Revolutionary DePIN staking on Fluence: An investor’s guide
The cloud computing space is dominated by centralized giants like AWS, Google Cloud, and Azure, but Fluence is breaking the mold with a decentralized, enterprise-grade alternative. Offering a cost-efficient and open compute platform, Fluence eliminates the need for proprietary cloud providers, providing businesses with enhanced flexibility and resilience.
Fluence has onboarded customers which it has saved over $2 million compared to the centralized cloud, rewarded compute providers with over $1million in ARR (in USDC and FLT) and has a pipeline of 90 companies comprising $7.5mm in ARR. This early traction bodes very well for the growth of Fluence and shows the potential for the platform to be a significant player in the critical compute ecosystem by providing a viable alternative to the centralized clouds.
By shaping the Cloudless future, Fluence leverages DePIN (Decentralized Physical Infrastructure Networks) to offer affordable, high-performance compute solutions. As these solutions scale, the platform offers attractive opportunity for investors to earn yield by securing the network.
Fluence’s innovative staking and reward system is designed to attract institutional compute providers with predictable returns in exchange for their hardware contributions. Simultaneously, it appeals to individual and institutional investors who can stake its native token, FLT, to help secure the platform and earn rewards.
In this guide, we’ll explore Fluence staking, why it presents an attractive opportunity for investors, and what sets it apart from typical staking models.
The Fluence Platform: A Decentralized Compute Marketplace
Fluence is a decentralized marketplace that connects businesses requiring enterprise-grade computing power with professional infrastructure providers such as PiKNiK, Nebula,and Kabat, all of which operate from top-tier (Tier IV) data centers.
In stark contrast to centralized giants like AWS, Google Cloud, and Azure, Fluence’s open network offers significant cost savings, often up to 75% cheaper. Fluence’s infrastructure runs on the same Tier IV data centers used by leading Web2 businesses, ensuring a high level of reliability. Its lower cost provides a viable alternative to traditional cloud providers, reducing the risks of rising costs, censorship, and inefficient cross-platform data sharing.
“Fluence has architected its platform to enable a large, low cost and resilient network. To be successful, the platform requires an economic model that provides trust and attracts institutional providers who look for stable returns. Resources provided to the network should be easily discoverable, provably accounted, efficiently utilized, and fairly compensated, and customers should receive high quality and predicable service at a significantly lower price than comparable cloud platforms. The network should be resistant to misbehavior and dishonest actors, ensuring they are penalized for incomplete work.” – The Fluence DAO
Key Components of the Fluence Platform
- Compute Providers
Fluence’s decentralized compute marketplace features providers that commit their hardware resources for rent. Providers earn FLT tokens when their hardware proves availability and USDC their hardware is rented by customers. - Proof of Capacity (PoC) Mechanism
Fluence ensures providers meet their commitments through a Proof of Capacity (PoC) system. Compute capacity is measured in Compute Units (CUs), which consist of 1 core, 4GB RAM. This mechanism ensures transparency and provable capacity dedicated to the network. - Continuous Readiness and Rewards
Providers submit cryptographic proofs to the Fluence blockchain to demonstrate their capacity and readiness. They receive FLT rewards for idle CUs every epoch, which is currently set as a 24-hour period. In order to be able to participate in the reward protocol, FLT stake is required to activate the providers’ capacity. - Stakers
Stakers collateralize FLT tokens to activate compute providers’ capacity, ensuring network reliability. In return, stakers earn FLT rewards or USDC for helping to secure and decentralize Fluence’s platform. The Fluence protocol allows and supports delegated staking including liquidity pools. - Customers
Customers rent compute services using stablecoins (USDC), making transactions predictable for themselves as well as providers by reducing the volatility typically encountered in cryptocurrency-based systems.
Staking with Fluence
Unlike most compute networks, which require the compute provider to stake tokens, Fluence enables delegated staking that allows any FLT holder to stake and secure the network. Furthermore, it allows innovative projects, like Parasial, to offer capital efficient liquid staking pools. Fluence believes that institutional hardware providers prefer to focus on hardware operation rather than managing tokens, while the universe of investors seeking yield is much larger. By allowing any FLT holder to stake, Fluence lowers costs for compute providers and encourages community and institutional participation.
The Fluence staking model is unique in that it is based on a fixed USD value, not an arbitrary number of tokens. This fixed value ensures that the stake is adequate to build trust while maintaining predictable regardless of bull or bear markets.
Rewards are paid in FLT, but are adjusted daily to target $10 per core, or $600 per month for a 64-core CPU. When a customer rents capacity, payments are made in USDC rather than FLT.
| Stake per 64-core CPU | $12,000 |
| Annual reward for staker (assuming 20% reward share) | $1,440 |
| Stake yield | 12% USD-based |
From Staking To Compute Rentals
Investors stake FLT to activate provider hardware and ensure that the network operates reliably. Hence, staking aligns compute providers with customers. If a provider fails to deliver on its commitments, they forfeit revenue, lose unvested rewards and risk having the (delegated) stake slashed.
With FLT staked to activate hardware committed to the network, providers create and submit proofs to confirm compute unit availability, forming an on-chain Capacity Commitment listed on the Compute Marketplace. Now, customers can browse the marketplace, publish their compute requirements and negotiate a price.
Once a match aligning a customer’s requirements with a provider’s capabilities is made, a smart contract, aka a deal, is created and funded by the customer. In order to make the contracted compute available to the customer, the contracted compute capacity transitions from proving its availability to serving the customers workload.
Providers and stakers continue earning for the duration of the deal.
While deal revenue is paid out to compute providers and to stakers upon the completion of the contract, staking rewards for proving capacity are vested over six months, with 1/182 of the rewards unlocked each day to encourage long-term participation.
For more information on Fluence staking mechanisms, including reward calculations and claiming rewards, consult the FLT Staking FAQ blog.
Staker Rewards
Provider rewards target $10 per month per compute unit, or $600 per month for a 64-core CPU (deducting for four cores lost to overhead). These rewards are shared as determined by the provider and published on the marketplace. For example, a provider may propose to reward a staker with 20% of the server income.
In most compute and storage DePIN projects, staking is typically limited to hardware providers, leaving little opportunity for the broader community and investors to actively participate.
Fluence, however, takes a different approach with delegated staking enabling full community participation. This not only allows investors to engage directly but also enhances the security and reliability of the platform’s compute marketplace. It also enables third party projects to innovate and create solutions on top of the underlying mechanics which should drive more use for FLT and exchange staking capital efficiency.
Furthering its commitment to community participation, Fluence governance is managed by the Fluence DAO, a Swiss-based association designed to give token holders real decision-making power while protecting participants from legal liability.
Through on-chain voting, the DAO allows the community to propose and approve governance changes. Additionally, the DAO elects a Governance Committee to safeguard the integrity of the process, ensuring decisions are made transparently and fairly, free from the risk of malicious or rogue voting.
Why Stake with Fluence? An Investor’s Perspective
Institutional investors are increasingly seeking innovative, reliable opportunities in decentralized infrastructure. Fluence’s staking model checks all the boxes:
- Predictable USD-Denominated Rewards: FLT rewards are adjusted daily to maintain the USD-equivalent value of around $10 per core per month.
- Institutional-Grade Security and Trust: Each compute job is secured through proofs, replacing reliance on centralized providers with verifiable, on-chain guarantees. Slashing mechanisms penalize non-performance, ensuring reliability.
- Sustainable Growth: Rewards are vested over six months, ensuring long-term engagement from providers and stakers alike.
How to begin staking
To begin staking, head to the Fluence staking app, where you can track and manage your staked positions, monitor the status of Capacity Commitments and withdraw FLT rewards.
For those who might find the typical staking requirements (between $6,000 to $12,000 in FLT) prohibitive, Fluence has partnered with Parasail, a leading DePIN staking solution, to offer smaller investors an easier entry point by providing liquid staking pools, with more innovative pools to come. Learn more about liquid staking.
The Future of Fluence and FLT Demand
FLT is the backbone that secures harmony between compute providers and stakers, upholding a staking model designed to drive long-term utility and demand for the token by:
- Locking FLT into staking commitments, reducing circulating supply
- Creating a direct correlation between network expansion and FLT staking requirements
- Encouraging long-term holding through structured reward vesting
- Supporting a stable economic model that avoids inflationary token rewards common in other staking models
The protocol targets $200 of FLT stake per compute unit, meaning that every increase in compute capacity directly drives a proportional rise in FLT staking demand. For context, at launch in March 2024, Fluence had a waitlist of over 600,000 CPU cores, representing a potential $170M in FLT staking demand. However, Fluence is only onboarding capacity in alignment with customer demand, scaling the network as needed. This approach ensures a sustainable token economy, with fresh capital flowing into the ecosystem to access the real-world benefits of compute power.
Furthermore, unlike inflationary staking models, Fluence’s staking mechanism encourages long-term holding through structured reward vesting. This prevents excessive token emissions, ensuring sustained network participation and maintaining long-term stability.
Customers: Third Party Node Provider Sector
Fluenc’s initial customers and pipeline consists of companies in the large and growing third party node provider sector.
The third party node provider sector is comprised of hundreds of companies that provide services to blockchains, to individuals and to enterprise customers that outsource the effort and complexity of running blockchain nodes. Because most of the companies in this sector are private and the service is usually included in the broad category of cloud services, projections of the industry size range significantly from $500 million to $2 billion. Regardless of the current size, it is clear that the industry is growing very quickly with estimates of 30-40% annual growth. Even taking the low end of the market size of $500 million presents a substantial market opportunity for Fluence.
Compute comprises 40-50% of third party node provider’s cost structure which make this industry particularly interested in lower cost compute. A fifty percent savings on compute has a substantial impact on their margins. and as providers adopt Fluence and lower their cost structure, any provider that doesn’t adjust its cost profile will be at a disadvantage. Third party node providers also understand the benefit of decentralization which is a priority for some of their customer base such as blockchains.
We think this sector is a terrific initial customer base that is well suited to adopt the Fluence platform and as customers onboard, Fluence will grow quickly in this substantial market, positioning it to add additional sectors.
A New Era in Decentralized Compute
Fluence is setting the stage for the future of decentralized computing by combining security, accessibility, and innovation. Through its staking model, the platform empowers participants to play an active role in shaping the future of computing—whether by securing resources, earning rewards, or contributing to the broader Web3 ecosystem.
For institutional investors, Fluence offers a stable and predictable opportunity to align with decentralized infrastructure. For individuals, it provides a chance to participate in a movement that’s transforming how computing resources are accessed and used.
As Fluence continues to pioneer advancements in DePIN, its DePIN staking mechanism stands as a beacon of innovation—representing not just an investment in a network but in a vision for a more secure, equitable, and efficient technological future. To participate in securing the most innovative compute DePIN, head to the Fluence dApp; to experience the Fluence Cloudless solution, test-drive a Fluence virtual private server (VPS). To learn about Fluence, visit our website. To stay up to date on all Fluence news, follow Fluence on X and join the community on the Discord and Telegram channels.
This content is sponsored and does not serve as an endorsement by Blockworks. The veracity of this content has not been verified and should not serve as financial advice. We encourage readers to conduct their own research before making financial decisions.
Get the news in your inbox. Explore Blockworks newsletters: