Theta Network & a vision of blockchain interoperability
At Theta Labs, our #1 focus will always be making Theta Network the leading decentralized data delivery network. That said, Theta Network is just one of dozens of cutting-edge blockchains in development. There are innovative Dapps being built on top of many different blockchain protocols, and we don’t expect the blockchain ‘platform wars’ to end in a winner-take-all situation. The blockchain space is large enough for many different chains to succeed, but for that to happen it’s critical that these networks interact with each other, not just exist in silos.
We believe that the future of blockchain networks is an ecosystem of application-specific blockchains (ASBs), such as the Theta protocol, connected in a wide mesh of blockchains that are fully capable of communicating, interacting, and transacting value with each other. There are numerous benefits to this vision of blockchain interoperability:
- Scalability — by deploying Dapps onto many different chains, transaction throughput is no longer split among 100s of competing applications. Individual dapps have significantly more room to scale and meet the needs of growing userbases, which will allow more mainstream applications to migrate to blockchain environments.
- Security — Rather than competing for network security (either via hash power or number of tokens staked), different blockchains can add to each chain’s security by sharing network states and transaction records. This changes network security from a winner-take-all game to a cooperative one, where the success of one blockchain benefits many networks.
- Specialization — Different use cases can merit different design choices and tradeoffs; for example, Theta blockchain prioritizes maximizing off-chain micropayments rather than instant finality, reflecting that the typical TFUEL transaction is of small value and does not require instant finality. Other blockchain use cases may benefit from different design choices, so it’s counterproductive to require each to follow the exact same rules and designs.
From a design philosophy standpoint, the Theta protocol’s Multi-BFT consensus mechanism was in some ways inspired by Tendermint, the consensus model that’s the basis of the Cosmos Hub and powers Binance Chain, Loom, and many others. While the Theta blockchain is distinct from Tendermint/Cosmos, we agree with their vision of application-specific blockchains serving many different use cases, rather than all on-chain transactions occurring on a handful of dominant blockchains.
That’s also why we’re developing a smart contract runtime environment compatible with the Ethereum Virtual Machine, to deploy on the Theta blockchain later this year. This will allow Solidity-based Ethereum smart contracts to be ported to the Theta Ledger with little effort, and more broadly make it easier for platforms to build dapps, collectible items using Non-Fungible Tokens, or even fully-fledged new token ecosystems on top of the Theta blockchain.
But it’s when Theta starts interacting directly with other blockchains that the possibilities get really interesting. For example, a hypothetical video platform’s token ‘VPT’ could exist on both Theta and Ethereum blockchains at the same time, with a shared fixed token supply of 1,000,000 and identical value of tokens on each chain. To transfer between chains, 10,000 VPT tokens could be burned on Ethereum while another 10,000 VPT are simultaneously created on the Theta blockchain, maintaining VPT’s fixed token supply of 1,000,000. To the user, this action would appear to be a seamless move of their tokens from one blockchain to another, with only a small ETH gas fee on Ethereum and a small amount of TFUEL burned on Theta to complete the token burn/creation action.
In our vision, Theta will be the leading blockchain focused on decentralized data delivery, purpose-built to facilitate that more effectively than any other blockchain. There are many other blockchain uses cases like supply chain provenance or decentralized finance, which can be handled by other ASBs or general smart contract platforms. Rather than try to do it all, we want Theta to do one thing better than anyone else, and to the extent it suits the Theta project’s goals to work with other blockchains, that can be done via cross-chain communication and transactions.
More details to come as we get closer to launching smart contract support in Q3! In the meantime, feel free to join us in the Theta Telegram channel for discussion and any questions.
