“Data termination penalty” is a term for replacing the built-in market’s minimum mandatory deal collateral with data assurance penalties enforced by the miner actor instead.

If we assume that mandatory data assurance penalties are something the network should enforce for all data, this change would unblock subsequent changes to:

avoid costs & limitations of the built-in market actor for simple no-payment FIL+ data, and
support user smart contracts as brokers for alternative deal types,

while maintaining the economic behaviour.

However, since this penalty is only 2.7% of the penalty for sector termination, we could instead just decide that mandatory data assurance is not worth the effort/complexity, and leave it up to smart contracts instead.

<aside> 👉 Summary:

Apply data termination penalty in the miner actor
Account for QAP in the data termination penalty formulation
Reduce or remove deal collaterals from the built-in market actor

</aside>

Background

The built-in storage market actor requires a minimum provider collateral for each deal. This is intended to provide a level of assurance/reliability to deal clients, and also has the effect of raising the risks/costs of serving a deal.

Calculated on raw storage, unaffected by FIL+
Burnt (not paid to the client) if a deal is ended early
Locks up some (trivial) amount of tokens for the deal duration, a benefit to holders.
Calculation: CircSupply * 1% * DealSize / max(NetworkRawPower, BaselinePower)

For reference, as of April 2023 for 32GiB:

	Verified	Unverified
Deal collateral	0.0089	0.0089
Initial pledge	2.171	0.2172
DC days of reward	2.4	24
DC / initial pledge	0.4%	4%
Termination fee	0.3331	0.0333
DC / termination fee	2.7%	27%

As a fraction of block rewards or pledge, the minimum deal collateral is thus a 10x cost for unverified vs verified deals. Similarly, deal collateral represents ~1/4 of sector termination penalty for unverified deals, but only ~1/40 for verified deals. Again, this is a 10x penalty for unverified vs verified deals, relative to network incentives.

The total contribution of deal collaterals to locked pledge tokens grows with utilisation, but is always tiny. At 100% sector utilisation with FIL+ deals, total deal collateral would be only 0.33% of total locking (~0.1% of circulating supply). Deal collateral is a trivial contribution to total locking benefits to token holders.

Problems

Two independent problems with this mechanism are:

Assuming that some mandatory network data assurance is appropriate, implementing it in the built-in market actor forces all deals to use that actor (costly) and restricts deals to terms that the built-in market can handle (very limiting).