Phala Blockchain: All You Need to Know

Blockchain technology, like any other tech, is gradually upgrading. While it offers immense potential, it still has its limitations. New, solution-driven blockchain protocols are emerging to overcome these challenges.

Phala Network’s hybrid blockchain-TEE (trusted execution environment) architecture solves these problems. This configuration lays the groundwork for on-chain smart contracts to govern AI agents (operated by off-chain worker nodes).

In this article, we’ll explore Phala Network, a cloud computing blockchain protocol designed to bring confidentiality to smart contracts used in dApps and DeFi. You’ll learn why smart contract privacy matters, how Phala ensures confidentiality, and explore its key features and overall architecture.

Let’s get started!

What is the Phala Network?

A decentralized cloud computing protocol called Phala Network (PHA) offers a smart contract computing architecture. It combines the ability to create contemporary applications with the decentralized trust and transparency of blockchain technology.

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While developers may integrate their applications with a low-code experience, users can contribute computational power and receive rewards. Zero-knowledge proofs and secure areas are used by the network to guarantee data verification and confidentiality.

• Protect controlled dApp privacy.
• Similar computer power to cloud services.
• Maintain Blockchain security and trustworthiness. All Phala computations are trustless.
• Enable cross-chain communication without compromising privacy.

Any blockchain dApp or smart contract needs cross-chain connectivity to be useful in real life. Phala-powered confidential smart contracts can freely communicate with other confidential contracts.

How Phala Network’s Confidential Smart Contract is Deployed?

Phala Network’s private smart contract deployment is difficult but beneficial. Conception to execution requires several crucial steps. Understanding each stage may clarify blockchain technology.

1. Contract Writing

First, write the contract. Common languages include Solidity and Ink. Solidity is popular among Ethereum developers. Writing a smart contract is like writing a regular contract. Every detail must be correct. Clear terminology is needed, plus prerequisites must be met. The contract code reflects these ideas, and developers must be careful.

2. Testing

After writing the contract, testing begins. In this stage, the contracted functionality must be checked. Various scenarios are considered.

• What about late payments?
• If the data needs correction?

Testing goes beyond error detection, like understanding contract behavior, and different inputs provide different results. Participants include developers, stakeholders, and users. Collect feedback and prompt changes that refine the contract to ensure it aligns with its mission.

3. Deploy

After testing, deploy. Phala Network provides tools and an environment for this. These tools aid the process. They help developers understand deployment. The contract must follow network protocols and privacy and security rules to ensure alignment.

The contract deployment environment is crucial because how well it matches this ecology determines its success.

4. Verification

The final step is verification. This level verifies contract privacy and security. Phala Network is noted for privacy. Contracts must meet these conditions, like code, Privacy protocols, and security assessments.

Verification includes legal and regulatory requirements that must be met. All parties’ rights must be respected. Verification assures legal and ethical compliance.

Components of Phala Network

With involvement from Candaq Group, InfiChain, Blue Mountain Labs, Incuba Alpha Group, and Exoplanet Capital, Phala was able to achieve a funding round in 2020 at a valuation of $10 million. Its solution was created to provide Turing-complete, AI-enabled smart contracts to tackle the problems brought on by centralized cloud computing and artificial intelligence.

In March 2022, Phala won a Polkadot parachain slot auction with 1,685 donors as a result of this momentum. Phala’s current focus is on becoming an AI coprocessor that offers a verified and safe computing solution for the application-layer integration of AI and crypto. Here are some components of Phala Network:

• Decentralized Computing Cloud Network: To ensure the security and verifiability of computation execution, Phala serves as a backend host for scalable blockchain technology and a trusted execution environment (TEE).
• The TEE (SGX) Framework: It is the fundamental Intel TEE architecture concept that guarantees safe and verifiable code execution in a separate, hardware-protected processor area.
• AI Agent Contracts: EVM smart contracts can expand their functionality off-chain with the use of AI agent contracts, which are AI computer applications.
• Blockchain/Phala Nodes: Verified secure worker nodes that access and carry out off-chain transactions. The blockchain is then used by these nodes to structure the decentralized network and provide incentives to employees.

How is Phala Network used?

Within the Phala Network ecosystem, Phala Network (PHA) is a utility token with multiple uses.

PHA tokens are used to compensate miners and gatekeepers for their contributions to the functioning and security of the network.

Here are a few of its main applications:

1. Gas Fees: To facilitate transactions and the execution of smart contracts, PHA tokens are utilized to pay gas fees on the blockchain.
2. Governance: PHA tokens are used for governance, allowing holders to take part in choices that will influence the network’s course.
3. Staking: To protect the network and generate income, PHA tokens can be staked.
4. Interoperability: SubBridge enables the transfer of PHA tokens between several chains, including Ethereum, Khala, and other parachains.

These applications show how crucial the token is to preserving the network’s functionality and encouraging involvement.

Benefits of Phala Network

The Phala Network offers benefits like private and secure computing using Trusted Execution Environments (TEEs), acting as a backbone for AI in Web3, and enabling privacy-protected DeFi trading and data computations. Here are some of the benefits of the Phala network:

• Phala is protected from system-level attacks by processing sensitive data with an isolated processor and allowing only key-protected approved actions on the network.
• End-to-end encryption protects off-chain and on-chain communication
• On-chain verification of off-chain code and execution.
• Phala, a Polkadot substrate-based parachain, supports interoperability and cross-chain communication.
• Phala can power other blockchain apps because it’s interoperable.

Conclusion

Phala Network stands for secure, private, and scalable blockchain cloud computing. Phala protects off-chain calculations using powerful cryptography and secure zones, creating a more resilient and inclusive decentralized ecosystem.

Phala Network enables developers and users to create privacy-centric decentralized applications that transform blockchain technology through strategic partnerships and technical improvements.

Let us know what your thoughts are on Phala Network in the comment section!