ISCSI uses CHAP authentication, as shown in the example VMware iSCSI Initiator setup below.  After setting an iSCSI User Name and Password in the iSCSI Target, you then use the same credentials in the CHAP authentication for the iSCSI initiator, as we see here.

 

 

In the VMware ESXi example below, we see there are several iSCSI datastores.

 

 

The following shows a fully configured iSCSI Software Adapter in VMware ESXi.

 

 

 

 

And below we see the corresponding iSCSI LUN Targets configuration on the SoftNAS server side.  Note you can use different user names and passwords for each target.  In this example, there are no IP restrictions for the allowed initiators (any initiator is allowed to connect).  You can restrict the range of initiator IP's allowed to connect, in addition to requiring user name and password.