How to Break Through the Last Iteration of the Public Chain Industry
Summary of CMO Joined BIGGERCHAIN 2019 China’s blockchain leaders Forum
At the BIGGERCHAIN 2019 China’s blockchain leaders Forum, which held on July 6, QuarkChain CMO Anthurine gave an excellent speech about how public blockchain will evolve in the future. When Libra’s implementation was challenged, how will the blockchain industry develop in the future? QuarkChain offers some solutions. Here’s the whole speech:
Public Chains have already Excess Capacity?
Today, I’d like to share my opinions about public blockchains. Some people claim that there are too many public blockchains in the market. How to keep catch up with the modern trend? I believe this is the most important issue.
Let’s talk about Bitcoin, its value has increased by 75 times than before. As is mentioned before, more and more major corporations such as Facebook have adopted blockchain technology. While these companies may have not launched their cryptocurrencies yet, it has already made blockchain technology more and more popular among the public.
At the same time, more and more platforms and DAPPs, have stepped into the field of blockchain. What kind of challenges is blockchain facing? Last year, the keyword is scalability, to be more precise, the speed of blockchain is too slow. Almost all the public chains including QuarkChain were focusing on how to make blockchain faster. Sharing technology is used to solve the scalability problem. Last October, our peak TPS has reached 50,000+ TPS and it’s far more beyond nowadays. However, there are no DApp projects which need such a high TPS yet. In other words, a blockchain with thousands of TPS is enough for now.
TPS was Past, Then what is the future?
If TPS is no longer an issue, what should we pay attention to? I believe there are four factors that we need to consider. They are
1. Community split
2. Hashpower dilution
3. Upgrade difficulty
4. Single function.
Most of us may still remember the BCH forks occurred last year. It resulted in a plunge of 30% for Bitcoin and we were influenced as holders.
Why did BCH fork? Besides the political and personal factors, the most important reason is that BCH wanted to add a smart contract-ABC. BCH wanted to build a platform with multiple functions just like ETH, where DApp could be built and developed. On the other hand, BCHSV preferred a “bitcoin model”, using a P2P transaction without adding a smart contract. The only way for two technical ideas to work on the same platform is to fork, so they forked.
What was the result? Hashpower dilution. It made 51% attack easier and leads to community split. BCH’S community was spilled into two parts. One part supports ABC while the other supports SV. It’s not the first fork and it definitely will not be the last one. Maybe in the future, either BCHABC or SV will continue to fork. Every time it forks, it results in community split. The community becomes smaller and smaller cause everyone is in favor of different technology core or something else. At the same time, it will lead to the hashpower dilution, which makes the 51% attack easier.
What’s the meaning of “Upgrade Difficulty”? It’s the community split and hashpower dilution I was talking about. ETH was considering to transform from POW to POS, it looks simple but in fact, it is extremely difficult. All the blockchains’ infrastructures were unmodifiable. When you chose POS, it’s POS forever.
For example, if I chose POS as my consensus, I cannot change the infrastructure. If there is a better consensus next year, transforming to it is extremely difficult.
All in all, whenever you choose a consensus or a VM, it’s hard to change. The biggest contribution of Libra is that it created a new VM. Before that, ETH’s VM was used by everyone until Libra claims that its MOVE’s VM is better than ETH’s. For those who have already adopted ETH’s VM, it’s difficult to change to MOVE’s. For every public blockchain, when you choose your infrastructure, it’s hard to change.
What is a “single function”? Take ETH for an example, its native token is ERC20 and TRON token is TRC20. What does 20 mean here? It means it’s not the native token. If I use ERC20 to make a payment through the smart contract, it is complicated and several steps are needed. If I make a transaction on ETH, it’s quite simple by using a smart contract. However, if a new token ERC20 was launched, the transaction could be quite difficult.
For all four points, Quarkchain has come up with our own solution, which is flexibility. Every public blockchain, like ETH, NEO, EOS, and ADA, could be defined with four factors: consensus mechanism, ledger model, transaction model, and token economy. They are like a permutation and combination. Take ETH for an example, its VM is EVM and its consensus is PoW. If ETH wants to use PoS, its ledger is not fit for Coinbase which is UTSO. The data is different. As for token economics, ETH is using mining. Whenever a transaction is made, ETH will be used to make a payment. Token economic of EOS is different, it adopted the CPU model.
These may sound extremely technical to you. But remember, all the platforms and public blockchains could be defined by these four factors, and it is unmodifiable. When you chose PoW, it’s extremely difficult to change from PoW to PoS. There is no exception except for QuarkChain.
QuarkChain is using state sharding technology. What is state sharding? It’s like solving a traffic jam. If there is only one lane on the highway, no matter how fast the speed is, there is no improvement. What’s a better way to solve the problem? That is to build more lanes so that cars can go through at the same time. That’s exactly the logic of state sharding in terms of blockchains.
Beyond this, QuarkChain has proposed a new solution. While the rest of the project which uses sharding technologies could just “build” the same highways. Which means, if it’s EVM, it remains EVM, if it’s POW, it remains POW. However, the state sharding technology which QuarkChain adopted is different, it makes it possible to build different kinds of highways.
For example, the first state sharding uses EVM and PoW consensus just like ETH, the second uses DPOS — a different consensus like EOS. The third one uses SVM or Libra’s VM and the fouth uses PoS. In my opinion, the development of consensus mechanisms is still going on. People used to talk about PoW in the past, DPoS was the popular one last year and PoS is the topic this year. I’m quite sure new consensus mechanisms will come out in the future.
Every time a new consensus mechanism comes out, QuarkChain could be adopted. One of the speakers today mentioned that we don’t need so many public chains in the future. It could be ETH, BTC or another new public blockchain to take place in the future. But how do we define “new”? What is new this year may turn out to be old next year. What should we do at that time? To build a new chain or to pace the trend? QuarkChain aims to support all the new technologies.
Currently, we support POS and POW. You can choose whatever you like. We are now cooperating with many companies and customizing solutions for them. Each company has totally different needs. Some prefer inflationary consensus while others prefer deflationary consensus. Solutions should be customized by their favors.
I believe flexibility is the future for public blockchains. With flexibility, you could always renew your technology and remain to be a “forever new” public blockchain.
Finally, thanks to everyone’s attention. QuakChain’s team is based in Silicon Valley. In the future, we will take part in more domestic activities so that we can communicate with you more often.