Regardless of the long bear market, I keep watching situation surrounding BTC and blockchain industry in general. There is a project that caught a lot of my attention in 2018. I can easily say, that I have spent way much more time and energy researching this project than I have spent on my diploma thesis at uni. It’s called HPB and I’d like to share some ideas of information with you guys.
Disclaimer: I’m not paid nor I have any connection to the team. It is the largest part of my crypto-portfolio and I will now share with you why. I’ll try to stay as objective as possible and provide relevant information.
So lets begin, 100+ hours of my research in 20minutes of reading. Enjoy.
HIGH PERFORMANCE BLOCKCHAIN (HPB)
THE PROBLEM AND THE SOLUTION
HPB is a smart contract platform like Ethereum for example. I have often found it as a “Chinese EOS” comparison, although I personally think that those projects are vastly different. As you probably know, there is a scalability issue plaguing the whole blockchain industry and preventing mainstream adoption. Different projects take different paths to solve this problem. Some, like EOS for example, take a path of decreasing number of nodes that have to reach consensus, therefore they are able to process more TPS with low latency. Others, like Ziliqa, want to use sharding, which basically means dividing the ledger into many smaller parts (shards) whereas each shard keeps only part of the ledger.
HPB is taking very unique approach to tackle blockchain performance bottleneck. They have created their own dedicated hardware — called Blockchain Offload Engine (BOE) — to increase TPS capacity of the network. They simply believe that software + dedicated firmware and hardware created for this very purpose will be better than just software itself. This is in my opinion very logical step when you look at what hardware did to other industries (like graphic cards to gaming industry or ASIC miners to BTC mining) and could be a real breakthrough. BOE should make the network not only more scalable but also more secure because you’d need to overcome not only software part, but also BOE, which has in-build hardware random number generator.
HPB is primarily aiming at big companies that process huge amount of data and require big throughput, like financial industry, healthcare, IOT, supply chains or gaming industry.
It is quite impressive that HPB attracted dapps from other, higher evaluated, blockchains even before launching their mainnet. Namely Osasis football from ETH, Prophet from GXchain and gaming industry company Lightsecond from Aurora blockchain.
Very interesting feature of HPB is a creation of GVM (general virtual machine), which is currently being developed for NEO and ETH (and others to follow). I’m not technically proficient to explain how exactly VM works, but basically the thing is that HPB can through VM and customized API provide part of their performance to ETH or NEO (and later other blockchains as well) to process transactions. When you think about it, this is a great solution for those who already have their dapps at an advanced or final stage on another blockchain — ETH for example -and require large TPS that ETH cannot handle, but they do not want to rewrite the entire code and migrate to another faster blockchain. In order for the dapp from another blockchain to take advantage of HPB performance, it will need to buy a certain amount of HPB tokens. Hence, HPB does not stand firmly in competition with other platforms for dapps, but instead, they want to help and provide part of their performance through VM if necessary. If someone can explain better how VM works, it will be great if you throw it into your comments.
They also explore the possibilities of engaging in anti-counterfeiting traceability and are working on their own supply chain dapp solution, but there is no more information about this at the moment.
In April, the first phase of the testnet took place where HPB was able to process 30,000vps / 10,000tps even without optimized BOE hardware.
CONSENSUS ALGORYTHM AND NODE SYSTEM
Initially, it was meant to be PoS + delegated PoW algorythm, but the team eventually decided to go another way, the way of dedicated Proof of Authority (dPoA). I will provide link at the end of this text so you can find out more about it, but in a nutshell, PoA is practically PoS, except that nodes are associated with identity of the owner. This greatly reduces a possibility that some of the nodes will act against the best interests of the entire network because it has its own reputation at stake.
The HPB node system will be two-tiered — High performance node and candidate node light nodes. The number of nodes will start this year at 150 with 31 HP nodes. In 2019 there will be 150 more nodes addend into the network. Further increase of nodes will be decided by community. Compared to EOS this is very decentralized system. HP nodes are responsible for sychronization and generation of blocks, meanwhile Candidate nodes will be processing transactions. Algorythm will rotate nodes and each Candidate node can be elected as HP node.
The rewards for nodes are as followed: 2/3 will be devided between HP node that generated a new block and candidate nodes. 35% goes to HP node and 65% will be equally devided between candidate nodes. 1/3 will be devided between all nodes according to the ammount of votes they got.
The key factors to be elected as HP nodes are: BOE hardware, the ammount of HPB coins, internet speed, network bandwidth, number of being elected in the past etc.
HPB foundation will keep 6% of nodes. 24% of nodes are for invitations only (generally for big enterprises that want to be part of HPB and create their dapps, acadamic institutions, developers, non profit organizations etc.) and 70% nodes are elected. Elections take place every three months and invitations every 6 months.
Timeline — closed mainnet was launched at the end of august. Distribution of BOE units to node runners is taking place and photos of happy BOE owners are appearing in telegram group. September 10th is a wallet release, September 13th token swap to HPB native coin starts (Okex and bibox are already confirmed to support the swap), 14th-20th September the first election phase takes place, September 24th, the public mainnet goes live.
THE TEAM AND PARTNERSHIPS
The CEO of the project is Xiaoming Wang — a highly respected person in China blockchain community. He is a pioneer of blockchain technology and has been lecturing in Asia for years about benefits of blockchain. Besides his reputation, he had undoubtedly gained many contacts in the industry. He also wrote several books on blockchain, such as “Blockchain developer guide” and “Ethereum” (both in Chinese only). He is also co-founder of UnionPay Smart.
Additionally, among the team and advisory we can find a member Nobel Prize winning team member, Executive President of UnionPay Smart, Bibox Exchange founder and co-founder of OKCoin, CEO of Bixin btc pool, GDEX founder and other interesting people.
The first partner, and one of the angel investors at the same time, is NEO (although HPB is currently an ERC20 token, because during ICO time NEO did not have its own ICOs.) NEO is most likely interested in using HPB VM to accelerate its performance. CEO of NEO and HPB are said to be close friends.
And now the big one — HPB has a partnership with UnionPay Smart. UnionPay is essentially China’s VISA or MasterCard, but it is larger than both of these companies combined and it handles more than 80% of all China’s transactions. I have found no confirmation on the part of UnionPay, but they did not deny it either, which I’m quite confident company like UnionPay would do if it wasn’t true. I found that UnionPay is partially a state-owned company and nobody can just put UnionPay logo on their website and say that they are partners. On July 1st, BOE launch event took place, where among others CTO from UnionPay Smart was speaking and he called HPB „the most pragmatic Chinese blockchain“. Assuming this partnership is a real deal, HPB will have no problem getting more strong partnerships.
Here, I have to say that UnionPay Smart is not UnionPay itself. It is a company founded by UnionPay which processes all their big data. In this regard I would like to mention partnership of HPB and Banyam Network (BBN) — currently ERC20, however, after HPB launches its mainnet they plan to migrate and be one of the dapps running on HPB. I will not go into details about BBN, I will just say that it is a dapp for sorting and processing big data, and their CEO is the founder of UnionPay Smart. What a coincidence.
Other partners include CPC chain (Chinese IOT), Pchain, Bottos or SSSchain. Not long ago HPB announced that they have received about 20 000ETH (about 10m dollars at that time) as a strategic investment from several different investors leading by OK capital (OKEX), Bixin, BlockWater Capitol (one of the biggest Korean cryptofunds) and more. I will provide a link with the list of investors at the end of this text.
What also makes HPB very legit project is that they became members of SME Finance Forum of IFC, World bank. This is quite a big deal in my opinion and I had to dig in a little bit to actually believe it and I’ve really found HPB on members list under Zhaoxi, which is a legal entity that HPB falls under. After this, my last concern that HPB might be a scam has just disappeared. This membership could potentially open doors to many new partnerships and co-operations with other members of the forum.
HPB also cooperates with several universities and some of them are going to run their own node. HPB also supports new blockchain developers and offers scholarships via Udacity nanodegree blockchain program.This clearly shows that HPB has a long vision.
Every project has some, and so does HPB. For example the roadmap is not very sophisticated, and for the rest of the year it has practically only one milestone after starting the mainnet — launching a collaboration product with UnionPay smart and work with other partners. Also website would deserve full remake because when you’re clicking through it opens another tabs, which is quite annoying. These two issues should be done very soon though according to tg admins. Some criticise their open source hardware with fears that it will be adjusted by competition and will be better than HPB. However, HPB’s hardware and software components are said to be tied so strongly that it’s almost impossible to do. Even if someone has done it, HPB is in the first player position and will be miles ahead by that time.
One red flag is that mainnet was delayed twice already. First, it should had gone live end of June, then end of August, and now September 24th. Personally, I don’t mind the fact that it was postponed twice that much. It was postponed due to hardware units debugging etc, which I totally understand. The hardware has to be shipped with no bugs and errors as fixing it later would be much more complicated than just fixing the software part. What I do mind is that it was in both cases delayed at the last minute, just few days before planned launch.
Also bounty program was mostly fail and perhaps has done more harm than good with the flood of shitty articles, but that’s just my opinion.
PLANS AND FUTURE OF HPB
I have been gathering information about HPB and following their telegram on almost daily basis since February/March, and HPB team has been again and again be criticized for very poor marketing and that there is no hype around HPB. The answer to this criticism was basically always the same — “We do not have a working product that we can promote yet. Our goal is not to create hype. Our goal is to create a high quality product. When it’s done, we’ll start marketing.” I personally like this approach much more than generating hype with big promises and announcements about future announcements etc like TRX or XVG and others.
I need to say that during last weeks I can see HPB moving forwards in terms of activity. They hired new people into the team to support marketing to the West as well as community managers to manage telegram group and I can already see big improvement in the communication there. I really value lots of hard work of former community admins, but I like this step towards professionalism.
Potential of HPB is huge because it can not only host zero-fee dapps on its own blockchain, but thanks to it’s General VirtualMachine it can also help other blockchains increase their performance. Anti counterfeiting traceability or supply chain dapps are great usage of blockchain technology and using blockchain in gaming industry is also very interesting.
All-in-all, HPB is very ambitious project with great team and partnerships. If the testnet was able to process 30,000vps / 10,000tps without optimized hardware, we can expect at least same or higher numbers with optimized hardware as their mainnet goes live. The chances are fairly high that HPB will soon become (please correct me if I’m wrong) the fastest running blockchain in the world. If we compare the marketcap of HPB (35m) with their main “high performance blockchain” competitor EOS (5bn), HPB would have to grow 120x to get where EOS is. Does that mean that HPB will make 120x gains? Of course not. However, there is a lots of potential here. If projects such as TRX, EOS or ADA (not slandering, just saying) have achieved bilions of dollars marketcap without any working product at all, HPB can get there with working product, better marketing and some more exchange listings too, especially if we see another crypto bull. If BTC does not ruin the party, following weeks and months will be very exciting for HPB.
There are some interesting speculations around HPB too. For example with NEX (NeonExchange), which will be a decentralised exchange based on NEO blockchain. Their whitepaper mentions that the NEX off-chain matching engine will use “high performance hardware”. Of course, this may be a completely different hardware, but HPB‘s both hardware and software are open source, NEO is HPB investor and probably wants to take advantage of HPB performance via Virtual Machine, NEX runs on NEO and will need a large amount of TPS as a decentralised exchange and HPB can deliver just that. A similar situation is with Bibox (currently the about 10th largest exchange by volume) which is said to have intentions to switch to a decentralised system in future. The founder of Bibox is one of HPB’s investors and consultants. Even CEO of Binance mentioned in some speech that Binance would like to switch to decentralised exchange, but they need at least 40k TPS to do it. He said as soon as someone gets to this number of TPS, they will get in talks. The same comes for OKEX in light of their recent investment into HPB.
None of the above is confirmed at the moment, it‘s all just pure speculations, but it clearly shows that crypto market is in need of some high performance blockchain.
- Poor marketing so far
- Bounty didn’t work well imho
- Mainnet delayed twice
- Chinese project (less info for non Chinese speaking investors)
- Missing incentive for smaller holders (no staking or airdrops)
- There are many smart contract platforms to compete with
+ the first ever hardware + software architecture blockchain
+ not listed on big exchanges yet
+ haven’t started proper marketing yet
+ the idea of hardware + software is better than software itself should be fairly easy to market, many people will get it
+ big partnerships (NEO, UnionPay, SME Finance forum membership)
+the team can (and will) be upgrading not only software part HPB (like sharding etc in future if needed) but also hardware part, which will be huge advantage
+ many programming languages
+ General Virtual Machine to support other blockchains
The team is trying to create something that has never been done before. Which can be little risky but highly rewarding as well. Blockchain industry is in need of high performance blockchain if this technology is ever going to go mainstream, and High Performance Blockchain (HPB) has absolutely unique approach to solve this need and considering what the team aims to achieve, their marketcap is ridiculously low at the moment and mainnet just around the corner . And that’s why HPB is my biggest bag of all.
Thank you for reading, feel free to add your comments and thoughts. If you like this article, please give it some claps and share with your friends.
This article does not represent financial advice and I don’t consider myself as an expert in this area. It is just a summary of information I found and my own personal opinions about HPB.
https://medium.com/@miketribe86/hpb-vs-eos-a-quick-over-view-510f58973e8 — EOS and HPB comparison
https://medium.com/@miketribe86/high-performance-blockchain-hpb-core-chain-a-list-of-partnerships-b275ef44e6a2 — list of investors into HPB