The world’s greatest tech companies started from nothing. Giants like Apple and Microsoft were founded by one or two ambitious individuals, but their drive, vision and superior technology propelled them to market dominance.
Skycoin, founded in 2013 by Brandon Synth and Houwu Chen, is still a relatively unknown player in the blockchain industry. But over the past five years, the organization has grown to over 100 employees across multiple countries. As the crypto market matures, this is an opportune time to evaluate Skycoin’s strengths and weaknesses compared to its competitors.
But Skycoin is more than just a cryptocurrency. It’s a comprehensive blockchain ecosystem that incorporates a broad range of software, services, solutions, and custom hardware products. There’s no single challenger that competes with Skycoin across all facets of the platform, so it makes sense to break down the Skycoin ecosystem into each of its key elements, and conduct a competitive analysis for each.
This article, part one of a five-part series, will explore Skywire (Skycoin’s decentralized Internet service). Future articles will cover CX (Skycoin’s feature rich programming language), Fiber (Skycoin’s infinitely scalable blockchain solution, Obelisk (Skycoin’s revolutionary consensus algorithm), and finally the Skycoin digital currency itself.
What is Skywire?
To put it simply, Skywire is a new Internet.
So why do we need a new Internet?
Because the current Internet is broken. Governments monitor and censor your traffic. ISPs exist as monopolies or oligopolies and overcharge for subpar services. Your private data is sold to advertisers. And the entire network runs on centralized infrastructure that can be blocked or shut down at any time by governments, invading forces, or natural disasters.
Skywire is the world’s first global mesh network. A new peer-to-peer Internet built using custom hardware nodes called Skyminers that can communicate with each other directly via wireless, radio, laser, satellite, cable, or fiber links, thus bypassing traditional ISPs.
Skywire nodes earn cryptocurrency for providing bandwidth, storage and computing resources to other users of the network. All communication is encrypted, and IP addresses are not used. This means Skywire is private, anonymous, ISP independent, uncensorable, incentivized, fully decentralized, and free from government control.
Who are Skywire’s competitors?
Skywire’s competition can be divided into four broad categories.
1. Traditional ISPs — Comcast, AT&T, Verizon, Virgin Media, China Telecom, BSNL, Telstra etc.
2. Local wireless community networks — NYC Mesh, Detroit Digital Stewards, Pittsburgh MetaMesh etc.
3. Software-based decentralized Internet platforms — Holochain, Substratum, Elastos, NKN, Orchid, Tor.
4. Hardware-based decentralized Internet platforms — Althea, Ammbr, BlockMesh, RightMesh, SmartMesh, iungo, Nexus, GoTenna, Hyperboria.
The following table summarizes Skycoin’s competitors. A more detailed analysis continues below the table.
1. Skywire vs. Legacy ISPs
Traditional ISPs like Comcast are the incumbent providers of Internet connectivity around the world. These organizations typically exist as monopolies or oligopolies, and overcharge their customers for substandard services. It’s unprofitable for ISPs to operate in remote or impoverished areas, often leaving these locations lacking any reliable Internet service.
Traditional ISPs can monitor and censor your traffic, and sell your private data to advertisers. Their centralized infrastructure can be shut down by governments, invading forces, or natural disasters. ISPs can block all encrypted traffic, block specific VPNs, block individual websites, or block traffic to/from certain IP addresses.
In March 2019, the major ISPs in New Zealand and Australia blocked access to websites hosting or discussing footage of the Christchurch shooting. Censored sites include 4Chan, 8Chan, Voat, LiveLeak, Archive, Bitchute, Zerohedge and KiwiFarms.
Furthermore, the recently passed EU Article 13 forces technology companies to police the content on their sites, and to scan and filter any material suspected of copyright violation. Facebook CEO Mark Zuckerberg has asked regulators and governments to introduce even more stringent content laws. Any websites that fail to follow these rules could also be blocked by ISPs.
Many citizens use VPNs to circumvent this type of censorship, however at least 13 nations around the world have already banned the use of VPNs. VPNs are likely to be criminalized in more countries, or restricted to registered users only, if citizens continue to use them to bypass government censorship. Even in a supposedly progressive country like Australia, draconian new anti-encryption laws already allow the Australian government to rule VPNs illegal.
In summary, traditional ISPs are the antithesis to Skywire. They’re not private, independent, uncensorable or decentralized. They’re expensive, and they offer no financial incentive to users. Customers have long been dissatisfied with the service provided by traditional ISPs, and although they remain the dominant provider of Internet services today, they offer no technical or financial benefits compared to Skywire. As such, this is the sector that offers the greatest market opportunity for Skywire penetration, especially as censorship and cyberbalkanization continue to escalate globally.
2. Skywire vs. Local Wireless Community Networks
Community meshnets have sprung up around the world in response to the excessive fees charged by traditional ISPs, and the reluctance of those ISPs to deliver services to remote and low-income areas. Two prominent examples of community meshnets are NYC Mesh and Detroit Digital Stewards.
These networks are built and maintained by volunteers, who install antennas on rooftops and connect local residents to the mesh. To reach the wider Internet, traffic is routed from one node to another, eventually reaching a resident with a traditional ISP connection (i.e. the backhaul uplinks are still provided by ISPs).
These meshnets offer several benefits over traditional ISPs. Access is free, and traffic within the local mesh is uncensorable, decentralized, and ISP independent. Traffic is not necessarily private by default, but users may run a VPN over the meshnet for improved privacy (although IP addresses would still be visible).
The main drawback of community meshnets is the lack of structured financial incentives for running nodes. This limits the scalability of these networks. There’s a limit to the number of community members willing to deploy and maintain infrastructure for free, and the prohibitive cost of dedicated long-distance backhaul links means these meshnets are limited to local areas, with access beyond that zone still reliant on ISPs.
Skywire improves upon this approach by incentivizing nodes through cryptocurrency payments. These incentives have already encouraged the Skywire community to deploy almost 10,000 nodes around the world.
With Skywire, even the provision of dedicated backhaul connections (satellite or fiber uplinks at colocation centers) becomes financially viable, since backhaul nodes will earn a substantial volume of coins based upon the aggregate traffic carried. And for shorter distances, elevated line-of-sight antennas mounted on towers or hillside homes could span the distance between neighboring towns. The financial incentive for deploying these long-distance aggregate links will fully liberate Skywire from ISP dependence, even for intercontinental traffic.
In summary, community meshnets, rather than being viewed as a threat to Skywire, should instead be seen as a further market opportunity. It’s likely that many community meshnets will transition to Skywire infrastructure in order to improve privacy, incentivize node operators, eliminate ISP dependence, and expand beyond their local neighborhoods.
3. Skywire vs. software-based Internet platforms
Many blockchain platforms claim to offer a decentralized Internet service. These include Holochain, Substratum, Elastos, NKN (New Kind of Network), and Orchid Protocol.
But none of these platforms can be considered true competitors to Skywire, because they all rely on traditional Internet Service Providers. They essentially act as VPNs running over the existing Internet. They can therefore be blocked by ISPs. VPNs have already been banned in multiple countries around the world. ISPs can block all encrypted traffic, or block specific VPNs, or block traffic to/from certain IP addresses.
These platforms are also expensive, because the costly ISP service must be retained. And aside from Substratum, which is running in a limited beta mode, none of these platforms are actually operational.
Holochain intends to use a token to incentivize the sharing of bandwidth, storage and computing resources, but it is currently running a closed private testnet only. And while the company has promised to release dedicated hardware nodes called Holoports, these are not yet available, and they will still rely on legacy ISPs to communicate.
NKN claims to have deployed approximately 7000 nodes. These will eventually create a decentralized bandwidth-sharing service, incentivized using ERC20 tokens. However this is not yet operational. NKN does not intend to offer decentralized storage or computing resources.
Orchid Protocol aims to deliver a similar service to NKN, but once again this is not currently operational. It is unclear how many nodes (if any) have been deployed. The company’s website offers limited information and no roadmap.
Substratum intends to use an ERC20 token to incentivize the sharing of bandwidth, storage and computing resources. The project has progressed further than the above platforms, in that Substratum is currently operating in a limited beta mode. This phase allows users to surf most of the Internet, but video is not yet supported, and the token-earning mechanism is not enabled.
Elastos is developing a decentralized operating system that will be used to host DApps and data for mobile and IOT devices. The Elastos platform acts as a ‘middle man’ layer between these DApps and the wider Internet. DApps can only communicate with other DApps within the Elastos ecosystem. For example, if an Elastos developer created a web browser, this browser could only see content that exists within the Elastos ecosystem — it would not be able to access Google or Facebook. This design is intended to isolate the Elastos community from the risk of malware, identity theft and copyright infringement prevalent in the regular Internet. Elastos has over 300,000 nodes, mostly preinstalled on televisions and other consumer electronic devices in China. No DApps have been developed yet, and the platform is not operational. The goal of Elastos is quite different to that of Skywire, and it is not considered to be a competitor.
Tor. Finally, it’s appropriate to mention the most popular non-blockchain decentralized platform. Tor is an anonymity network that directs traffic through a system of several thousand volunteer-run relay nodes. Traffic is encrypted and IP addresses are concealed. Tor essentially operates as a free multi-hop VPN service. Tor is known to suffer from multiple weaknesses, and there are legitimate concerns that the Tor network is funded and controlled by US security agencies, raising questions about its purported privacy and anonymity. Several countries, including Turkey, have banned and blocked Tor.
In summary, all of the above software-based decentralized Internet solutions rely on centralized ISPs, so they cannot be considered true competitors to Skywire. Furthermore, the only one that is actually operational today is Tor — a slow, outdated and potentially insecure multi-hop VPN service, which is not cryptocurrency-based and which offers no financial incentive for node operators.
4. Skywire vs. hardware-based Internet platforms
Finally, we come to the platforms that may be capable of mounting a challenge to Skywire. As with Skywire, these hardware-based decentralized Internet platforms aim to deploy physical infrastructure that enables nodes to connect wirelessly, thus bypassing centralized ISPs. Solutions considered here include Althea, Ammbr, BlockMesh, RightMesh, SmartMesh, iungo, Nexus Earth, GoTenna, and Hyperboria.
Let’s begin with RightMesh, SmartMesh, and iungo. These three platforms share essentially the same objective. They will use ERC20 tokens to incentivize users to create local meshnets using the Wi-Fi and Bluetooth capabilities of their existing smartphones and wireless devices. BlockMesh is similar, except that it intends to build its own range of Wi-Fi routers for increased range. None of these platforms are currently operational, and the low Wi-Fi and Bluetooth signal strength of the target devices limits the potential scale of these networks (long distance and backhaul would still rely on ISPs).
Ammbr is a more ambitious project that intends to manufacture dedicated hardware nodes with storage, computing resources and wireless capabilities, somewhat similar to Skywire nodes with antennas. Ammbr will use an ERC20 token to incentivize the deployment of these resources to create a mesh network. The Ammbr crowdsale completed in March 2019, and the development team hopes to release hardware nodes by the end of the year, however at this stage the platform is not operational.
Nexus Earth is another ambitious project that intends to launch satellites and build a global meshnet using custom-built nodes fitted with antennas. The developers expect to require approximately 2000 cube satellites in low-earth orbit in order to cover the globe. None of this infrastructure is in place yet, and there is no clear timeframe for deployment. The platform is currently not operational.
Althea is the only cryptocurrency-based Skywire competitor that is actually operational today. Althea has already deployed two wireless meshnets, one in Clatskanie, a small town in northwestern Oregon, and another in Medellin, Colombia. Althea works by installing software on network routers, allowing these devices to pay each other for bandwidth using Ethereum or other ERC20 tokens (Althea does not have its own dedicated token). The routers can communicate with each other using antennas or direct cable connections.
GoTenna develops small portable wireless devices that pair with smartphones to enable off-grid decentralized communication between users. The devices are only capable of text messaging and GPS location sharing over a maximum distance of four miles under optimum conditions. GoTenna’s objectives are quite different to that of Skywire and they are not considered to be a competitor.
Hyperboria is an IPv6 CJDNS darknet. Nodes can connect wirelessly, or over existing ISP infrastructure. Access to the darknet is by invitation only — new nodes must be invited and accepted into the network by someone with an existing node. The network is not cryptocurrency-based, and there are no financial incentives for running nodes, meaning backhaul links still rely on traditional ISPs. These barriers to entry limit the potential adoption of Hyperboria. It is not considered to be a threat to Skywire.
Of all the projects reviewed, Althea is the only one currently capable of mounting a challenge to Skywire.
However Skywire is a far more comprehensive solution. Skywire nodes enable the sharing of storage and computing resources, not just bandwidth, and Skywire is just one part of the meticulously designed Skycoin blockchain ecosystem. Althea’s lead developer recently partook in an online debate with Skywire’s lead developer Synth regarding the relative strengths and weaknesses of each platform. A detailed summary of that debate can be found here.
Ammbr shows promise, however by the time the company releases its hardware nodes and begins to build its meshnet, Skywire (with almost 10,000 nodes already deployed) will have gained a substantial head start.
Nexus Earth, with its proposed fleet of 2000 cube satellites sounds promising at first glance, but the cost and technical complexity of this approach raises questions as to whether it can ever get off the ground. There is currently no proposed timeframe for the deployment of this infrastructure. No satellites have been launched yet. Furthermore, the latency and low bandwidth offered by satellites makes them less than ideal to act as the backbone of a global decentralized meshnet.
All of the other reviewed projects are either not operational, reliant on centralized ISPs, or too limited in scope to compete with the Skywire network.
Skywire has been in operation since mid-2018. Incentivized by monthly cryptocurrency rewards, the network has grown rapidly to almost 10,000 dedicated hardware nodes in less than a year.
Skywire nodes currently communicate over regular ISP connections, but the first Skywire antenna prototype is finished, and these antennas will be released publicly in the next few months, enabling the nodes to connect wirelessly. Official Skywire antennas are expected to support ranges of 5km and 15km initially, but community members will also be encouraged to design and build their own antennas to suit their specific needs.
Nodes and antennas are modular in design, capable of being built by anyone using low-cost, readily available components. This means even the poorest and most remote villages on earth can build the infrastructure needed to become part of the world’s first global decentralized meshnet. Skywire nodes can quickly deliver reliable Internet access to regions of the world with little or no communications infrastructure, regions affected by frequent blackouts, or regions that have been devastated by wars, floods, or earthquakes.
Skywire is carrier agnostic, and each node will be able to support multiple transport links, including dark fiber, wireless, radio, laser, satellite (and of course traditional ISP if still desired). Skywire node operators can design and build the optimum combination of node hardware and antenna to suit their individual circumstances — long range or short range, narrow spread or wide spread, high bandwidth or low bandwidth. Nodes may also be configured as regular Wi-Fi hotspots, providing network access to everyone in range (even those without dedicated Skywire hardware).
A region might consist of thousands of Skywire nodes dispersed across a city or rural area, each connecting to the others wirelessly. It only requires one of those nodes to maintain a long-distance uplink to the rest of the world (via satellite, dark fiber or long-range radio for example), in order for every node in that region to stay connected.
Once Skywire achieves mass adoption, it will be impossible for any government or invading army or natural disaster to disrupt enough nodes to prevent the meshnet from continuing to communicate with the rest of the world. Even loss of power won’t interrupt Skywire. Nodes use as little power as a mobile phone, and can run indefinitely on small solar panels. Solar Bankers, a Skycoin partner that launched its ICO on the Skycoin Fiber platform, has already developed a range of panels that can easily power multiple Skywire nodes.
Anyone who wishes to become part of the global Skywire meshnet can purchase an official 8-node Skyminer directly from Skycoin.net, or build your own single-node DIY Skyminer for as little as $40.
Technical support is provided in the Skywire telegram group. Another telegram group, Skywire Meta, focuses on the ‘big picture’ of Skywire deployment, such as antenna designs, community meshnet projects, networking and global communications infrastructure.
Fast. Free. Private. Anonymous. Encrypted. ISP independent. Uncensorable. Decentralized. Incentivized.