The FIO Protocol — Overview
The high-level goal of the FIO Protocol is to deliver for the entire blockchain ecosystem what HTTP delivered for the Internet — usability.
The FIO Protocol is a decentralized service layer to the entire blockchain ecosystem. It provides workflow, data, and confirmations leading up to transactions on other blockchains (it never interferes with any underlying blockchain mechanism).
The FIO Protocol does not integrate with nor interact directly with any other blockchain, rather, it integrates with the “crypto endpoints” such as wallets, exchanges and crypto payment processors. The FIO Protocol does not commit transactions to other blockchains; users and computers continue to do that as they normally would — signing those transactions with their private key for their respective chain.
The FIO Protocol is a Delegated Proof of Stake (DPoS) blockchain that is designed to ensure high scalability, while providing adequate economic incentives to the block producers who secure the network. It is not an open smart contract or dApp platform. Rather, it is purpose-built — new features (such as specific smart contracts) can only be enabled through approval of the block producing nodes.
It has a token — the FIO Token — which is used to pay for transactions on the blockchain. Most users will not need to be bothered with individual transactions as they will simply pay a modest yearly registration cost associated with FIO Addresses, which then comes bundled with a high volume of transactions. In the future, it is anticipated that businesses that become high volume users will want access to certain premium protocol features which will incur additional FIO token charges.
What can the FIO Protocol do?
The FIO Protocol will initially provide three core capabilities:
1) FIO Addresses– your human readable wallet name which works identically and immediately across every single token or coin and eliminates the need to ever see a public address. FIO Addresses are designed with privacy in mind. The name itself is only stored as a hash on the blockchain and the correlation of a FIO Addresses to the wallet’s public addresses are only stored in an encrypted fashion (unless the user chooses otherwise). Decrypting is only possible by a valid counter party in a transaction with FIO key pairs, thereby making it impossible for anyone to “look up” the public addresses of someone based only on knowing their FIO Address. Use of FIO Addresses also makes refunds or reversing of transactions easy for a recipient as they don’t need to request the sender’s public address. Most people will simply register a username on their wallet’s FIO domain as these will be very inexpensive. However, users can also register their own FIO Domain. FIO Domains, if purchased, are stored as a self-sovereign NFT (non-fungible token), which is tied to the user’s FIO private key to be traded/transferred.
2) FIO Requests — normal fiat financial transactions usually begin with a payment request — a bill, a check, an invoice or an order cart. In blockchain, most transactions start with simply a “send”. FIO Requests changes that paradigm and enables the ability to securely send decentralized requests for payments from one FIO enabled wallet to any other FIO enabled wallet. All requests made between FIO Addresses are stored encrypted on-chain, which includes all the data necessary for the recipient to populate a send transaction. They can only be decrypted by the counter party for which they are intended. Requests are discovered by FIO enabled applications querying the blockchain through an API. Importantly, FIO Requests do NOT require any “awareness” from other blockchains. The request itself will contain the token type, amount, payee’s FIO Address, payor’s FIO Address, and FIO Data (metadata) associated with the request.
3) FIO Data — Most transactions of value come with data describing what the transaction is for, such as the details on an invoice or in an order cart. FIO Data is a standardized metadata field that can provide a simple note or, in the future, complex structured data like an order cart along with a sent payment or a FIO Request.
How exactly do I use the FIO Protocol?
As a crypto application — integrating the FIO Protocol can look very differently based on your specific needs. We are initially focused on wallets, exchanges, and crypto payment processors as primary integrating partners, but the use case of FIO can extend beyond them. The FIO Protocol does not dictate the exact user interface within any application. Rather, a suite of Software Development Kits (SDKs) and Application Programming Interfaces (APIs) are being developed and will be made available on an open source basis to anyone desiring to utilize them. FIO Members are wallets, exchanges and crypto payment processors that are intending to integrate the FIO Protocol. They receive certain benefits for being early adopters of the FIO Protocol.
As a user — your path to using FIO is even simpler. Simply register a FIO Address and you will have access to most FIO capabilities. You can acquire a FIO Address in-wallet through any of our FIO Members soon after mainnet launch, or you can do this earlier through our FIO Address Pre-Sale. Over time, the FIO Protocol will continue to grow in feature-set, and as long your wallet does the subsequent integration, you will have full access to those capabilities.
Will I Need to Acquire FIO Tokens to Utilize the Protocol?
The acquisition of tokens to use various blockchains is easily one of the largest points of user friction in this space. To mitigate this, FIO has several unique design elements that will make this process as seamless as possible for users who do not want to go through the tedium of using an exchange.
1) FIO Addresses, when registered, provide a set of “bundled” transactions, which can be used for any of the FIO Protocol’s capabilities. This included bundle is replenished every time you renew your FIO Address for another year. The goal is to ensure that most users encounter minimal, if any, transaction fees.
2) We are planning to encourage and enable FIO enabled wallets to provide for FIO Address registrations that can optionally be paid for with other cryptocurrencies outside of FIO tokens. When renewal time comes (which will involve you receiving a FIO Request), you would then be able to pay with a token or coin that is already in your wallet.
More details on the FIO token will be in a future post, in addition to details on the fee-structure. If you have technical expertise in blockchain and are interested in providing feedback on the FIO Protocol, please consider joining our Technical Advisory Group. You will be able to access the full technical whitepaper as part of this group (the whitepaper will also be published shortly to the public).
This article is #2 in a series of blog posts diving deeper into FIO and the FIO Protocol. We will posting a new article every Thursday over the summer — our next topic will be a deep dive on FIO Addresses. Our previous post was an Introduction to FIO.
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