is handled like stake.