Hardware Providers (HPs)
Last updated
Last updated
Hardware Providers (HPs) are the backbone of the Impossible Cloud Network (ICN), responsible for providing the essential resources—such as storage and compute capacity—that power the network. By supplying these resources, HPs enable Builders and users to access ICN's decentralised cloud services.
HPs are rewarded with ICNT tokens for their contributions. These rewards are designed to incentivise HPs to maintain high performance standards, comply with performance requirements, and commit to the network over the long term by locking collateral. The structure of these rewards also encourages the growth of the network during its initial stages and ensures efficient, high-quality service as the network matures.
Hardware Providers (HPs) must meet specific collateral requirements to contribute their storage and computing power to the ICN. Collateral acts as a security measure, ensuring that HPs remain committed to their obligations and perform their duties reliably. It also protects the network against disruptions caused by poor performance or non-compliance.
Node Collateral: HPs are required to lock collateral based on their expected monthly reward. This collateral must be fully provided to participate in the network, and 100% of HP rewards are diverted until the Node Collateral requirement is fully satisfied. Once fully collateralised, any additional overcollateralisation can be used by HPs to expand their capacity at no extra cost.
Network Collateral: Network Collateral is proportional to the storage capacity offered by the HP and must be provided to support the network’s stability. If Network Collateral falls below the required threshold, rewards are diverted to fill the gap based on specific percentages, depending on the level of undercollateralisation. Overcollateralisation results in increased reward multipliers.
HPs must lock their collateral for an initial period of 36 months, with the option to extend this period. Longer commitment periods result in higher reward multipliers, providing further incentives for HPs to remain committed to the network.
Overcollateralisation: HPs that provide more collateral than required can expand their capacity. Overcollateralisation is a signal of reliability and stability, benefiting both the HP and the network.
Undercollateralisation: If HPs fall below the required collateral threshold, they are considered undercollateralised, and a percentage of their rewards is diverted to meet the collateral requirements until compliance is achieved. Depending on the extent of undercollateralisation, different percentages of rewards are redirected.
Hardware Providers (HPs) must meet Node Collateral and Network Collateral requirements to contribute resources to the Impossible Cloud Network (ICN).
Node Collateral: Ensures the reliability of each hardware node. Collateral must be six times the monthly reward and is locked for at least 36 months. If undercollateralised, 100% of HP rewards are diverted until compliance is restored.
Network Collateral: Calculated as 30% of the total unlocked ICNT supply, based on the node's share of the network's capacity. Collateral can be self-provided or delegated. Rewards are diverted if undercollateralised, though this will not happen in the initial phase
HPs may extend their commitment period in 6-month increments, improving their reward potential.
Overcollateralisation allows HPs to expand their capacity, while undercollateralisation results in reward diversion until requirements are met.
The ICN system allows external delegators to help HPs meet their collateral requirements through a delegation mechanism. This creates a collaborative ecosystem where both HPs and external delegators benefit from network growth.
The ICN system allows external delegators to help HPs meet their collateral requirements through delegation and the ICN link mechanism. This creates a collaborative ecosystem where both HPs and external delegators benefit from network growth.
The ICN Link allows token holders to stake their ICNL tokens in support of Hardware Providers (HPs). In practice, these staked ICNL tokens represent an equivalent amount of locked ICNT (vICNT) under the hood, which serves as the effective collateral. By meeting the collateral requirements on behalf of HPs, stakers help maintain network reliability. In return, they are eligible to receive rewards based on factors such as overall network participation.
Users who do not possess an ICN Link can still delegate collateral by providing their ICNT tokens to HPs. This mechanism parallels the ICNL staking process, allowing ICNT holders to participate in collateral provisioning. Rewards for these delegations are similarly calculated based on the amount delegated.
HPs are rewarded based on their capacity contributions and their level of commitment to the network. The rewards system is designed to encourage high performance, reliable services, and long-term participation.
Reward Types
Utilisation Rewards: HPs earn Utilisation Rewards based on how much of their capacity is used by Builders. These rewards are tied to the Cluster Price, which depends on the capacity booked within a cluster. The more that an HP's capacity is utilised, the higher the rewards they will receive. Utilisation Rewards are self-sustaining and covered by the access contributions provided by Builders.
Capacity Rewards: Capacity Rewards are a time-limited protocol subsidy designed to bootstrap new network regions or hardware classes. Capacity Rewards help HPs earn rewards even during the early stages of network growth when utilisation is low. Over time, these rewards fade out to encourage self-sustainability.
To maintain the integrity of the network, HPs must comply with the key performance thresholds that ensure uptime. When an HP fails to meet these obligations, their collateral—both their own and any delegated collateral—may be subject to slashing.
When Slashing Occurs
Behaviour Violations: If an HP fails to meet service requirements, such as experiencing downtime, the protocol may slash a portion of the HP's locked collateral.
To operate as a Hardware Provider (HP) within the Impossible Cloud Network (ICN), HPs must meet specific technical requirements, including hardware specifications and geographic distribution considerations.
For more detailed information on collateral and how it impacts HP rewards, visit the page.
Delegation carries risks. For more information, visit the page.
For detailed information on HP rewards, see the page.
For more information, visit the.
For full details on these technical requirements, refer to the page, which outlines the necessary hardware and steps to become an HP.
For more information on the network hierarchy and how HPs are organised geographically, visit the page.
