Cypherium | Libra Comparison
Blockchain technology has rapidly blossomed into one of the most diverse spaces in technology today. Because the space is so new, entrepreneurs and technologists have been able to explore the technology at every vertical layer (be it user-end applications or entirely new protocols) as well as in every horizontal direction (the most promising projects pushing the boundaries of what their role in the space might be. In this richly diverse space, Cypherium has shown itself to be one of the most exceptional new blockchains, on which a wide variety of use cases and applications can be built to solve real-world problems. Its unique solutions to the blockchain trilemma — including a Java virtual machine and a dual chain structure for instant transaction finality — have set the project apart from most third-generation DLTs. From a strictly technological perspective, however, aspects of Cypherium do resemble one new, high-profile project: Libra.
In this article, we are going to compare and contrast the major aspects, examining in detail some of the main points of contention between the two blockchains. Ultimately, this will look beyond the technical comparison between the two software designs. Especially given the fact that neither software has fully launched yet, their designs, and furthermore, their stated intentions and project structures will indicate their primary differences between the two.
HotStuff is the algorithm at the heart of both Cypherium’s and Libra’s consensus mechanism. In short, this breakthrough algorithm first put forward by researcher Dahlia Malkhi vastly improves the functionality of Byzantine Fault Tolerant protocols. HotStuff specifically innovates the view-change mechanism of traditional asynchronous byzantine fault tolerance, making this more efficient (both faster and more economical) by an order of magnitude. For more on how specifically the algorithm accomplishes this, check out some of our previous posts on HotStuff.
Libra and Cypherium each adopt this algorithm in fairly familiar ways, towards a byzantine fault-tolerant consensus. However, this mechanism alone necessitates a centralized committee to uphold the validity of the transactions filling each block. This is where the two projects diverge. Libra’s adoption of HotStuff seeks not only its efficiency but also its potential for centralization. The federation of accepted nodes here confers total control over the network to the Libra Association, the governing body of the network, which we will address shortly. Cypherium on the other utilizes Hotstuff as only part of its dual chain structure. Together with a HotStuff-structured BFT chain for verifying transactions, Cypherium employs another chain, a minting chain that uses Bitcoin’s Proof-of-Work to elect new participants in the network. In this way, Cypherium maintains the primary promise of blockchains: full decentralization. Cypherium’s consensus mechanism allows anyone to operate the network, making its governance fully democratic.
JVM vs MOVE
Both Cypherium and Libra will operate as smart contract platforms, in addition to distributed ledgers. Like Ethereum’s Solidity, Libra has chosen to create its own specialized contracting language, named “Move.” This is another critical distinction between the two projects. Following Etherum, Libra’s choice to use a special language demonstrates its aspiration to become an entirely new technological standard. The hope, it seems, is that new developers, who want to create dApps with meaningful adoption, will have to do so by going through Libra. Requiring of them that their project be written in Move will be one way to consolidate all creation and communication on one network.
Cypherium, however, in keeping with its belief in the promise of blockchain as a diverse multi-project space, runs on Java, the most popular coding language in the world. This provides Cyperium with a preexisting developer base, and it lays the groundwork for the migration of technology into our new decentralized era. This leverages legacy technology, but because the Cypherium Virtual Machine (CVM) is fully compatible with Solidity, it integrates any horizontal build that may push forward our technology in these early days. At Cypherium, we believe that for crypto to succeed on the world stage, we will have to go far, fast. That means enlisting the talents of coders the world over in order to deliver our killer dApps, particularly in the world of open finance and payments. And the best way to do that continues to be widening — not limiting — the opportunities for makers to make and for collaborations to form.
The greatest difference between Cypherium and Libra, however, remains the structure and intention of the two projects. Of course, there is a difference in scale. Libra enjoys the advantages of being started by one of the largest companies in the world, Facebook. Libra has over 2.7 billion potential users, and it had this base before the project became public knowledge. In the same vein, Libra’s resources — particularly, its money and human talent — can not be compared to the culture of a startup. In fact, Libra is more akin to a governmental project in its scope and scale. Its user-base exceeds the size of most nations, as do its funds and corporate ties.
A project of this immensity has its disadvantages as well. The foremost among them maybe its inelasticity. In this new landscape of decentralized tech, standards and practices are in a constant state of flux. For projects to leverage this atmosphere of change, and not fight against it, they must be agile, ready to adapt to new breakthroughs and modifications in not just the technology itself, but also the regulations, and the self-administered habits of our community. Obviously, though, the scale of Libra alone would be advantageous, on the whole, for any project looking to decentralize the future of payments. Libra, however, has made a number of foundational choices that detract from such a mission.
Taken from its whitepaper, here are the three organizing tenents of the platform:
1. It is built on a secure, scalable, and reliable blockchain;
2. It is backed by a reserve of assets designed to give it intrinsic value;
3. It is governed by the independent Libra Association tasked with evolving the ecosystem
First, a secure reliable blockchain. This, as we have already covered, depends upon similar technology to Cypherium. Namely, a BFT consensus mechanism built around the HotStuff algorithm. We certainly believe as Facebook does, that this does constitute the most secure scalable, and reliable blockchain available. However, the following two tenets undercut the promise of blockchain itself.
One would hope that blockchains are innately resilient to the kinds of insecurities of centralized technologies. However, as Facebook has shown, the bigger and more concentrated the network structure, the more vulnerable the data becomes. Facebook’s history with security goes beyond chequered: in addition to perpetrating (and attempting to cover up) the selling of user data to British intelligence firm Cambridge Analytica, which contributed to a number of far-right causes, swaying elections, and even caused deaths, there have been numerous other breaches, of lower-profile but similar scale. Hundreds of millions of users have been made vulnerable by Facebook’s poor data security practices, as well as its ravenous profit-seeking.
This can easily bleed into their stewardship of Libra. The creation of cryptocurrencies comes in part from a distrust of normal corporate power structures, where users have little (or no) say in how their data moves through the economy. Libra cannot address this kind of issue; at best, it may strengthen the consolidated corporate power of Facebook at the members of the Libra Association, while at worst, this could provide the conditions for the great data collapse in history.
Facebook’s choice to tether Libra to a currency reserve chokes the potential of a truly public blockchain. The currency will ultimately be a stand-in for the reserve itself, and because the reserve is 50% USD, Libra will be de facto controlled by the dollar and the U.S. government. Instead of new technology, Libra’s currency will become only a new face on typical fiat — the difference being that Libra will be far more heavily surveilled by Facebook. As scandals such as Cambridge Analytica have shown, this should be a terrifying prospect for the average user. A standard-backed decentralized may, in fact, be a contradiction in terms, as DLTs’ entire value proposition relies on their peer-to-peer nature.
Moreover, beyond government surveillance and stake through the Libra reserve, every aspect of the network will be subject to the governance of the Libra Association. Blockchains emerged out of the dissatisfaction with the corporate mastery of all financial instruments. Bitcoin and Ethereum sought to return some financial autonomy to the public. Handing complete control of our currencies over to the Libra Association, which is comprised of the most concentrated guards of financial power, undermines the very notion of a permissionless blockchain and will, in effect, paralyze the financial autonomy of the disempowered people Libra seeks to enfranchise.
Even with this network of major corporations, and a 50% USD reserve, there is no telling how this project will be met by regulators. Mark Zuckerberg recently announced that Libra’s initial 2020 goal will not come to fruition, as the project is expected to be released in about a year. Regulators have become increasingly skeptical about the concentration of global power held in a handful of American tech companies — from Donald Trump calling the U.S. Postal Service “Amazon’s delivery boy” to democrats candidates calling for “breaking up” several of these giants. In short, the world’s governments and banking networks will not so willingly hand over their national monetary systems to Facebook, simply in the name of expedience. The only technologies that will be able to stand up for themselves under such scrutiny will be the stack of truly useful, permissionless protocols, upheld solely by the users in their networks.
For these reasons, Cypherium presents an open, permissionless version of the HotStuff protocol, coupled with Bitcoin’s original proof-of-work concept. This distinction is critical in understanding the truly disruptive nature of blockchain itself. The most successful DLTs, the ones that will populate a multichain future, must allow their technology to precede their ideological mandates. At Cypherium, we do just that.