Smart Contract Rent is the recurring payment required for contracts to remain active on the network. Rent is comprised of auto-renewal and storage payments.
The previous blog post, Smart Contract Rent is Coming to Hedera, outlines why rent is being introduced and how smart contracts can pay rent. This Part 1 of the new blog series explains Hedera's pricing structure and renewal windows for contract rent payments. Read Part 2 for a how-to on making rent payments and avoiding expiration.
Foundational to the conversation about smart contract rent, distributed networks like Hedera have a finite amount of computational resources. When entities like smart contracts are deployed on a decentralized network, a portion of those resources are consumed. Thus, it is unfeasible to maintain an unlimited number of entities for an infinite amount of time on finite resources. Solving this problem is necessary, and it’s a key topic of discussion by Leemon and others in the layer 1 network space.
Rent is an economically and technically viable approach to manage smart contract entities and state storage.
Bottom Line on Top
Rent is the recurring payment required for contracts to remain active on the network. Rent is comprised of auto-renewal and storage payments
Auto-renewal payments for contracts will be enabled on mainnet with the Hedera Services release planned for March, 2023
The auto-renewal fee for a contract is $0.026 USD
- Storage payments on Hedera will start once a total of 100 million key-value pairs are stored cumulatively across the network. These storage fees will be part of the rent payment collected when a contract is auto renewed. Once storage payments start (100M k-v pair threshold):
Each contract has 100 free key-value pairs of storage available
Once a contract exceeds the first 100 free key-value pairs, it must pay storage fees. Valid renewal windows are between ~30 and ~92 days (see HIP-372)
The storage fee rate is $0.02 per key-value pair per year
- If a high enough utilization threshold is reached, congestion pricing applies
In this circumstance, prices charged are inversely proportional to the remaining system capacity of the network (lower remaining capacity means higher pricing)
This applies to all transactions