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Monthly report: March 2018

This month we have been working hard to improve the platform and consider further ways of development of the company. We are working on the sidechain and preparing to publish a new roadmap based on changes in our vision. The team focused on exhibitions and conferences in different parts of the world — we are trying new approaches to research our future business area and applying an acquired knowledge already. We visited a huge conference dedicated to cloud technologies — CloudFest in Germany, where we had a chance to met our friends Cloud28+ and chat with Intel and HP. The team was strengthened with a new COO — we invited Oleg Lyubimov to contribute to SONM development. Keep reading to find out more about the team achievements that we went through in March.

Development News

Hub and worker merged. We have combined the Worker and the Hub functionality in one package — this will simplify the configuration of the system on the supplier side. In the process of developing Crypto-IaaS, we noticed that there were no dedicated functions on the Hub — white IP-address is no longer needed as also it’s sharing with the worker due to NAT penetration, and all Workers can act as a Hub, so we decided to merge the Hub and the Worker in one. The supplier has to install only one software package with Worker and it will function as Hub and Worker at the same time. The Worker is an optimized computing unit and this name will be used for suppliers from now on.

User’s profile. On the basis the smart contract, we will conduct a KYC procedure — each of the network participants will get one of four levels:

  • Anonymous status
  • Registered status
  • Identified status
  • Professional status (a certification procedure only for companies, professionally running cloud services, and DCs)

These statuses will be assigned by third-party services. Anonymous status for all users before identification. The registered status will be issued after checking the phone number via SMS service. The identified status will be assigned after the KYC procedure by third-party services, that is performed remotely. The professional status will be available only for companies with cloud expertise, that provide cloud and DC services, the certification would involve physical visiting a company. To complete the procedure, we will have a list of KYC providers that we accept — the user can choose one of them from the list, go through the procedure and this information will be displayed in his profile. You do not have to store your personal data in the blockchain — the data can be stored on the servers of a third-party service, on which the procedure was performed. In the profile we are going to store following attributes: logotype or picture, company name, personal name or nick, the URL of the site, social network links, contact details, such as an email or phone number and some more… but to post such info in the profile it should pass moderation or KYC by third-party services. The list of third-party services will be announced later and will be pluggable in the system design.

Rating system pack. We have implemented a special smart contract to initialize a process of collecting ratings for suppliers and customers. The first version of this feature works in simplified mode — like a blacklist. You can stop the deal on the market if you are not satisfied with the quality of the provided service or anything else, this will add a person who you deal with into your blacklist and will be automatically filtered when you further search for suppliers or customers. There is a possibility to use not only your blacklist but a person who you trust. For example, there are members you know and trust he worked with a lot of users and know who is good and who is not. You can use his list to filter your contractors. There would also be a possibility to run a managed blacklist and offer it to others in the future.

Marketplace update. We have updated the marketplace smart-contract. The new version of smart-contract is an order book on blockchain that stores all BID/ASK requests and deals. This is essentially a decentralized exchange with key checks (requiring consensus) being done on the smart contract level, while the computational intensive searches and operations being done offchain.

  • We have rebuilt an algorithm of the deal matching process and now it runs on a worker node alone — they take all requests from the marketplace and check parameters, if it finds the match, it reports about to the marketplace smart-contract which initiates a deal. This way searching (which is compute intensive and expensive) is effectively offloaded to offchain and being done by the node, directly interested in the result.
  • We have added the algorithm of cancellation of a deal. A customer can cancel the deal anytime and supplier only at the end of the deal.
  • The function of extension of the deal is implemented: any of the participants can offer a change in the duration and price of the deal, but the consent of the other party is required.
  • Also, we included money transfer functions into it — at the opening of the deal, the client’s tokens are transferring to the market address and freeze there, at the end of the transaction the tokens are sending to the supplier. If the deal was interrupted, the funds are divided in proportion to the time of use of the resources.
  • There is also an option to make a spot deal, which is same as a common time-limited deal, with one exception, that a spot deal may be closed by both parties at any time (not only the customer).

Relay addition to the NAT penetration. If two Workers behind a NAT cannot connect directly with each other (and the NAT penetration procedure fails, which happens on some rare NAT configurations), then they can use a distributed service with a special algorithm to let all the traffic go by itself. Now, this service is provided by the SONM, later it will be decentralized and will be hosted on the computers of participants (as a self-paying SONM task — a fog service).

Product Vision Updates

Private blockchain and Masternodes. Working on SONM blockchain we have some tasks, that must be performed in a trusted way out of the chain. First of such tasks is implementing a gatekeeper node to allow token transfer between Ethereum masterchain and SONM sidechain. Another would be running the PoA/PoS mining nodes. Building a decentralized system was always a priority for us, so a decentralized approach to this tasks is implementing a Masternodes, using SNM in a proof-of-stake fashion.

We will first implement a Masternodes for gatekeeping functions, to enable SNM token transfer between Ethereum and SONM blockchain. Establishing the Masternode would require holding a decent amount of SNM tokens, yet the exact value and conditions are being estimated.

Running the Masternode will benefit an owner — the more SNM tokens he’s got, the better. We are going to implement Proof-of-Stake consensus algorithm to provide proportional sharing of profits between the owners of the master nodes.

Stable deal prices. SNM tokens are going to be used to pay for computing powers on SONM marketplace. At the same time, the token price fluctuates (as most cryptocurrency) making it hard to predict the price and thus settle a deal for a long-term (either Customer or Supplier may lose value in a long-term deal). To solve this, there would be an option to set the deal price in some other stable currency of coins. While this price would be set in connection with another currency, the payment itself would be made in SNM. The exact amount of SNM required for each deal billing interval would be calculated based on SNM/currency price on the market at the time of billing. The SNM/currency prices would be provided on-chain by oracles, which would be part of the masternode duties.




We have partnered with Hacken — a group of enterprises created in order to maintain links between blockchain and cybersecurity communities, the promotion of hacker ethics and the encouragement of legitimate research on computer networks and software.

The purpose of our cooperation is ensuring the security of the SONM network for all its users — Hacken experts will help us in this. Read the full version of this announcement on our blog.


CloudFest was a great event for mature Cloud companies and we have been presenting the SONM to declare the coming of the fog computing to this business. We had a huge booth there so people liked hanging out with the SONM team there. The conference was a giant 2500+ companies, more than 7,000 exhibitors, and over 250 speakers, among whom were even Edward Snowden. And we were pleased that we were very warmly welcomed despite the fact that we are going to compete with the Cloud providers.

Here are some photos:

SONM CTO Igor Lebedev introduced SONM at the conference. Igor told about the drawbacks of the classical computing solutions architecture in front of the challenge of modern times and how you can solve all these problems with the help of fog computing. Watch the full version of the speech.

We made a meetup right there in Rust to let CloudFest visitors have a closer look at the SONM team and discuss the technology that we are going to implement.

Hong Kong meetup.

We organized the meeting to find local representatives of the company and a lot of people came to us despite the busy day.

Cloud and Digital Transformation conference.

SONM CTO Igor was invited to the Cloud & Digital Transformation conference in Moscow to speak on the topic “Fog computing — a step into the future”. Igor performed brilliantly, there was even a broadcast on Instagram. By the way, if you are not yet subscribed — do it now, there we’ll post photos showing SONM life.

DeCenter conference.

Igor also attended another conference in Moscow — DeCenter, and presented the concept of “Cloud services on mining equipment” — this is exactly what we are going to provide in the near future.

Team News

Oleg Lyubimov — Chief Operations Officer. Oleg has more than 10 years of expertise in the cloud and telecom markets, he was the COO at Selectel and now he has joined SONM team. Oleg’s primary tasks at SONM will be to launch the platform and product into international markets. Oleg will be responsible for implementing appropriate business methods and practices suitable for achieving strategic company goals. He will also take ownership over the B2B sales and seek new applications of SONM.

Denis Polygalov — Project Manager (software engineering).Denis has more than 10 years in software developing. He had experience managing distributed large teams of developers, and applying both the classical (waterfall model) and various agile software development. In the last few years, Denis has worked for Prognoz and Parma TG, where he has implemented several large IT projects for Federal Government Customers.


March was filled with various events — we participated in conferences and organized meetups in different parts of the world, we were invited as experts to the conferences in Moscow. It was difficult to catch everything, but we were able to manage everything. We are finding the new exciting solutions for the product and implementing ideas that will make the final product user-friendly and reliable. Thank you for being with us and stay tuned — all the fun is yet to come.

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