After successfully migrating to Laozi testnet #1 with our validator community and re-visiting how our Band Standard Dataset has rapidly grown, it is time for us to look more into what is ahead for BandChain Phase 2: Laozi and what significant developments this journey will bring for enterprises, institutional-grade data providers, validators on Band Protocol.
Our mission at Band Protocol is to help advance the blockchain community with reliable data that is trustless, scalable, fair, and secure to use. We understand our role as a decentralized oracle provider — a pillar of DeFi — in emerging verticals such as cross-chain solutions and strive to innovate to meet the industry’s needs.
This article will discuss three major features in BandChain Phase 2 and the new use cases that opened up through Band Protocol.
- Streaming Revenue Feature for Data Providers
- Cross-Chain Feature: Inter-Blockchain Communication Protocol (IBC protocol)
- Throughput Optimization (8x Increase in Requests Per Block)
Streaming Revenue Feature for Data Providers
- This feature allows data providers and different data sources to collect fees in real-time as their data is being requested on BandChain.
- When a user requests data from a data provider (eg. CoinMarketCap), the user’s payment for that request goes directly to CoinMarketCap’s BAND wallet on BandChain in real-time. The data provider can then withdraw this earning anytime to convert to another digital asset, stable coin, or fiat.
- With this new feature, the data providers can edit the data source code on BandChain, giving them full control over their earnings and the data they are monetizing.
- Data providers can also check for Proof-of-Payment on BandChain to make sure that each validator request comes from Band Protocol and that it is valid before releasing the data. This prevents validators from independently requesting data from the data provider without payment.
Potential Use Cases:
As the first oracle platform to offer the streaming revenue directly to data source providers, we are excited to see how this will help advance DeFi and the industry itself. Here are some impactful use cases that can happen with this feature:
DEXes as Data Providers (With fees for users)
DApps that collect certain data, eg. DEXes, NFT platforms, and lending platforms can easily provide data on BandChain to automatically earn fees, and distribute those fees to pay back its liquidity provider or other stakeholders. This enables on-chain data such as trading volume, historical data, and other market data to be aggregated for consumption.
As a user, you can imagine providing liquidity on your favorite decentralized exchange to receive both the trading fees, liquidity mining rewards (if applicable), and a portion of price data fees generated on BandChain from DeFi DApps.
Hybrid DApps can join too
Hybrid and blockchain applications are empowered to become a marketplace for a variety of different data types. Private browsers like BRAVE can serve data to BandChain to give users more options to further help monetize their data and enhance BRAVE itself to support an extensive amount of use cases.
Traditional Data Source’s Entry Point
Traditional data sources and enterprises can monetize their data solutions with low barriers to entry. Entrance to the world of decentralized applications is unlocked through Band Protocol where institutions can come in to commercialize their data permissionless-ly, hassle-free, and earn their revenue in real-time on a per-call and subscription basis.
Rich Data Ecosystem
BandChain Phase 2 unlocks the ability for any data providers on the open internet to participate. This creates a rich ecosystem with more data types, sources, as well as more robust and accurate data feeds for the end consumers.
Cross-Chain Feature: Inter-Blockchain Communication Protocol (IBC protocol)
The reality of cross-chain is here and we are proud to be the first oracle to provide secure data infrastructure to this future through our implementation of the IBC protocol. The IBC Protocol in BandChain Phase 2 increases interoperability between different chains both within and outside the Cosmos ecosystem. This means any dApps implementing the IBC standard will be able to:
- natively request data from BandChain without the need for any extra on-chain data validation logic
- spend significantly less development time to integrate Band oracle the application
- while still enjoying the integrity and security that the data they receive is truly from BandChain — a time-tested, decentralized data oracle.
Potential Use Cases
1. Many chains, including some of our current partners, are looking to implement the IBC protocol in the near future, including Terra, Injective Labs, Secret Network, Polkadot Ecosystem, Thorchain. This enhances the strongest value propositions of Band Protocol for all our partners — a more native control over the oracle data request process, and a simple way to manage their oracle request payment.
2. For the multitude of existing and upcoming projects adopting the IBC standard, they can integrate and request data from Band Protocol easily without concerns regarding the extraneous infrastructure of validating the integrity of Band oracle results. This allows them to cut down development time and have access to quality data with minimal setup steps.
Throughput Optimization (8x Increase in Requests Per block)
Since the launch of Guanyu (Phase 1), we have seen an increase in our BandChain usage to the current total of 4.5M requests last month. To accommodate increased usage, we have improved the performance of BandChain Phase 2 in the Laozi upgrade through the following ways:
- Execute Oracle Script 10–15x times faster. We upgraded our chain to be compatible with Wasmer V.1 and implement caching of the compiled product. This allows BandChain to execute oracle scripts 10–15x times faster.
- Support 8x more requests. With this faster execution, BandChain can expand its capacity to accept 8x more requests in one block while keeping the same block time (3 seconds per block) to continue support for rapid and accurate oracle updates as adoption grows.
- Dynamic Oracle Script Gas = More Efficient Usage of Gas & Block Space
- To further improve the efficiency of the block space, the users can now adjust how much gas they want to spend per request and their requests will be executed until the gas limit is exhausted.
- This dynamic gas will allow each request’s gas usage to be tailored to its computation needs as opposed to paying one fixed price for all request sizes. The request with less computation can use less gas, therefore, the block space (capped by gas limit) can be more efficiently utilized.
- More Data, More Frequently. More requests mean BandChain can support more price pairs or data at the same time, and also more frequently. This allows our users to get data closer to real-time for more data types.
BandChain Phase 2: Laozi brings with it the technical ability for Band Protocol to be a crucial force in building a sustainable DeFi ecosystem and cross-chain future. We will be seeing through the success of Laozi Mainnet launch in the coming months and also bringing our use cases to fruition with various new partners from DeFi, traditional institutions, and data providers.
Please join our journey and the conversation in one of our community channels below. See you on Laozi!
(We are hiring!)
About Band Protocol
Band Protocol is a cross-chain data oracle platform that aggregates and connects real-world data and APIs to smart contracts. Band Protocol enables smart contract applications such as DeFi, prediction markets, and games to be built on-chain without relying on the single point of failure of a centralized oracle. Band Protocol is backed by a strong network of stakeholders including Sequoia Capital, one of the top venture capital firms in the world, and the leading cryptocurrency exchange, Binance.