# Concepts

Fluence CPU Cloud is a decentralized compute marketplace where you can rent virtual machine instances from enterprise-grade providers worldwide, predominantly in Tier-3 and Tier-4 data centers.

## Marketplace

The marketplace aggregates compute supply from independent providers. The marketplace connects you with providers through several layers:

- **Offer** — a listing from a provider that includes one or more compute peers with identical specifications, located in the same data center, available at a set price.
- **Compute peer** — a physical server referenced in an offer. Each peer has its own hardware resources and is the actual machine that runs your workload.
- **Resource** — a distinct resource on a peer: vCPU, RAM, storage, or public IP.
- **Hardware specification** — metadata describing a resource (CPU architecture, memory generation, storage medium, etc.).

Compute resources are currently allocated in multiples of a **compute unit** — 2 vCPUs and 4 GB of RAM. Storage starts at a minimum of 25 GB.

## Instance lifecycle

Each instance goes through the following statuses during its lifetime:

| Status | Description |
|--------|-------------|
| `New` | Instance is created and is about to be provisioned |
| `Launching` | Instance is being provisioned, no public IP yet |
| `Active` | Instance is running and accessible |
| `SmallBalance` | Not enough funds for the next billing period |
| `InsufficientFunds` | Instance balance is 0 and the grace period passed |
| `Terminated` | Instance was terminated by the provider — workload is no longer running. See [provider termination handling](https://fluence.dev/docs/build/cpu_cloud/manage_vm.md#handling-provider-terminated-instances). |
| `Stopped` | Instance was ended by the user |

## Billing model

CPU Cloud uses daily billing in USD. Each instance has its own 24-hour billing period that starts at activation time and repeats every 24 hours.

### Instance balance

Every instance has its own reserved balance that covers ongoing rent. When you deploy an instance, the system deducts 2 days' worth of rent from your account — one day is charged immediately upon starting the instance, and the other stays as a reserve for the next billing period.

### Automatic top-ups of instance's balance

After each daily charge, the system automatically tops up the reserved balance from your account to maintain one day of reserve.

### Insufficient funds

If your account balance cannot cover a top-up, the system keeps retrying the top-up. Your instance continues running through any period that has already been paid for. Termination happens only when the next charge fails because the reserved balance has been fully spent.

### Refunds on termination

When you stop or terminate an instance, any unused funds on its reserved balance are returned to your account.

## OS images

You can use a pre-defined OS image from Fluence or provide a URL to a custom image. Custom images must be publicly downloadable and configured for remote instances.

Supported formats: `.qcow2`, `.img`, `.raw`, `.raw.xz`, `.raw.gz`, `.img.xz`, `.img.gz`.