As the new year begins, we’re taking some time to recalibrate our vision, refresh our roadmap, and set the stage for our next significant milestone.
Making sense of the crypto winter
The promise of blockchain technology has brought tremendous excitement and euphoria, reaching a local peak in December 2017. Understandably, it is in our nature to get excited and overestimate the short term impact of technology. By contrast, 2018 was a year of correction, reckoning, and cleansing. By the end of the year, many supposed crypto funds were but one step from insolvency, with dozens of the once-promising crypto projects nearly bankrupt.
While nearly everyone got burned with the correction,”easy money” has practically evaporated. The market has not only cleansed the landscape, but has also pushed back on the immediate visions of our future.
Still, it is precisely when most people lose hope, stumble and falter, that the greatest opportunities arise. The night is darkest before dawn. But the dawn is coming.
To grow fast you need time to build a foundation
Elrond began at the end of 2017 fueled by a passion to solve what we thought were the most pressing problems in the space: scalability, efficiency, and interoperability.
The vision we set out with, was that Elrond should be a value transfer protocol. One that can scale, is fast, and comparatively efficient. As we progressed, it became clear to us, that the digital economy consisted of two important parts: programmable money, and unstoppable applications. And Elrond could do both, because unlike previous blockchain iterations, it does not have to trade-off performance, for security and decentralization.
Our vision evolved, as we did. And finally, it crystalized into the platform enabling anyone, anywhere, to access the digital economy.
We understood we could only fulfil this vision, by considerably lowering current friction. Friction mounted by weak relative performance in speed and throughput, uncompetitive costs and awful user experience.
Throughout 2018 our focus has been on two important things:
- Gather a strong technical team and enhance our capability of transforming vision into a working product.
- Discover new technical frontiers and solving hard sharding and consensus problems.
For the first part, we have come to a point where we feel we have one of the most experienced and resourceful teams in the space. It took time to build, but the results are starting to show.
Yet one does not judge the strength of a startup team by mere talk, but by results. To our knowledge, we were the first to formalize and present a fully sharded architecture achieving linear throughput, combined with near instant and efficient secure proof of stake consensus via pBFT.
The theoretical paper was only the first step and we’ve published it in May 2018. Immediately after that, our focus has shifted on validating the paper and demonstrating a working prototype doing cross-shard transactions. We first released this prototype in July 2018, and eventually made it open source in November 2018. — Elrond github
Build a prototype, learn, revise
For our prototype we’ve designed a modular, plug and play architecture. The modules are decoupled, having single responsibility, and ensuring maximal flexibility for future updates. The architecture contains 3 packages: a UI wallet, a node app, and the Elrond Core.
The Elrond Core was divided into several layers. The cryptographic layer contains novel cryptography done via a Schnorr scheme for transactions signing, and Bellare — Neven multisignature scheme for block signing. The data layer contains a data model with blocks, transactions, accounts, and the execution layer processes transactions, assembles blocks, and maintains state across all nodes for consistency and security.
The communication layer is the network protocol that ensures node connectivity and discovery, direct messaging, and operations to broadcast blocks, transactions and receipts( for cross-shard transactions).
The consensus layer has introduced a rudimentary form of PoS based on pBFT. The sharding layer was built to demonstrate a state sharded architecture, containing network sharding, transaction sharding, and storage sharding.
All this was done in our prototype for one reason: to validate the hypothesis that we can do cross-shard transactions, and hence, scale linearly.
This effort puts Elrond in stark contrast with the empty performance claims marketed by numerous blockchain projects.
Testnet: use what you learned, write everything from scratch
With the prototype released, we learned some insightful lessons about the limitations of Java libraries. Thus, Elrond Core has been rewritten from scratch in GO for our testnet, to incorporate our new findings, and leverage drastically more optimized GO libraries.
Results could not be more promising. Initial internal testing shows a 30x improvement in throughput compared to our prototype. A feat practically impossible without the lessons from our prototype.
Back to the future: what 2019 looks like
2019 is divided into 4 phases. The inception phase, is focused on launching a test network with a working sharding model, efficient and fast secure proof of stake consensus, along with the Elrond VM, bringing support for EVM and Wasm contracts with formal verification. Building on this, we will feature the launch of a major product which has been in the works, effectively transforming our solution from developer first, to user first(more news on this soon).
The second phase will focus on stress-testing, bug hunting, auditing, and heavy preparation for the Main net launch. It will also feature a new wallet with radical user experience, thanks to features like Alias, Multisig, and Timelock. To encourage play, integration and interaction for both curious developers and 3rd party organizations, we will offer an API/SDK with clear commands and instructions.
The third phase will feature Elrond finally going live. It will bring large efforts to fruition, presenting a fast, scalable and efficient architecture, with tools and competitive utility in place. Bootstrapping will begin with the launch, enabling token swaps, the staking mechanism, and incentivizing healthy node participation within the network. During this phase we expect a useful payment gateway to be up and running, mobile wallets to be released, and hardware wallets to be integrated.
The expansion phase will focus on consolidating our previously mentioned efforts, while pushing hard to expand through an internal ecosystem fund. This fund will strongly complement our efforts, encouraging ventures to create a more efficient DEX which leverages our architecture, build a novel stable coin mechanism for open finance, and offer a digital identity app that is simple and useful.
Despite numerous obstacles, we’ve come a long way. Our focused team has worked tirelessly to reach proposed milestones. The testnet is very close to launch, and we’re very excited to share our refreshed roadmap with you.
The next month will bring an important marketing and communication push, followed by a more closer collaboration with our community.
We tend to exaggerate the impact of technology on the short term, but massively underestimate its impact on the long term. It’s clear that blockchains are early today, but they will undoubtedly transform economies tomorrow.
Come join us, and be part of this transforming journey.