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Providers in Chromia

Providers are individuals or organizations who contribute computing power to the network. They run nodes, which are high-performance computers that store and process data for Chromia. These nodes act as the backbone of the Chromia blockchain.

System Providers and Node Providers​

There are two different roles that Providers can have that come with varying levels of responsibility:

  1. System Providers: These Providers run nodes in the network's system cluster. They manage the network's core infrastructure by overseeing the smooth operation of the system chains, which form the foundation upon which Chromia operates. System Providers are responsible for voting on crucial proposals that shape the network's future, such as adding new system providers. System Providers can also initiate the creation of new dapp clusters as demand on the network increases.
  2. Node Providers: These Providers contribute by running nodes in dapp clusters, providing infrastructure for dapps deployed by developers to run. While System Providers are allowed to run nodes in both the system cluster and dapp clusters, Node Providers are only allowed to run nodes in dapp clusters. A Node Provider can be promoted into a System Provider through voting among the current System Providers.

Providers in the Chromia network have a significant say in the decision-making process. They vote on various proposals, and a super-majority (greater than ⅔) is required to approve substantial changes to the network.

Providers manage two types of key pairs:

  1. A provider key pair, used to vote on and sign proposals. This key pair is used to identify the provider on the network.
  2. Node key pairs, used to identify each node on the network. All nodes in the network have their unique key pair.

Provider staking​

Providers are required to stake a certain amount of Chroma tokens (CHR). Staking helps align Providers' incentives with the welfare of the network and community. Individual token holders can delegate stake to a Provider to earn a share of their rewards.

Anyone can stake CHR and receive a 10% annual percentage rate (APR) governance reward, which may change in the future. The staking contract is deployed on the Ethereum and Binance Smart Chain (BSC) blockchains, allowing users to interact with it using existing ERC20 wallets, such as MetaMask.

Provider rewards​

Providers receive compensation from a pool of all hosting fees paid by dapps on the network. The compensation a Provider receives is calculated based on several parameters, such as the amount of computing power contributed to the network, node uptime, and provider role (system provider or node provider). A proposal can update the reward calculation formula as the network evolves and the optimal balance of parameters changes. You can read more about the exact formula for provider rewards in the provider section.

Next up​

Next, we'll look at dapp hosting fees in more detail and examine the origins of the tokens used to reward Providers. Hosting fees and provider rewards form the backbone of Chromia's tokenomics model.