2020 is the year when many well-known blockchain projects get together and go online. Cypherium is also one of them. Its mainnet was officially launched in early November. It is understood that the project is a blockchain network based on the proof-of-work and HotStuff hybrid consensus mechanism. It aims to meet the performance requirements of enterprise-level applications and provide technical solutions for central bank digital currency issuance. It is the US Faster Payments Council under the Federal Reserve member.
Recently, the chain catcher interviewed Cypherium founder Sky Guo (Chinese name Guo Yangrui), and talked in detail about the opportunities and challenges that exist in the central bank's digital currency market and the enterprise application market.
Author | Loners Liu
01
Opportunities in the central bank's digital currency market
Chain Catcher: You take central bank digital currency and enterprise-level applications as the main application directions in the future. Why did you choose this way?
Sky Guo: Central bank digital currency and enterprise-level applications can be said to be the largest potential market for blockchain. In terms of digital currency, China, France, Italy and other countries already have central bank digital currency plans and are implementing them, and Japan and the United States have also begun to put central bank digital on the agenda. Next, the central bank digital currency market will be a battleground for military strategists.
In terms of enterprise-level applications, various applications are also blooming. The main players are Hyperledger, R3, and Enterprise Ethereum, but the technologies they use are all old. For example, Hyperledger used the PBFT algorithm at the beginning, which belongs to the oldest generation of Byzantine fault-tolerant algorithm. In actual development and application, it does not reach the product-level standard at all.
On Hyperledger, if more than 10 nodes are established, the network will become very stuck, and there is no way to meet the requirements of large-scale enterprise applications. And we use the HotStuff consensus algorithm, which can fully support thousands of consensus nodes and massive-level transaction processing, and its complexity is linear, unlike many algorithms that increase in quadratic complexity.
Chain Catcher: Can you describe the technical characteristics of Cypherium in more detail?
Sky Guo: In order to achieve a balance between decentralization and scalability, Cypherium uses the same HotStuff hybrid consensus mechanism as Facebook Libra, but the difference is that LibraBFT developed on this basis is a centralized fixed node consensus algorithm, which the Cypherium team implements The HotStuff algorithm is completely decentralized without permission.
Blockchain consensus is generally divided into two processes, namely, election of verifiers, packaging and verification of blocks. Cypherium adopts PoW consensus in the first process of consensus, which is the stage of electing bookkeepers. Compared with other consensus mechanisms, PoW has better fairness and can better resist witch attacks.
However, PoW is inefficient and cannot meet enterprise-level applications. Therefore, in the second stage, which is the package accounting stage, Cypherium uses the more efficient HotStuff mechanism to package verification blocks, which greatly increases the scalability of the blockchain Sex.
In response to the design of the hybrid consensus mechanism, Cypherium also designed a dual-chain architecture of election chain + transaction chain. The election chain runs the PoW consensus to select the verification committee, and the transaction chain runs HotStuff to improve scalability.
Chain Catcher: Many countries around the world are studying central bank digital currencies. What do you think are the problems? Why is the participation of external infrastructure such as Cypherium needed?
Sky Guo: The development of central bank digital currency is faster than we thought. For example, China’s DCEP and the French central bank’s experiment, but there is no unified standard among them. They all have different purposes. For example, China’s DECP is retail Type CBDC, while the Bank of France and Bank of Thailand are wholesale, so we will know the specific design structure when they are finally launched and put into use.
The central bank digital currency needs a new infrastructure instead of manually keying in CPN information like SWIFT. After all, if the central bank digital currency still uses this system for cross-border transactions, their performance will be bound to the lower-level restrictions of the system, and adopted A new infrastructure can bring out all the benefits of CBDC. In fact, blockchain technology can meet all the requirements of the central bank's digital currency for access, interoperability, accuracy, functionality, transaction speed, and privacy protection design.
Specifically, Cypherium can be applied to two scenarios of central bank digital currency. One is that the payer does not have an account, and the payer uses a specific CBDC to pay to the receiver; the other is that the payer pays the receiver to the other that he accepts. CBDC. These two scenarios are not easy for CBDC, but they must be mutually operable. At this time, Cypherium is characterized by instant transaction settlement and the fastest Byzantine fault-tolerant consensus algorithm that can process thousands of transactions per second can solve the interoperability problem.
Chain Catcher: What specific solutions do you have for central bank digital currencies?
Sky Guo: At present, our digital currency interoperability solution mainly includes two core modules, Cypherium Connect and Cypherium Validator.
Among them, Cypherium Connect has established an information channel for the exchange of KYC/AML, risk control information, handling fees, exchange rates and other payment-related information; CypheriumValidator is a validator. Before the transaction enters the Fed and the blockchain ledger system, it must be It needs to be confirmed by Validation, and its validation rules can be customized according to specific system requirements.
Through a cross-chain framework, Cypherium can provide various mainstream electronic currency mediation services including Libra and central bank digital currencies in real time, connecting banks, payment service providers, digital currency trading platforms and enterprises, and providing a smooth experience for global payments.
We are now also maintaining cooperation with central banks in many countries. For example, members of the US Faster Payments Council initiated by the Federal Reserve. The members mainly include Visa, Wells Fargo, Goldman Sachs, JP Morgan Chase, etc., and only two blockchain companies have joined them, one is Ripple , The other is Cypherium.
02
The enterprise application market needs greater breakthroughs
Chain catcher: At present, Ethereum and Polkadot are in an advantageous position in the public chain competition. If emerging public chains like Cypherium want to overtake a corner, what can they do?
Sky Guo: First of all, we must clarify the direction of our application scenarios. Although Ethereum now has DeFi and stablecoins, it is still far from being applied in real life. The main problem is that they are too focused on technology and are not targeted. Design technical architecture and solutions for urgent problems in a certain industry.
Now many celebrity projects have fallen into an endless loop. They want to do too many things. For example, Ethereum 2.0 is planning to switch to a POS consensus mechanism, but in fact, their own carrying capacity is determined by the original design, and its bottleneck problem Now that it has been exposed, it means that other public chains have a very good opportunity to surpass it. In response to several major problems of Ethereum, including lack of transaction finality, slow confirmation time, lack of practicality, and difficulty for developers to get started, we will solve these problems one by one.
We do not try to make Cypherium all-encompassing, because that will make the system more prone to errors and security vulnerabilities. Our positioning is very clear, including specific application scenarios such as enterprise-level data transmission and storage, decentralized identity, and central bank digital currency interoperability, making us a lightweight protocol, while leaving more complex logic to other levels Processing, this is also the most scientific principle of program architecture design.
Chain Catcher: Understand that a new public chain should pay more attention to the technology itself, find its own suitable segmentation scenarios, and other areas where the public chain is insufficient to develop strength and take root.
Sky Guo: Yes, the first thing is to find your own positioning and application scenarios, and then select the technology on this basis, otherwise this chain is a waste product, no one will use it no matter how good it is.
For example, in the process of designing iPhone for Jobs, first of all, I don’t mean that I look at the current technologies and what is the best. I will stack them, but first find out the inconveniences of the current mobile phones. After the user’s pain points, the iPhone was designed by combining these corresponding technologies.
The current blockchain industry is not like it was in 17 years. A project can survive completely by hype. It is more about competing for future development potential and real landing process.
Chain catcher: If you want to build a public chain with technical barriers, what is the biggest difficulty?
Sky Guo: The particularity of blockchains is that they are all open source software, so technical barriers do not actually exist. If you want to build a public chain that others cannot replicate, the most important thing is to have a consensus, such as Bitcoin, which has the largest consensus group in the world. Although the technology is very old, it does not pose any challenges or influences. .
Therefore, if you really want to create a unique public chain that others cannot imitate or challenge, you must reach more community consensus.
Our positioning is not a direct head-to-head with Bitcoin or Ethereum, but a payment system that hopes to become a carrier of corporate infrastructure and central bank digital currency. This is our subdivision, but with great potential.
Chain Catcher: Since it talks about ecology, governance mechanism and economic model design are the difficulties of ecological construction, how do you do economic model design?
Sky Guo: At the incentive level, during the execution of smart contracts and transactions, we will charge Gas fees based on the resources used. The number of tokens will also be issued in a certain proportion each year, but it is not like Bitcoin halving every 4 years. , Because this is likely to cause relatively large fluctuations and affect the long-term willingness of miners to participate.
In terms of governance model, miners have governance rights over the protocol layer, such as some underlying parameters, block size, and how many blocks are processed per minute. Miners can vote to determine the governance logic of the protocol layer. Developers participate together.
Chain Catcher: Do you have any substantial progress in enterprise-level commercial applications that you can share?
Sky Guo: Of course, the key to the success or failure of Cypherium lies in whether it can be recognized by the company, take root in the TO B market, and continue to expand its application scenarios. Randstad, one of the largest human resources companies in the world, has reached a cooperation with us and is using a combination of Cypherium network and Google Cloud to effectively match the supply and demand relationship between talents and enterprises.
In the past, Randstad used human means to verify customer qualifications, which may take several months. After using the Cypherium blockchain, Randstad hopes to complete the verification instantly through official sources. It will be able to do this through digital signature technology, while maintaining privacy for Randstad’s customers and employees, and the authority can publish the hash value of the digital certificate on the Cypherium public chain, which allows Randstad to verify without collecting user data Information, such as whether the user has a driver’s license.
Chain catcher: Nowadays, the public chain market is becoming more and more competitive. How do you see the future industry development trend? What development plan does Cypherium have?
Sky Guo: We believe that the next era will not be when a certain public chain is dominated by one family. To paraphrase a popular saying, there is no era of Ethereum, there is only Ethereum in the era.
With the participation of large players such as Libra, we can see that the market's demand for public chains is increasing. This also shows that more public chains will appear to adapt to different demand scenarios. At present, there are only a handful of projects that can meet the technology and performance requirements of the next-generation blockchain, and the market is facing a huge vacancy. Cypherium has already cooperated with many government agencies, enterprises and academic institutions, and will improve and expand the ecosystem through more killer applications and developer communities.
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