Ika (IKA)

I declare

I think the lack of validator profitability is one of the biggest risks for Ika. Validators work together to run the network and generate signatures to sign transactions. If validators aren't profitable, they're going to start shutting down, which then reduces the utility of the network as a whole. At the moment, validators earn less than $500/month at the current IKA price. To qualify for the delegation program, operators have to run Ika validator nodes and Sui full nodes on mainnet and testnet on separate servers. Many operators are running servers with Ryzen CPUs (7950X3D or 9950X3D), 2TB NVME, 128GB RAM, which can cost anywhere between $200-$400/month for a single server depending on provider, location, network quality, etc. Multiply that by 4, and operators are looking at $800-$1200/month in server costs. In the short term, this might be okay because most operators (including us) are probably bullish on IKA and see a possibility to become profitable someday. In the medium term (if nothing changes), we're going to start seeing validators shut down their nodes. I think the Ika team should get ahead of this and communicate more deeply with validators.

A few things that could help in the short term:

- Acknowledge that a large validator set isn't 100% crucial at this stage. Reduce the number of validators which directly reduces IKA sell pressure. Scale up validator count again as adoption increases.
- Make it clear it's okay to run mainnet and testnet validator nodes on the same server. This immediately cuts monthly costs in half and honestly is not an issue with the current level of activity. Our mainnet node has never used more than 5/32 CPU threads, and NVME disks have plenty of buffer.
- Relax the full node requirement and allow multiple validators to use a shared Sui full node. This is another way to reduce costs significantly.