Investing in Shardeum
With the staggering success of Ethereum and their mission to bring smart contracts on chain, Layer 1 competitors have come along in an attempt to solve some of Ethereum’s greatest challenges.
The trilemma is the idea that any one blockchain must only choose 2 of the following features to maximize: security, scalability, and decentralization. Ethererum’s move to proof of stake has allowed them to further increase scalability as it sacrifices security and decentralization in small ways. However there is still a long way to go.
The Ethereum Virtual Machine has been instrumental in bringing new blockchains to the table to help with congestion of the Ethereum network, while developers and users alike fight for blockspace on the OG chain. By creating an EVM-compatible version of their blockchain, developers can tap into the vast network of Ethereum developers and dApps, taking advantage of its existing infrastructure and resources. An up and coming Layer 1 blockchain called Shardeum has done exactly this, and today I want to detail why I’m bullish on their team.
Disclaimer: I have invested in a Shardeum private sale, and own a small percent of the token supply.
Shardeum is an EVM-based, linearly scalable smart contract platform that provides low gas fees forever while maintaining true decentralization and solid security through dynamic state sharding.
Let’s break that down.
Every node that joins the Shardeum network immediately increases the transactions per second (TPS) and total capacity of the network to achieve linear scaling and ensure low transaction fees even as the usage grows.
How do they make this happen?
Nodes on Shardeum are assigned dynamic address ranges across multiple shards. Since the consensus takes place at the transaction level, the network will retain parallel and atomic processing of transactions resulting in immediate finality/very low latency.
Although it can be categorized with other state sharding platforms like Harmony, Elrond and Near, it has some unique features that set it apart from the rest. While most platforms group transactions into blocks and apply consensus at the block level, Shardeum does consensus on each transaction separately. This allows a transaction that affects multiple shards to be processed simultaneously by these shards rather than consecutively as with block level consensus. This not only reduces the time to process the transaction even if it affects multiple shards, but also ensures atomic processing. Transaction level consensus eliminates the complexities needed to ensure atomic processing which otherwise are needed by block level consensus platforms.
This all sounds great, but there are a few things about Shardeum that made me excited to support the team beyond their main value propisition. So let’s talk about them.
Current decentralized L1's are expensive due to low scalability. Mass adoption is impossible with high fees and low scalability. Emerging markets like India, Africa etc are highly price sensitive so Shardeum’s low fees and high scalability ensures everyone can participate.
The Shardeum founding team has done an incredible job of bootstrapping their community in India, and they have already organically gathered massive support. India loves crypto, and they will definitely support the first Layer 1 to come from the region. It doesn’t hurt that one of Shardeum’s co-founders Nischal Shetty is an established crypto veteran well known in India for founding WazirX, one of India’s largest crypto exchanges. Bullish.
Shardeum is one of the largest Testnet communities in the world with over 400K users and 30K+ smart contracts deployed. Shardeum has been able to accomplish this by focusing on growing the community by bringing in new users to Blockchain. It’s about growing the size of the pie for Shardeum. Initiatives such as their Proof Of Community event being held across India every month are helping achieve this. Shardeum plans to scale these IRL meet-ups globally. And they have just started experimenting these meet-ups in Nigeria as well.
With such a passionate and engaged community, Shardeum has set their chain up for success. By mainnet, there will be 1280 active nodes and I can only assume there are thousands of users lining up for an opportunity to run one. Shardeum has made it very easy for anyone to run nodes. The node hardware requirement will also be minimal, in fact it might be one of the lowest hardware requirement for running validator nodes due to the Sharding technology.
You put all this together, and you have an EVM compatible blockchain that increases decentralization and scalability as more node operators join the ecosystem. Shardeum is building an inclusive ecosystem that appeals to emerging markets. A strategy that I think will pay off quite well as these markets adopt crypto at faster rates than the western world.
Shardeum will have their public sale, TGE, and mainnet in Q2 2023, so keep an eye out for them as they continue to grow. There’s another horse in the Layer 1 race that you shouldn’t ignore.
