> ## Documentation Index
> Fetch the complete documentation index at: https://docs.phala.com/llms.txt
> Use this file to discover all available pages before exploring further.

> Essential information for becoming a compute provider on Phala Network(ETH L2).

# Introduction

After [Sunsetting Phala Parachain and Migrating to Ethereum L2](https://phala.subsquare.io/democracy/referenda/77), and upgrading the network infrastructure to Intel TDX and GPU Confidential Computing, computing power providers will migrate from the parachain-based environment to the new Ethereum L2 ecosystem. But Phala’s core tokenomics and incentive structure remain largely consistent and predictable.

## 1. Total Supply & High-Level Distribution

Phala maintains a fixed total token supply of:

* **1,000,000,000 PHA (1 billion PHA)**

Out of the total supply, **70% is allocated to mining rewards**. This portion is designed to:

* Incentivize long-term network participation
* Reward resource providers (especially GPU miners)
* Support staking-based security and governance
* Fund ecosystem growth via the treasury

The **70% mining reward pool** is further split into three parts:

| Allocation Target            | Share of Mining Rewards | Description                                               |
| ---------------------------- | ----------------------- | --------------------------------------------------------- |
| **Treasury**                 | 20%                     | Ecosystem, development, and long-term strategic funding   |
| **Ethereum Staking Rewards** | 40%                     | Rewards for PHA staked into the Ethereum staking contract |
| **GPU Miners**               | 40%                     | Rewards for contributing TDX-secured GPU compute          |

## 2. PHA → vPHA: The L2 Native & Governance Token

After the migration to Ethereum and an L2-based architecture, Phala introduced a **staking contract on Ethereum** that allows users to convert: PHA → vPHA

### 2.1 What is vPHA?

**vPHA** is the core token for the **Phala L2 Network**, and is designed to be the primary token used within the L2 ecosystem.

Key roles of **vPHA** include:

* **Governance**\
  Used to participate in community governance and protocol decision-making.

* **GPU Worker Staking**\
  Used as stake/collateral for GPU workers to participate in the mining set.

* **L2 Application Token Use Cases**\
  Intended to be the core token for future GPU-related L2 applications and usage scenarios.

### 2.2 Why Stake PHA into vPHA?

By staking PHA into the Ethereum staking contract and receiving vPHA, users:

* Help secure and govern the Phala L2 ecosystem
* Gain access to **staking rewards** (from the 40% mining reward share allocated to Ethereum staking)
* Obtain the core utility token for future L2 GPU-related use cases

Therefore, the community is **encouraged to convert PHA into vPHA**, and the protocol offers **corresponding PHA staking rewards** to incentivize this behavior.

## 3. GPU Miners: Core of the TDX-Backed GPU Compute Network

**GPU miners** are the backbone of Phala’s future **TDX-secured GPU computing network**.

By contributing GPU resources to the network, miners receive a portion of the mining rewards based primarily on:

* **GPU type** (hardware class and performance)
* **Online time** (availability and stability)

Rewards are essentially a function of **hardware weight × uptime**.

### 3.1 Reward Weights by GPU Type

Different GPU models receive different reward weights to reflect their relative performance and compute value.

Currently supported GPU models and their reward weights:

| GPU Model | Reward Weight |
| --------- | ------------- |
| **H100**  | 1.0           |
| **H200**  | 1.5           |
| **B200**  | 1.8           |

A higher weight implies a higher share of GPU mining rewards, assuming comparable uptime and reliability.

### 3.2 GPU Reward Distribution Mechanism

GPU mining rewards are distributed in the form of **vPHA**.

* Rewards are calculated continuously based on validated GPU uptime and hardware weight.
* **Payouts occur every hour**, with rewards sent at the **end of each hour**.

## 4. vPHA Collateral Requirements for GPU Miners

To ensure the **security and reliability** of GPU compute in the network, Phala requires GPU miners to provide additional **vPHA collateral** for each GPU they operate.

> This collateral is **not** the same as staking into the Ethereum staking contract.\
> It is **non-yield-bearing** and exists purely as a **security guarantee** for GPU compute.

### 4.1 Required vPHA per GPU

The collateral requirements per GPU are:

| GPU Model | Required vPHA Stake per GPU |
| --------- | --------------------------- |
| **H100**  | 1250 vPHA                   |
| **H200**  | 1875 vPHA                   |
| **B200**  | 2250 vPHA                   |

Characteristics of this collateral:

* It does **not** accrue staking rewards or interest.
* It is used strictly as a security mechanism.
* It links the operator’s economic interest to the quality and honesty of the GPU service they provide.

This design improves:

* **Sybil resistance** – prevents low-cost spam or malicious GPU registration
* **Reliability** – encourages miners to maintain high-quality nodes and configurations
* **Accountability** – provides economic basis for punitive or exclusion mechanisms if needed

## 5. Quality Control & Governance Over GPU Capacity

To uphold network reliability, the Phala team will **periodically verify the quality of GPU compute** available in the network.

These verifications may include:

* Performance and benchmark validation
* TDX integrity and security checks
* Uptime and stability metrics
* Other trust and safety standards defined by the protocol and community

If a GPU is found to be **non-compliant** (e.g., underperforming, misconfigured, or malicious), the process is:

1. The issue is documented and shared with the community.
2. Upon announced, the corresponding GPU(s) can be **removed from the mining set**, and associated rewards can be stopped.

This ensures the GPU mining ecosystem remains:

* **Secure**
* **Reliable**
* **Aligned with community standards**