Karpenter is definitely a natural fit for Oxide. There's some interesting boundaries that we're discussing internally, like @sudomateo mentioned. One of which is CAPI. There's a CAPI Karpenter provider that elmiko built (notably back in the very early days of Karpenter). I think there's room for both use-cases. Some may want to use CAPI for everything and others may want a platform that is based on CAPI but guest clusters are not.

One implementation specific detail which makes Karpenter interesting on Oxide is the tunable CPU and memory parameters rather than strict instance type shapes. The prototype I built for Karpenter on Oxide generates all possible "instance type" combinations, so you can create some really specific nodes to bin-pack pods.

Another interesting area is multiple providers. This is becoming pretty common across public clouds too. A multi-provider Karpenter is something I'm interested in and I know some folks have already been gluing together, but the Karpenter story isn't great on maintaining those since you basically need to compile them together today. CAPIs multi-provider story is a bit cleaner since it only relies on CRDs.

If you have ideas, let's chat in the Kubernetes slack #karpenter-dev.