Swan Chain Universal Basic Income (UBI) Mechanism: A Comprehensive Guide
TL;DR
Swan Chain introduces an innovative Universal Basic Income (UBI) system for Computing Providers (CPs), combining steady baseline income with market-driven compensation—the inaugural UBI-0 phase launches on October 29, 2024, with a 1.2M Swan token reward pool.
Introduction
In the evolving landscape of decentralized computing, Swan Chain is pioneering a groundbreaking approach to provider incentivization. The Universal Basic Income (UBI) system represents a bold step forward in ensuring sustainable network growth while maintaining fair token distribution.
How Does CP Income Work?
The Swan Chain economic model centers on two complementary income streams:
- Universal Basic Income (UBI): A predictable baseline income that supports CPs during periods of resource underutilization
- Paid Jobs: Market-driven compensation for actual computational tasks requested by users
This hybrid approach creates a sustainable ecosystem where providers can rely on steady income during network growth while capturing the full value of their resources as market demand increases.
The Mathematics Behind It
The total daily income for Computing Providers is expressed through the formula:
I(x) = A·xᴮ·e⁻ᶜˣ·(1-u(x)) + Pmarket(x)·u(x)This equation combines two revenue streams:
Paid Job Income Pmarket(x)·u(x)
- Represents earnings from user-requested tasks
- Calculated based on market rates and resource utilization
- Typically exceeds UBI during active network usage
- For FCPs, it includes a 20% bonus multiplier
UBI Income A·xᴮ·e⁻ᶜˣ·(1-u(x))
- Provides baseline protection during low utilization periods
- Automatically adjusts based on network activity
- Serves as a safety net rather than a primary income
Resource Usage Rate u(x) The network's resource utilization rate, calculated as u(x) = T_day / T_total, plays a crucial role in balancing UBI and paid job income. During the UBI-0 phase, this rate updates in real time, reflecting current network conditions and directly influencing provider compensation.
Read more about the formula here: Swan Chain UBI Compensation Model.
UBI-0: The Inaugural Phase
The inaugural UBI program, CP UBI-0, represents a significant milestone in Swan Chain’s development:
- Duration: October 29, 2024 ~ November 29, 2024 (EST)
- Reward Pool: 1,200,000 Swan tokens
- Eligible Participants: Both Edge Computing Providers (ECPs) and Fog Computing Providers (FCPs)
Participation Requirements
The Swan Chain network welcomes two types of Computing Providers, each with specific roles and responsibilities:
Edge Computing Providers (ECPs)
As an ECP, you will:
- Deploy and maintain nodes according to our comprehensive official documentation
- Participate in daily Zero-Knowledge (ZK) validation tasks to ensure network integrity
- Soon engage in mining operations (upcoming feature)
- Maintain required collateral levels while meeting network performance standards
Important Update: We’ve significantly optimized operational costs for ECPs. ZK proof submissions now only require 0.0000005 ETH per proof — a 95% reduction from previous rates, making participation more cost-effective.
Fog Computing Providers (FCPs)
As an FCP, your responsibilities include:
- Following our streamlined FCP-specific deployment instructions
- Executing daily sampling tasks for network health verification
- Managing diverse application deployment requests
- Maintaining collateral requirements while ensuring consistent performance
Participation Process
Getting started with Swan Chain is straightforward and user-friendly. Here’s your path to become a Computing Provider and join UBI-0:
Token Acquisition:
SWANU Token: Contract (0x39cBBeaF88a91404618d45a16e0977Adab4d1Af1) — Used for UBI-0 collateral and platform payments.
- Existing Providers: For CP accounts created during the previous campaign, corresponding SWANU collateral (matched to GPU specifications) will be automatically deposited into escrow accounts before UBI-0 starts. Please upgrade to Computing Provider v0.7.0 and use the
computing-provider infocommand to check your status. - New Computing Providers & Regular Users: Request SWANU tokens through our official application form
Set Up CP:
- Deploy Computing Providers
- FCP setup documentation: https://docs.swanchain.io/bulders/computing-provider/fog-computing-provider-fcp
- ECP setup documentation: https://docs.swanchain.io/bulders/computing-provider/edge-computing-provider-ecp/ecp-setup
2. Deposit Collateral:
- Visit the Swan Chain provider dashboard(https://provider.swanchain.io/overview ) to deposit your required collateral.
- Review our comprehensive collateral documentation for detailed information
Note: Individual GPU collateral requirements adjust dynamically with network computing power. Our upcoming dashboard features will include trend visualization tools for tracking computing units and base collateral relationships.
3. Start Earning:
Begin earning through our dual-income structure:
- Daily UBI rewards are distributed directly to the CP beneficiary address
- Additional revenue from completed network tasks will also distributed directly to the CP beneficiary address
- Real-time earnings tracking through beneficiary address balance monitoring (upcoming feature)
Reward Structure
Income Components
The reward system combines daily UBI distributions with task-based earnings. Calculation factors include:
- GPU specifications and quantity
- Task completion performance
- Resource availability metrics
- Service quality indicators
Distribution Mechanism
Rewards flow directly to provider beneficiary addresses, with daily settlements reflecting both UBI and task completion earnings. The final campaign rewards consider total accumulated earnings, excluding collateral amounts.
Important: Maintain beneficiary address stability and retain SWANU tokens to ensure accurate reward calculation.
Operational Guidelines
Token Management
SWANU tokens will automatically transfer to the escrow accounts (separate for ECP and FCP). These funds remain locked for UBI qualification and order acceptance.
Anti-Gaming Measures
If a CP tries to manipulate their resources by using SWANU from UBI income to inflate tasks artificially, it won’t increase their earnings. Instead, it will lower the success rate of bench tasks, ultimately reducing the CP’s overall income.
Success Strategies
Providers can maximize earnings by:
- Maintaining consistent resource availability
- Delivering high-quality service
- Prioritizing actual user tasks
- Maintaining strong task completion metrics
- Optimizing resource utilization
Looking Ahead
The Swan Chain UBI system represents more than just a reward mechanism — it’s a foundation for sustainable decentralized computing. By combining steady baseline income with market-driven opportunities, Swan Chain creates an ecosystem where providers can thrive while contributing to the network’s growth.
Ready to become a Computing Provider? Visit Swan Chain’s official documentation to get started.
Follow us for more updates on Swan Chain’s development and opportunities.
About Swan Chain
SwanChain, initiated in 2021, is a full toolset AI blockchain infrastructure accelerating AI adoption. Utilizing OP superchain technology, it pioneers in merging Web3 with AI by providing comprehensive solutions across storage, computing, bandwidth, and payments. By tapping into underutilized computing power across a network of community data centers, its integration facilitates a significant reduction in computing costs by up to 70% while enabling the monetization of dormant computing assets. Through innovative marketplaces for decentralized storage, AI, and Zero-Knowledge proofs, alongside the efficiency of Lagrange for AI model deployment, SwanChain makes AI development seamless and affordable.
Our project is backed by top-tier investors in Web3 including Binance Labs, Protocol Labs, Chainlink Labs, etc., alongside joining forces with Nvidia, Google Web3 Startup Program, Microsoft Startup Program, Chainlink BUILD, and Filecoin Orbit.
Traction:
- 10M user addresses and 1M daily transactions on the Saturn Testnet as of Q1 2024.
- A vibrant community exceeding 100K Discord members.
- Network expansion to 2,000+ computing providers across 100 global cities.
- Over 50K deployments of AI model containers.
Stay connected with us:
Website: https://www.swanchain.io
Twitter: https://twitter.com/swan_chain
Telegram: https://t.me/swan_chain/
Discord: https://discord.gg/swanchain
LinkedIn: https://www.linkedin.com/company/swancloud
