Reward Details for Fizz Nodes

To understand the rewarding system for Fizz nodes, let's first understand how reward emission works in the Spheron Protocol.

Reward Emission

Fizz nodes are incentivized with liveness rewards based on the resources they contribute to the network. This approach encourages participation and helps cover operational expenses (OpEx).

• The liveness rewards are currently issued in Spheron Points until the launch of the $SPHN token. These points are non-transferable.
• The liveness reward is issued every ERA (which is 24 hours) and will be accumulated in the Fizz node's wallet.

Liveness rewards are determined based on the following factors:

Resource Rewards

Fizz earns rewards based on the GPU and compute resources it provides to the network. The higher the quality of the resource, the better the reward multiplier. Different resource categories will be introduced, each with different base rewards and multipliers based on tiering (e.g., CPU tiering). Currently, only GPU tiering with 10 tiers has been introduced.

How are resource rewards calculated?

Let's say you have x units of GPU A, which falls in Medium Tier 1 with a multiplier of 1x, and y units of GPU B, which falls in High Tier 2 with a multiplier of 6x. The base reward for GPU Tier is k. The resource reward calculation will be:

(x * 1 + y * 6) * k

Uptime Requirement

Unlike provider nodes, Fizz nodes do not have a trust tiering system. The network assumes Fizz nodes are less reliable and suitable for specific use cases that don't require highly stable systems. However, there is still a minimum uptime requirement to receive rewards:

• Fizz nodes must maintain at least 50% uptime within an ERA to receive rewards.
• If a Fizz node's uptime falls below 50% in an ERA, their rewards for that ERA will be slashed (i.e., they will receive no rewards).

How Uptime is Calculated

Uptime for Fizz nodes is calculated using a simple hourly challenge system:

• Every hour, at a random time, the network checks if the Fizz node is live and operational.
• If the node responds successfully to the challenge, it passes the liveness check for that hour.
• If the node fails to respond, the liveness check for that hour fails.
• There are 24 challenges in total for each ERA (24-hour period).
• If a Fizz node fails 12 or more challenges in an ERA (50% or more), its rewards for that ERA will be slashed.

This system ensures that Fizz nodes are incentivized to maintain a reasonable level of availability without the stricter requirements placed on provider nodes.

Reward Calculation

The reward for Fizz nodes is calculated based on two main factors:

1. Resource Contribution: The amount and quality of resources (e.g., GPU, CPU, storage) contributed to the network.
2. Uptime: Whether the node maintained at least 50% uptime during the ERA.

The final reward for an ERA is calculated as follows:

ERA Reward = Resource Reward * Uptime Factor

Where:
- Resource Reward is calculated based on the contributed resources
- Uptime Factor is 1 if uptime ≥ 50%, or 0 if uptime < 50%

Direct Earnings from Users

In addition to the liveness rewards, Fizz node operators can earn directly from users who lease their compute resources, providing an additional revenue stream for node operators.

How Direct Earnings Work

1. User Leasing: When a user leases compute resources from your Fizz node using your client, they pay fees based on the pricing you set during the setup.

2. Immediate Earnings: These earnings are credited to your account immediately after the lease is completed.

3. Withdrawal: You can withdraw your earnings at any time from your dashboard.

Fee Structure

While you receive the majority of the earnings from user leases, there are some fees associated with each transaction:

• Foundation Fee: 5% of the earnings goes to the Spheron Foundation
• Provider Fee: 5% of the earning goes to the provider

This means that as a Fizz node operator, you receive 90% of the total amount paid by the user for leasing your compute resources.

By Offering competitive pricing and maintaining good resource availability can maximize your direct earnings from user leases and the liveness rewards.