- Author(s): @mawdegroot, @Maxgold91
- Start Date: 2023-04-07
- Category: economic Economic
- Original HIP PR: #606
- Tracking Issue:
This HIP proposes to set a minimum onboarding fee for devices in the subDAO structure. This HIP also proposes that devices for which the minimum onboarding fee has not been burned are not eligible for rewards from the subDAO. The minimum onboarding fee will be dynamically defined as $10 on August 1, 2023 and will follow the same halving schedule as HNT emissions as shown in the chart below. It is important to note, this HIP only defines a minimum fee and at the time of its writing, HIPs 51-53 have defined the onboarding fees as $40 per hotspot. If a subDAO wishes to change its onboard fees, it must do so through the subDAO governance process. This HIP will be implemented in phases, first clearly defining the requirements at the time of its passing, then on-chain with a target date of August 1, 2023.
| Date | Minimum Onboard Fee in DC |
|---|---|
| 08/01/2023 | 1,000,000 |
| 08/01/2025 | 500,000 |
| 08/01/2027 | 250,000 |
| 08/01/2029 | 125,000 |
| 08/01/2031 | 62,500 |
| 08/01/2033 | 31,250 |
| 08/01/2035 | 15,625 |
The HIP authors fully support any community initiative to set a floor price to stop the halving at a future date. However, it is our opinion that the current halving schedule gives the network about 8-10 years to figure out which figure works best. The halving schedule was chosen to be in line with the theory of Moore's Law and roughly correlate to the CAPEX required for these networks. If these features, in the future, are no longer relevant, the Helium DAO should update the minimum onboard price to be in line with future economic forces.
A minimum onboarding fee is necessary to:
- Stop subDAOs from arbitrarily onboarding Hotspots.
- Prevent nuisance attacks against subDAOs and the Helium DAO.
HIP51 has described the onboarding of Hotspots but has not made this explicit. Hotspots for which the minimum onboarding fee has not been burnt are not eligible for rewards. SubDAOs attempting to bypass this requirement will be subject to slashing.
All network participants.
The onboarding fees protect the network against nuisance attacks as well as making other attacks against the network less viable. Industrialized gaming is made less viable by the onboarding fees as well as giving the opportunity to catch gaming before a net-positive result is achieved by the gamer. The
The Helium flywheel is based on creating DC burn. Onboarding fees have historically been the most influential driving force of DC burn. The
The original DAO Utility Score handles dead subDAOs gracefully. Given the unlikely scenario that a subDAO ceases operation the
This proposal seeks to retain the DAO Utility Score as it was specified in HIP51 and is a competing proposal for HIP80. While HIP80 seeks to 'simplify' the DAO Utility Score and remedy the missing MOBILE onboarding fees by a significant overhaul, this proposal seeks to keep the original DAO Utility Score and solve the problem at the source: require subDAOs to burn onboarding fees.
where
Retaining the
The DAO Utility Score will use the onboarding fee that has been burned for a specific device. E.g. if a device is active and has burned a $40 onboarding fee the DNP Device Activation Fee will be $40 and if a device is active and has burned a $20 onboarding fee the DNP Device Activation Fee will be $20.
Due to technical limitations of the network architecture, and the complexities of the engineering required, during the proposal of this Helium Improvement Proposal (HIP), as well as the timing of the Solana migration, this HIP hereby sets a compliance deadline of August 1, 2023, for subDAOs that are non-compliant. This grace period affords subDAOs the opportunity to operate as if the burn occurred on April 17, 2023 (prior to the migration). However, it necessitates a retroactive burn to reconcile any outstanding onboarding debts in a manner consistent with the previous IOT retroactive burn.
For purposes of determining the MOBILE subDAO's
HIP51 defines active devices as "Active devices are the subDAO's definition of devices creating valid coverage (aka Hotspots) and therefore being rewarded during the epoch". This definition will implicitly prevent devices that have not been onboarded to be credited towards the DAO Utility Score as the unonboarded devices are not allowed to be rewarded for anything other than data transfer. This includes, but is not limited to, Proof-of-Coverage rewards, pre-mine rewards, challenge construction rewards, and any other rewards that are not directly related to data transfer. Devices onboarded at the time of the Solana migration that do not meet the minimum outlined in this HIP may still be credited towards the DAO Utility Score based on the DC burn to onboard them (data only LoRaWAN hotspots).
We believe any incremental additions to hotspots that materially increase its price and materially increases its ability to mine more of a subDAO’s DNT constitutes a new device that must be onboarded. However, Helium DAO will give the subDAOs the freedom to reasonably decide what it considers to be a device. It is the position of Helium DAO that, while we encourage ECC chips and other similar security measures for devices, it is not a requirement and leave that distinction up to the subDAO. We also feel it is not necessary for a device to live on-chain if a subDAO feels it can effectively count and reward devices using off-chain oracles. SubDAOs that choose to maintain their device list and Proof-of-Coverage architecture in off-chain oracles agree to reasonable periodic audits at the Helium DAOs request.
For example, an antenna on a LoRaWAN hotspot, which does not guarantee any additional rewards, would not need to be onboarded. Whereas, a MOBILE radio which requires a material increase in CAPEX over a gateway and directly relates to an increase in rewards should be onboarded.
This HIP sets forth the definition of active devices as those that have been onboarded by a subDAO and rewarded for Proof-of-Coverage (or any other similar non-data transfer activity) within the preceding 30 days (or 30 epochs, as per a Solana epoch). In the event that a subDAO implements a 'deny list' or any other exclusionary measure, any device subject to such measure shall no longer be deemed active from the time it has its earning capability revoked.
This HIP does explicitly not prescribe subDAOs which entity is required to burn the onboarding fee. Historically, the onboarding fee has been burned by the manufacturer but each subDAO can, through governance, decide which entity burns the onboarding fee.
This HIP explicitly defines that devices are not required to onboard to every subDAO the hardware is capable of. The hotspots that are active before the Solana migration are considered to be onboarded on the IOT subDAO and will need to be onboarded on other subDAOs to be eligible for rewards, except during the grace period outlined above.
This proposal requires Hotspots that did not pay a minimum onboarding fee to burn the onboarding fee retroactively to continue earning rewards. While inconvenient, there is sufficient precedent as this situation has happened before with CalChip.
The migration to Solana requires every Hotspot to be onboarded to every subDAO individually, as HIP51 intended. Existing Hotspots for which no onboarding fee has been burnt to a specific subDAO will have to rectify this to continue earning rewards for a subDAO.
To be implemented at the time of the Solana Migration on April 18th as part of the ongoing smart contract and subDAO work by the Helium Foundation. Full implentation will take place on or around August 1, 2023.
None
This is successful if the onboarding fees provide Sybil resistance for the subDAOs and perform the minimum requirements for the network to launch on Solana.