Hey readers,

Exciting news! We’ve launched a brand new blog directly on our D’CENT Wallet website.

💠 English: https://store.dcentwallet.com/blogs/post

💠 Korean: https://store-kr.dcentwallet.com/blogs/post

💠 Japanese: https://store.dcentwallet.com/ja-jp/blogs/post

We’ve made this move to provide you with a more organized and improved experience. On our website blog, you’ll enjoy a more streamlined experience with faster loading times and exclusive content you won’t find anywhere else.

This isn’t just about D’CENT Wallet updates anymore. We’re diving deeper into the world of blockchain with informative articles, analysis, and explorations of projects and protocols.

Don’t miss out!

The D’CENT Team

D’CENT Blog Moves Home! Get In-Depth Blockchain Content was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

TL;DR:

DePIN is a network of physical infrastructure incentivized by tokens, a sector that has been highly anticipated since the early days of blockchain technology. By forming a decentralized network between protocol makers, resource providers, and consumers, and through token economics, it can gain momentum and compete with centralized infrastructure. By providing rewards for the roles of participants within the network, DePIN can compete with existing centralized infrastructure by offering better scalability, cost-effectiveness, and security. While there are still many challenges to be addressed, it is a sector that is growing rapidly with the introduction of AI and is worth noting as a sector with significant value.

Background

Blockchain is changing the paradigm of the existing IT industry through a flywheel that creates explosive growth based on incentives for participants’ contributions. While the contributions of participants have mainly been security or liquidity provision for decentralization in the past, the blockchain world that will unfold in the future is where participants who provide specific resources can be rewarded. This is not limited to software. Someone will provide data storage and be rewarded, someone will provide idle computing devices and be rewarded, and it can include many of the physical infrastructures we need in our daily lives. An infrastructure in which resources are formed in a decentralized manner, from providers to consumers, is called DePIN.

As we live, we use various essential infrastructures such as energy, data, and wireless networks, and it is undeniable that most of the work of providing and managing these infrastructures is under the control of central governments or private companies. Centralized infrastructure can lead to increased costs due to monopoly, limitations of scalability and transparency, and decreased resource efficiency. Of course, it cannot be said that centralized infrastructure is unconditionally bad, but the monopoly of infrastructure providers who have long been victorious in competition can ultimately lead to increased costs for consumers and lose motivation to expand for the greater public good. However, now we have the opportunity to form an infrastructure that is not provided by a single entity, but is created by participants and operated by token incentives.

DePIN stands for Decentralized Physical Infrastructure Network. The term itself is not familiar, but similar sectors already existed in blockchain. There was a need for consensus on terms such as EdgeFi, PoPw (Proof of Physical Work), and TIPN (Token Incentivized Physical Networks) that were used in similar meanings in the past, and the term DePIN was used by Messari and is being agreed upon as a word to refer to this sector. Messari also said that it will be one of the most important areas of cryptocurrency investment in the next 10 years.

Growth Momentum

In order for the infrastructure to be formed in accordance with the meaning of DePIN, (1) construction and maintenance of the physical environment (2) off-chain computing environment (3) blockchain architecture (4) token incentives are required.

Unlike general decentralized networks, it is a network that is not just a software network, but is associated with actual physical environments and each item is harmonized. For example, if a computing environment is required, it refers to the physical environment required for data collected from physical devices (e.g., sensors) or a high-performance computing network for this, and large-capacity data storage. The token incentive model is a model of how to reward contributors who have provided the resources needed to build and maintain the physical environment.

When each element is met for its purpose, the growth foundation of DePIN is laid. The protocols and token incentives required to build DePIN provide a springboard for attracting the contributors needed to form the infrastructure. Providers who can contribute the resources needed for the infrastructure can be rewarded for their contributions to the initial infrastructure building, leading to a bootstrap process for competition with centralized infrastructure. If the infrastructure grows, more investors will participate, and if the ecosystem grows and can attract more users, it can continue to grow positively. In this flow, DePIN can directly compete with existing centralized and monopolistic infrastructures, and can absorb various advantages that existing infrastructures do not have and evolve into a better network.

Why DePIN Can Be Better

DePIN is a network composed of participants who provide resources based on token rewards and receive incentives for this. What is the difference between this and the existing centralized physical infrastructure?

The first is high scalability through open infrastructure formation. In the infrastructure led by governments or private companies, specific companies that have won the competition use their strong position through monopoly to intentionally limit scalability for cost efficiency or lose motivation to provide wider infrastructure. However, DePIN is composed of resource providers who have no restrictions on participation, so it has the potential to lead to greater scalability as it grows due to the effect of attracting more participants.

The second is that specific entities do not adjust prices under monopoly and can provide resources to consumers at reasonable prices. Many of the computing and data storage currently available are provided by a few top companies and have high adoption rates. Consumers cannot influence pricing decisions, and some find it difficult to use resources as efficiently as they consume. On the other hand, computing or storage provided in a decentralized environment can leverage community governance to make reasonable and participatory decisions. Compared to the centralized approach that requires large-scale processing, users can experience a much cheaper way of managing and maintaining costs. As a result, consumers can utilize the infrastructure at a lower price compared to existing infrastructure.

For this to happen, the token economic model of the protocol provider needs to be reliable, and this is a key area to be validated for DePIN to be adopted in real life. These advantages are possible because DePIN utilizes blockchain, which guarantees immutability and tamper-proof features. All participants in DePIN, including protocol providers, resource providers, consumers, nodes and devices that make up the infrastructure, can be expanded into a single ID industry within the blockchain. In other words, this means that there is a possibility that many of the existing physical infrastructure industries in the IT industry will be reorganized in the process of realizing the current vision of DePIN. For example, the energy grid and the IT industry have different device identification IDs and data, but in DePIN, these two different domains can operate on a single network. As these domains converge, new market opportunities may arise due to the diversification of resource providers and the creation of a huge network.

Notable Projects

DePIN includes various protocols for different purposes, with projects providing sensors, wireless networks, and data storage for physical infrastructure. Networks that connect directly to clients instead of traditional cloud (server) environments offer token incentives tailored to their specific purposes. Here are some of the currently highlighted key projects:

Arweave: Arweave is a decentralized storage network known for its low-cost storage, similar to the well-known storage network Filecoin. It maintains storage space by providing token rewards to providers. AR, the reward token for the Arweave decentralized permanent storage network, is provided as an incentive to resource providers based on the amount of data stored and access frequency.

Livepeer: Livepeer is a live video transcoding application. It is a protocol that enables the creation of smooth and fast video streaming services without intermediaries and at no cost. LPT is used as a reward for resource providers (CPU, GPU, and bandwidth) called orchestrators, and can also be partially acquired when broadcasters pay fees to the network. This method is simply called video mining.

Ocean: Ocean Protocol is a project that tokenizes data, which is the core of AI, and enables trading in a marketplace. The protocol implements blockchain-based data sharing and introduces a whitelist system called TCR (token curated registry) to participate as a market maker for long-term data monetization, thereby enhancing the reliability of data for use in AI. It also supports the tokenization of data and algorithms through the Ocean Market, and consumers can purchase access rights to data or algorithms.

Helium: Helium, widely known as a decentralized wireless network project, promotes the construction of environments by providing token incentives to providers to address the cost limitations of existing IoT device infrastructure. It is further expanding into the 5G and WiFi market, and is accelerating the construction of large-scale IoT environments using LoRaWAN technology, a network technology with low power consumption and long transmission distance. While it has shown slow growth for a while due to regulatory issues and market cap limitations, it is currently one of the most successful projects in building physical infrastructure.

Render: Render Network, a distributed GPU rendering platform, is one of the projects that has benefited most from the adoption of AI. Render provides rendering services based on high-performance computing power through a decentralized network, emphasizing the efficient utilization of idle GPU resources. It also improves the efficiency of computing tasks through efficient two-way market matching.

Conclusion

DePIN has been a topic of discussion since the early days of blockchain technology. The DePIN ecosystem, established as a conceptual term by Messari in 2022, is gradually growing. In particular, the recent growth of AI is expected to be a catalyst for DePIN growth, leading to an explosion in demand. However, DePIN is not an industry solely composed of software, so it cannot grow as fast as the general crypto industry. Additionally, the transition from an environment monitored and operated by existing governments or private companies to a decentralized one requires new regulations, and there are still many uncertain factors. Nevertheless, with blockchain expected to change many environments in the transition to a new internet, there is enough reason to pay close attention to DePIN in the future.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

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Disclaimer:
This blog is for educational purposes only. Information presented here, including projects or brands mentioned, is informative and not financial, legal, or tax advice. While we strive for accuracy, we cannot be held liable for any inaccuracies. Cryptocurrencies are inherently risky. Do your own thorough research and consider consulting a financial advisor for investment decisions aligned with your goals and risk tolerance. External links may be present and we are not responsible for their content or practices. Review their terms of service and privacy policies.

DePIN, a New Era of Physical Infrastructure Making was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

TL;DR

• The NFT holder concentration is a crucial metric determining integrity and investment stability.
• The holder concentration of the top 5 NFT collections is generally low, dispersed among diverse holders.
• Using HHI, one can calculate and track the holder concentration in the NFT market over time.
• The NFT market is susceptible to rapid HHI fluctuations, necessitating ongoing monitoring.
• To hold NFTs securely, considering the holder concentration is vital, with HHI aiding in evaluation.

Introduction

Ethereum stands out at the most popular platform among blockchains supporting smart contracts. In particular, Ethereum-based NFT contracts play a crucial role in redefining digital asset ownership.

The NFT holder concentration reveals whether a small number of holders possess an excessive amount of NFTs. It serves as a crucial investment metric associated with the integrity of the NFT community and the stability of NFT investments. If a small number of holders possess a majority of NFTs, it can expose the market to price distortion and volatility. Conversely, if a diverse group of holders owns NFTs evenly, it can help maintain market price stability. Therefore, understanding the extent to which each NFT is distributed among holders is essential for the healthy growth of the NFT market.

Introduction to Top 5 NFT Collections

Here are the top 5 Ethereum-based ERC-721 NFT collections in terms of the trading volume in USD over the past year.

Ethereum Mainnet ERC-721 Transfer Events emitted (Excluding L2) since April 2023, excluding wash tradings.

Bored Ape Yacht Club

A unique collection of digital ape artwork, each featuring unique artwork created by individual artists.

Mutant Ape Yacht Club

A derivative project of the Bored Ape Yacht Club, also featuring a unique collection of digital ape artwork.

Azuki

An NFT collection based on Japanese miniature art, offering a variety of artwork.

Pudgy Penguins

A collection featuring unique penguin characters as motifs.

DeGods

A diverse collection of unique PFPs (Profile Pictures) with a distinctive style.

Concentration Calculation Method: Herfindahl-Hirschman Index (HHI)

The Herfindahl-Hirschman Index (HHI) is one of the key metrics in econometrics used to measure the level of competition in a market. This index evaluates how concentrated a market is based on the market share of each entity within a specific market, such as companies or individuals.

HHI is calculated by summing the squares of the market shares held by each entity in the market. For example, if four companies have market shares of 30%, 30%, 20%, and 20% respectively, the HHI would be 0.26 (0.09 + 0.09 + 0.04 + 0.04 = 0.26).

https://en.wikipedia.org/wiki/Herfindahl–Hirschman_index

As the number of entities in the market increases and their market shares are distributed evenly, the HHI approaches 0. Conversely, if one entity dominates the market, the HHI approaches 1. According to the Horizontal Merger Guidelines of the United States Department of Justice, market concentration is evaluated based on the following HHI values:

• HHI < 0.15: Unconcentrated Markets
• 0.15 ≤ HHI ≤ 0.25: Moderately Concentrated Markets
• 0.25 < HHI: Highly Concentrated Markets

Now, let’s use this as a benchmark to evaluate the concentration of holders in the top 5 NFT collections.

Analysis of HHI for Top 5 NFT Collections

Let’s now analyze the concentration of holders for each NFT collection using the HHI. First, Let me introduce you to the basic method of calculating holder concentration through the following two cases.

Method for Calculating Holder Concentration

Case 1) High Holder Concentration

The table above represents a case with high holder concentration. The distribution of NFT holdings among holders is uneven.

HHI = 0.49 + 0.04 + 0.01 = 0.54

Case 2) Low Holder Concentration

The table above represents a case with low holder concentration. The NFT holdings among holders are relatively balanced.

HHI = 0.09 + 0.09 + 0.04 + 0.04 = 0.26

Current HHI Values

As of April 2024, the HHI for the top NFT collections is as follows. All HHIs are below 0.15, indicating a relatively low holder concentration. Therefore, it can be evaluated that there are many NFT holders, and the tokens are evenly distributed without being biased towards specific holders.

HHI Trends (Comparison with Benchmarks)

As with all other markets, the HHI can fluctuate continuously over time. This is because NFT trading, minting, burning, airdrops, and other factors can lead to changes in the holders of each token and the number of NFTs held by each holder. Now let’s examine the HHI trends of each NFT collection from early 2023 to April 2024.

Most NFT collections have had an HHI much lower than 0.15 from January 2023 to the present, suggesting that there hasn’t been a critical impact in terms of market concentration. However, in the case of DeGods, its HHI was above 0.25 until May 2023, indicating a highly concentrated market, and it remained above 0.15 until July 2023, indicating a moderately concentrated market. Therefore, in 2023, DeGods used to have a high level of concentration with only a few holders owning NFTs, but over time, as the community grew, the concentration naturally decreased to within normal ranges.

HHI Trends (Microscopic View)

This time, let’s examine the HHI trend of each NFT collection more closely without comparing it to benchmarks.

The HHI trend shows a unique pattern, often exhibiting sharp increases or decreases at specific points in time. This is because, unlike traditional markets, NFT collections are prone to significant minting and burning events or panic selling and buying, leading to rapid fluctuations in the NFT economy. Therefore, even if the HHI is very low at the current moment, it could sharply rise to become a concentrated market at any time. Thus, continuously monitoring the HHI indicator is crucial.

Conclusion

When purchasing NFTs, many people only consider factors such as the NFT’s story, artistic value, community size, and floor price. However, NFTs are assets with very low liquidity, similar to real estate and artworks, making it difficult to establish a clear exit plan and potentially resulting in significant losses during the selling process. While checking trading volume trends can be helpful, it can also be challenging to make judgments excluding falser information such as wash trading, and the market can be subject to sudden fluctuations due to specific whale holders, leading to significant economic impacts.

Therefore, when aiming to hold NFTs for the long term, it’s crucial to evaluate the concentration of holders, and the HHI serves as a significant measure for such evaluations. I hope that by carefully examining the HHI through on-chain data, it will aid in making data-driven decisions when purchasing NFTs.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

X (Twitter) | Facebook | LinkedIn | CoinMarketCap

Disclaimer:
This blog is for educational purposes only. Information presented here, including projects or brands mentioned, is informative and not financial, legal, or tax advice. While we strive for accuracy, we cannot be held liable for any inaccuracies. Cryptocurrencies are inherently risky. Do your own thorough research and consider consulting a financial advisor for investment decisions aligned with your goals and risk tolerance. External links may be present and we are not responsible for their content or practices. Review their terms of service and privacy policies.

On-chain Data for Successful NFT Investment: Analysis of NFT Holder Concentration was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

Exciting news for all ASTR token holders and DeFi enthusiasts! D’CENT Wallet is thrilled to announce our integration with Astar Portal, the one-stop platform for interacting with the Astar Network. This powerful partnership opens up a world of opportunity for stakers, allowing you to securely stake your ASTR tokens directly from your D’CENT Wallet and actively participate in Astar’s thriving dApp ecosystem.

TL;DR:

✅D’CENT Wallet integrates with Astar Portal for easier and safer ASTR token staking.

✅Participate in Astar’s dApp ecosystem directly from your D’CENT Wallet.

✅”Cold staking to Astar dApps” feature allows secure staking with tokens remaining in your cold wallet.

✅D’CENT Wallet offers efficient reward claiming, saving you time and money.

✅This partnership empowers users to contribute to DeFi’s future while earning rewards.

Stake Your ASTR Directly from Your D’CENT Wallet with Enhanced Security

Security is paramount when it comes to your cryptocurrency holdings. With D’CENT Wallet integration, you can leverage the industry-leading security of our platform to stake your ASTR tokens. Highly secure biometric authentication and impenetrable offline storage of the D’CENT Biometric Wallet provide an extra layer of peace of mind. We’re calling this innovative feature “cold staking to Astar dApps”, allowing you to earn staking rewards while your tokens remain safely isolated in your cold wallet.

Seamless Connection to Astar Portal dApp Staking and Streamlined Reward Claiming

D’CENT Wallet offers a streamlined user experience for participating in Astar’s dApp staking program. Simply connect your Astar wallet(s) created within D’CENT Wallet to the Astar Portal directly. No need to manage separate wallets or navigate complex interfaces. With a few clicks, you’ll be ready to explore the diverse range of dApps on Astar Network and choose the projects you want to support.

But wait, there’s more!

D’CENT Wallet goes beyond just secure storage and a smooth user experience. When it comes to claiming your ASTR staking rewards, D’CENT Wallet offers a significant advantage over other hardware wallets.

Here’s what sets us apart:

Simplified and Efficient Reward Claiming: Unlike the other hardware wallet that requires frequent interaction to claim rewards, D’CENT Biometric Wallet allows you to claim a larger batch of rewards at once. This reduces the number of transactions required and minimizes associated fees, saving you time and money.

Industry-Leading Security: Enjoy peace of mind while staking with features like biometric authentication and secure offline storage.

Seamless User Experience: Connect your D’CENT Astar wallet(s) directly to Astar Portal for a smooth staking experience.

Support for Astar’s dApp Staking: Participate in the latest iteration of Astar’s dApp staking program.

Fuel Astar’s Thriving dApp Ecosystem

While this article focuses on the core benefits of using D’CENT Wallet for Astar dApp Staking, we understand you might have questions about the specific dApps available, including potentially staking on our own D’CENT dApp (listed on Astar Portal).

Please check out our D’CENT dApp listed on Astar Portal here: https://portal.astar.network/astar/dapp-staking/dapp?dapp=0x49c321e734b9e431fb4dabbe406859cf11f0c3b6

To delve deeper and learn how to stake your ASTR tokens on Astar dApps, we recommend checking out a separate, comprehensive guide from D’CENT. This guide will provide step-by-step instructions to ensure a smooth and successful staking experience. 👇

https://store.dcentwallet.com/blogs/post/unlock-the-power-of-cold-staking-stake-astr-on-astar-portal-with-dcent

Conclusion: A Powerful Partnership for Stakers and the Future of DeFi

The integration of D’CENT Wallet with Astar Portal marks a significant step forward for stakers seeking a secure, convenient, and rewarding way to participate in the Astar Network. With D’CENT’s industry-leading security, efficient reward claiming, and Astar’s innovative dApp ecosystem, this partnership empowers you to actively contribute to the future of DeFi while earning attractive rewards.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

X (Twitter) | Facebook | LinkedIn | CoinMarketCap

Disclaimer:
This blog is for educational purposes only. Information presented here, including projects or brands mentioned, is informative and not financial, legal, or tax advice. While we strive for accuracy, we cannot be held liable for any inaccuracies. Cryptocurrencies are inherently risky. Do your own thorough research and consider consulting a financial advisor for investment decisions aligned with your goals and risk tolerance. External links may be present and we are not responsible for their content or practices. Review their terms of service and privacy policies.

Cold Staking Made Simple and Secure: D’CENT Wallet Integrates with Astar Portal! was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

TL;DR:

✅Algorand has drawn attention with its Pure PoS-based blockchain that emphasizes finality.

✅The 2024 Algorand roadmap has been released, with plans to become more developer-friendly and future-oriented.

✅The roadmap includes upgrades such as AlgoKit 2.0 for developer onboarding, network performance improvements, and the introduction of incentives.

✅2024 is a critical watershed year for Algorand as it prepares for mass adoption of web3 and explosive ecosystem growth.

Algorand Integration

D’CENT Wallet goes beyond typical crypto wallets, offering a secure and user-friendly hub for managing your digital assets, with a strong emphasis on Algorand. Our innovative D’CENT Biometric Hardware Wallet sets the standard for offline crypto security, perfectly safeguarding your Algorand (ALGO) holdings.

(October 19th, 2023) Algorand integration announcement

Algorand Overview

Remember the days when blockchain transactions felt slower than dial-up internet? That’s because blockchains faced a major hurdle: the scalability trilemma. This meant they could only excel in two of these three areas:

• Security: Resistance to hacking and attacks.
• Scalability: Ability to handle a large number of transactions quickly.
• Decentralization: No single entity controlling the network.

With slow transaction speeds plaguing existing blockchains, a race for the next generation emerged. This “3rd generation blockchain” competition aimed to overcome the scalability trilemma, balancing security, speed, and decentralization.

Algorand, founded by the prestigious MIT professor and Turing Award winner Silvio Micali, entered this arena with a unique approach. Their solution leverages a novel consensus mechanism based on Verifiable Random Functions (VRF) to achieve this holy grail of blockchain: scalability without sacrificing security or decentralization.

Algorand’s blazing-fast transaction speeds and guaranteed finality have set it apart. Building on this foundation, Algorand is forging new partnerships (countries, institutions, schools) and undergoing a strategic shift. Their focus? Becoming the go-to platform for developers, whom they call “builders.” Get ready to see Algorand take another leap forward in 2024, this time as a developer-centric powerhouse.

Pure Proof of Stake: A More Accessible Consensus Mechanism

Algorand tackles a key challenge in blockchain technology: making participation in consensus mechanisms more accessible. Unlike traditional Proof of Stake (PoS) systems, which can have high entry barriers (like requiring 32 ETH in Ethereum), Pure PoS aims to lower these costs.

Let’s break down the problems Pure PoS solves and how it aims to strike a balance between them, offering a more accessible and secure consensus mechanism:

• High Entry Costs in PoS: Many PoS systems require a significant initial stake to participate, limiting accessibility.
• Centralized Block Production: Replacing Proof of Work with a single, centralized block producer might seem faster, but it introduces major security risks.
• Decentralized Block Producer Selection: Choosing a small group of decentralized block producers can still be fast, but the selection process itself can be complex and vulnerable to attack.

Imagine a system where anyone can participate, but only a select few are chosen at random to generate blocks. Crucially, this selection happens without attackers knowing who will be chosen, preventing them from targeting specific nodes. This is the core idea behind Algorand’s Pure PoS. The process unfolds in three key steps, a multi-layered approach with random selection at each step strengthens security in Pure PoS:

• Random Block Proposal: Verifiable Random Function (VRF) randomly selects a node to propose the next block. This eliminates the possibility of attackers knowing who to target or bribe beforehand.
• Soft Vote: Even with random selection, Algorand adds another layer of security. A randomly chosen committee “soft votes” on the proposed block. If there are competing proposals, the block with the lowest VRF hash value wins.
• Certify Vote: Finally, a separate randomly chosen committee conducts a “certify vote” to verify the proposed block for issues like double-spending. Only after passing these checks is the block added to the ledger.

Algorand’s Pure Proof of Stake leverages a large number of honest users to overpower a smaller number of malicious actors. This security is bolstered by using Verifiable Random Function (VRF) throughout the process. VRF helps reduce the potential for malicious interference and protects against hacker threats. One of the key benefits of Pure PoS is finality. Unlike other consensus mechanisms where blocks can be reversed, delaying finality, Algorand achieves fast finality. This means transactions are irreversible almost instantly, preventing forks (reversals) and ensuring a clear record of transactions.

Algorand’s Pure PoS system stands out with its lack of direct rewards for block generation. This eliminates a high entry barrier for participation. Anyone holding Algorand can join, with the amount of ALGO held influencing the chance of VRF selection (similar to Proof of Stake). This design offers several advantages:

• Increased Security: A larger pool of participants, facilitated by the low barrier to entry, dilutes the influence of malicious actors.
• Enhanced Decentralization: Anyone can participate, promoting a more decentralized network.

Algorand’s Pure PoS system distinguishes between two types of nodes:

• Participation Nodes: Anyone can become one of these and propose blocks.
• Relay Nodes: Managed by the foundation, these nodes broadcast data across the entire network.

While Pure PoS itself is resistant to internal attacks, relay nodes could be targeted externally to disrupt data transmission. Therefore, the foundation directly selects reliable nodes for this critical role.

Algorand’s 2024 Gambit: Embracing Change for Growth

The Algorand Foundation has unveiled “The Algorand Gambit,” a roadmap charting the network’s course for 2024. This plan prioritizes fostering a thriving ecosystem while preserving Algorand’s core strengths. The name “Gambit” reflects the strategic approach — taking calculated risks for potential gains, acknowledging the inherent risk associated with change. Let’s explore some of the key changes on the horizon:

Building a Thriving Ecosystem: Focus on Developers

Algorand recognizes that attracting developers, referred to as “builders,” is crucial for the success of any major blockchain network. In the past, a large user base was enough for some platforms. However, now, mainnets need to grow alongside builders who bridge the gap between the network and end-users. This shift requires a multi-pronged approach:

• Onboarding Developers: Attracting and welcoming new developers to the platform.
• User-Friendly Tools: Providing accessible development tools that simplify building decentralized applications (dApps).
• Seamless Deployment & Testing: Creating an environment where developers can easily deploy and test their dApps.

Ultimately, a robust ecosystem with a strong developer base and innovative dApps is essential for Algorand’s mass adoption.

AlgoKit 2.0: Streamlining dApp Development for Onboarding Developers

To attract a larger pool of developers, Algorand is introducing AlgoKit 2.0. Building upon its predecessor, AlgoKit 2.0 aims to simplify dApp development with a suite of user-friendly tools.

Here’s how AlgoKit 2.0 (including the anticipated Lui Lopez upgrade) tackles this challenge:

• Familiar Languages: Developers can leverage existing knowledge by using popular languages like Python.
• Simplified Onboarding: A streamlined 10-minute onboarding process minimizes the need for in-depth blockchain expertise.
• Comprehensive Toolkit: A rich set of tools encompasses local network and sandbox improvements, debugging tools, and the introduction of unit testing.

These features empower developers to create and test dApps efficiently, fostering a more vibrant developer community for Algorand.

Algorand: A Scalable Solution for the Future

Sicilian Defense upgrade: As technology advances, the once-impenetrable blockchain trilemma is being challenged. Many mainnets are actively innovating and improving their performance. Algorand’s Pure Proof of Stake (Pure PoS) shines with its fast finality. Building on this strength, the network is poised for even greater speed with the Sicilian Defense upgrade. This upgrade introduces dynamic round times, aiming to slash the average round time to under 3 seconds. By dynamically adjusting finality based on network conditions, Sicilian Defense promises to minimize transaction confirmation times.

Queen’s Gambit upgrade: This upgrade (released March 21, 2024) tackles data storage for relay nodes. With growing data demands, storing the entire ledger history can strain resources. Queen’s Gambit introduces “non-archival relays” which allow relay nodes to avoid storing all copies. This significantly reduces costs and improves environmental efficiency.

Capablanca Variation upgrade: This upgrade focuses on network structure. It aims to transition from the current system to a peer-to-peer (P2P) gossip network, similar to Bitcoin. This shift signifies a move towards greater decentralization and could enhance network reliability by reducing dependence on relay nodes.

Shifting Gears: Introducing Incentives

Algorand’s Pure Proof of Stake (Pure PoS) initially omitted separate rewards for participating nodes. This aimed to lower participation barriers and boost decentralization. However, this approach lacked a mechanism to counter sell-off pressure since there was no mandatory lock-up period for holding ALGO tokens.

The Reti upgrade signals a change. It introduces Algorand’s first incentive system. The Algorand Foundation anticipates that offering rewards will attract more nodes (participation nodes) as the potential for rewards increases with the amount of staked ALGO. This, in turn, is expected to strengthen network security and decentralization. Simply put, block producers will now be directly rewarded with Algorand, potentially including a portion of transaction fees.

Conclusion

Algorand was once viewed with concern for its overly technology-centric growth strategy. However, it is now continuously striving to build an ecosystem with a future-oriented vision. 2024 could be a very significant year for Algorand. The blockchain market has yet to achieve mass adoption, and with distinct advantages that other blockchain networks lack, this year is poised to be a turning point for Algorand’s growth.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

X (Twitter) | Facebook | LinkedIn | CoinMarketCap

Disclaimer:
This blog is for educational purposes only. Information presented here, including projects or brands mentioned, is informative and not financial, legal, or tax advice. While we strive for accuracy, we cannot be held liable for any inaccuracies. Cryptocurrencies are inherently risky. Do your own thorough research and consider consulting a financial advisor for investment decisions aligned with your goals and risk tolerance. External links may be present and we are not responsible for their content or practices. Review their terms of service and privacy policies.

Algorand Blasts Off in 2024: Here’s Why You Should Pay Attention was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

TL;DR:

✅In early March 2024, the prices of cryptocurrencies, including Bitcoin, surged, but the on-chain utility of blockchain did not show significant changes accordingly.

✅This indicates that, apart from the market price surge, the appeal of dApps within the blockchains has not significantly improved.

✅If more diverse and appealing dApps emerge, the blockchain fundamentals could receive much higher evaluations than the current levels.

Introduction

In early March 2024, the price of Bitcoin hit an all-time high. This surge is attributed to factors such as the enthusiasm in investments in Bitcoin exchange-traded funds (ETFs) listed on the US stock market, stabilization of interest rates by the US Federal Reserve, and the upcoming Bitcoin mining reward halving.

As depicted in Figure 1, this bullish trend extended to most other cryptocurrencies, indicating a general enthusiasm in the cryptocurrency market. However, alongside this price surge, did the actual on-chain utility of blockchain also increase? This article will examine the “app infrastructure” utility of Ethereum and other major EVM-compatible blockchains supported by the D’CENT Wallet, analyzing Stickiness and Retention metrics.

Two Key Metrics Showing App Engagement: Stickiness and Retention

Various dApps operate within Ethereum and other major EVM-compatible blockchains. Through Stickiness and Retention, which indicate network activity, we will examine how effectively dApps within each network engage their respective account holders.

Definition of Metrics

Stickiness is a metric that indicates how engaged users are with a particular app. It can be calculated using combinations of number of active users over different periods such as DAU÷MAU, DAU÷WAU, and WAU÷MAU, each with the following mathematical interpretations:

DAU÷MAU: The ratio of users who have activated the network at least once a day over the past month.

DAU÷WAU: The ratio of users who have activated the network at least once a day over the past week.

WAU÷MAU: The ratio of users who have activated the network at least once a week over the past month.

Retention, on the other hand, is a metric that indicates whether users continue to use an app rather than simply visiting it once. Cohort retention, particularly, groups users based on their initial usage date and analyzes the retention changes within each group over time. This allows us to assess the fluctuations in retention over time.

Stickiness Analysis Results

Despite the sharp increase in market prices, the Stickiness of most blockchains showed no significant changes as shown in Figure 2. In other words, even with the market price surge, there was no notable shift in the attractiveness of dApps within each blockchain.

In particular, Polygon stands out as the only case where Stickiness has sharply increased since early 2024, as shown in Figure 3. However, this may need to be considered in light of the possibility of noise generated by specific contract calls.

Upon examining the scale of transactions based on the number of unique addresses that executed transactions, it was discovered that there was a significant increase primarily in the usage of one single specific ERC-721 contract, as shown in Figure 4. Therefore, this surge appears to be rooted in the reliance on a specific contract, and it may not be generalized as an overall increase in the attractiveness of dApps within the Polygon blockchain.

Retention Analysis Results

Similarly, in the case of Weekly Cohort Retention, there were no significant changes observed across all the blockchains as shown in Figure 5. In other words, it is challenging to interpret the sustained frequency of usage among newly created addresses as an improvement following the increase in market prices.

Conclusion

Despite the significant increase in cryptocurrency market prices driven by factors such as the enthusiasm for Bitcoin ETF investments, the Federal Reserve’s interest rate freeze, and the upcoming Bitcoin halving, Ethereum and other major EVM-compatible blockchains have yet to establish a strong position as “app infrastructures.”

Among the various factors influencing the price of governance tokens, the most crucial aspect is the steady increase in demand for executing smart contracts as fuel. Therefore, in addition to investment market indicators, it is essential to assess the emergence and growth of dApps and whether blockchain networks are providing stable infrastructures for them. With the advancement of blockchain technology and mass adoption, the emergence of more diverse and active dApps is expected to significantly increase the utilization of blockchain infrastructures. Evaluating this utilization will be crucial, and Stickiness and Retention metrics will play an important role in this assessment.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

X (Twitter) | Facebook | LinkedIn | CoinMarketCap

After March 2024 Crypto Surge, Did On-Chain Utility Improve? was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

Imagine you own a high-security vault filled with gold. This vault represents your cryptocurrency holdings on a blockchain network like Ethereum. To keep this vault secure, the network relies on a group of guardians called validators. These guardians, similar to security guards at a bank, constantly verify transactions and ensure the network runs smoothly.

In return for their service, validators earn rewards in the form of new cryptocurrency. This process of locking up your crypto to secure a network and earn rewards is called staking. But what if there was a way to put your staked crypto to work even harder? That’s where EigenLayer and restaking come in.

Think of traditional staking like hiring a security guard for your vault. They do a great job, but the vault itself remains inactive. Your gold sits there, not generating any additional value. This is similar to how staking works today. Your crypto is locked up, securing the network, but it’s not actively being used for other purposes.

TL;DR:

✅ Traditional Staking: Lock your crypto to secure a blockchain and earn rewards, but your crypto remains inactive.

✅ EigenLayer: Imagine a network of beehives (AVSs) leveraging your staked crypto (honey) for various tasks within the blockchain.

✅ Restaking: You can “re-use” your staked crypto to secure these AVSs, potentially earning even more rewards.

✅ Benefits: Increased earning potential, enhanced security, faster transactions, and a more dynamic blockchain ecosystem.

✅ Future: A wider variety of AVSs, stronger security, solutions for scalability, and a breeding ground for innovation.

Introducing EigenLayer: The Busy Beehive

Throughout this article, I’ll be using the analogy of beehives and bees to explain EigenLayer for a clearer understanding of how it works.

EigenLayer is a new concept in the crypto world that acts like a busy beehive for your staked crypto. Imagine instead of a single vault, you have a network of beehives. These beehives (called Actively Validated Services or AVSs) can leverage the security provided by your staked crypto (like honey) for various tasks.

Here’s the key difference: While your staked crypto originally secured just one vault (the main blockchain network), with EigenLayer, it can now help secure and validate activities within these beehives (AVSs) as well. In return for this extra work, you can potentially earn additional rewards on top of your regular staking rewards.

Think of AVSs Like Specialized Honeycomb Tasks:

These AVSs can handle various tasks on the blockchain, like:

• Fast-tracking transactions: Imagine verifying a purchase instead of waiting for hours. AVSs can help speed up certain transactions on the blockchain.
• Validating new projects: New blockchain applications can leverage EigenLayer to ensure their security without needing to build everything from scratch.
• Connecting different blockchains: EigenLayer can act as a bridge between different blockchains, allowing them to communicate and exchange information more easily.

By participating in these AVSs through EigenLayer, your staked crypto becomes more like a busy bee, actively contributing to the entire blockchain ecosystem and potentially earning you more rewards.

Restaking: Putting Your Honey Back to Work

Now, here’s the magic trick: EigenLayer allows you to “restake” your existing staked crypto. This means you’re taking the security provided by your staked crypto and using it to secure these AVSs as well. It’s like taking some of the honey produced by your bees and using it to fuel their work in other beehives.

Here’s a breakdown of the process:

1. You stake your crypto on the Ethereum network. This is like placing your gold in the vault and hiring a security guard.

2. EigenLayer comes along and offers its beehive (AVS) services. These AVSs need the security your staked crypto provides (like honey).

3. You choose to restake your crypto with EigenLayer. This is like taking some of your honey and using it to help the bees in the AVS.

4. Your restaked crypto helps secure the AVS. This allows the AVS to function and potentially earn additional rewards.

5. You, in turn, might earn a share of the rewards generated by the AVS. This is like collecting even more honey from your busy bees!

The Benefits of EigenLayer and Restaking:

• Increased Earning Potential: By restaking your crypto, you can potentially earn additional rewards on top of your regular staking rewards.
• Enhanced Security: EigenLayer leverages the combined security of multiple validators, potentially making the overall network more secure.
• Boosted Scalability: AVSs can help handle more transactions and applications on the blockchain, leading to faster and more efficient operations.
• Promotes Innovation: EigenLayer opens doors for new blockchain applications and services to be built more easily.

The Future is a Buzz with Possibilities

EigenLayer and restaking represent a significant leap forward in the world of blockchain technology. While EigenLayer holds immense potential, it’s still in its early stages. Just like a young beehive, it will take time for EigenLayer to mature and reach its full potential. Here’s a glimpse into what the future might hold:

• More Diverse AVSs: As EigenLayer evolves, we can expect a wider variety of AVSs to emerge, catering to various needs within the blockchain ecosystem. Imagine beehives specializing in tasks like secure data storage, lightning-fast payments, or even confidential identity verification. This diversification will create a more dynamic and versatile blockchain landscape.
• Enhanced Security: With EigenLayer, the security of the network isn’t solely reliant on a single layer of validators. Instead, the combined security provided by multiple validators and restaked crypto across various AVSs can significantly enhance the overall network resilience. This distributed approach makes the entire system more robust against potential attacks.
• Faster and More Scalable Blockchains: Traditional blockchains often struggle with handling a high volume of transactions, leading to slow processing times. AVSs can play a crucial role in solving this scalability challenge. By offloading specific tasks to specialized beehives, the main blockchain network can operate more efficiently, leading to faster transaction processing and a smoother user experience.
• A More Dynamic Blockchain Ecosystem: EigenLayer fosters a more open and permissionless environment for innovation. This means anyone with a creative idea can build new blockchain applications and services on top of EigenLayer, similar to how bees build new honeycombs within the hive. This open approach can pave the way for entirely new types of decentralized applications (dApps) that were previously unimaginable.

Challenges to consider for the EigenLayer’s future:

• Security Audits and Testing: As with any new technology, thorough security audits and testing are crucial to identify and address potential vulnerabilities in EigenLayer and AVSs. This ensures a secure foundation for the entire ecosystem.
• Maintaining Decentralization: While EigenLayer aims to promote decentralization, it’s essential to remain vigilant against potential centralization risks. This might involve encouraging a healthy distribution of EigenLayer operators and fostering competition among AVSs.
• Standardization and Interoperability: As the number of AVSs grows, establishing clear standards and protocols will be essential. This ensures that different AVSs can work together seamlessly, creating a more interconnected and efficient beehive network.

Conclusion

Overall, EigenLayer presents a transformative vision for the future of blockchain technology. By leveraging the power of restaking and creating a vibrant ecosystem of AVSs, it has the potential to revolutionize the way we interact with and utilize blockchains. As EigenLayer continues to evolve, it’s exciting to imagine the innovative applications and services that will emerge from this busy beehive of creativity.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

X (Twitter) | Facebook | LinkedIn | CoinMarketCap

Disclaimer:
This blog is for educational purposes only. Information presented here, including projects or brands mentioned, is informative and not financial, legal, or tax advice. While we strive for accuracy, we cannot be held liable for any inaccuracies. Cryptocurrencies are inherently risky. Do your own thorough research and consider consulting a financial advisor for investment decisions aligned with your goals and risk tolerance. External links may be present and we are not responsible for their content or practices. Review their terms of service and privacy policies.

EigenLayer and Restaking: Earning More from Your Crypto (The Beginner’s Guide) was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

Imagine the dread of losing your phone, along with access to vital digital assets like passwords, crypto keys, and irreplaceable photos. However, what if there was a solution that allowed you to regain control, even without your phone? Welcome to Decentralized Recovery (DeRec), a groundbreaking approach empowering individuals to reclaim their digital assets.

Introduction to Decentralized Recovery Protocol

Championed by the Algorand Foundation, Swirlds Labs, and the HBAR Foundations, DeRec represents a collaborative effort aimed at simplifying digital asset recovery. This initiative brings together prominent figures in the blockchain sphere to address the complexities associated with securing digital assets. DeRec seeks to enhance the user-friendliness of Web3 applications and drive mainstream adoption.

Core Principles of DeRec

At the heart of DeRec lies its decentralized methodology, a departure from conventional recovery methods. Here’s a simplified breakdown of its functioning:

Secret Splitting: DeRec employs cryptography to divide a user’s secret key (akin to a master password) into multiple fragments, akin to splitting a treasure map. This approach eliminates single points of vulnerability, thus bolstering overall data security.

Trusted Helpers: Users select trusted individuals — be they friends, family, or any other trusted party — to securely store these key fragments, effectively acting as helpers of their digital assets.

Recovery on Demand: In the event of a lost or stolen device, users can contact a predefined number of their chosen helpers, as stipulated by the DeRec protocol.

Key Reassembly: Helpers provide their key fragments, allowing the DeRec app on a new device to rebuild the key, thereby granting users access to their digital vault once again.

DeRec versus Traditional Recovery Methods

DeRec boasts several advantages over traditional backup methods and other recovery options:

Elimination of Single Point of Failure: By distributing key fragments among trusted helpers, DeRec mitigates the risk of a single point of failure. Even if one fragment is compromised, access to the user’s data remains secure. Unlike traditional backups susceptible to loss or hacking, DeRec disperses key fragments, significantly reducing the likelihood of unauthorized access to the user’s information.

Enhanced Usability: Unlike cumbersome traditional backups, DeRec is designed for universal accessibility, featuring a user-friendly interface for selecting helpers and managing recovery processes. DeRec prioritizes user-friendliness, allowing individuals to delegate the complexity of securing their digital assets to the app, thus requiring minimal technical expertise.

Versatility Across Data Types: While traditional recovery methods may be restricted to specific data types, such as email or cryptocurrency wallets, DeRec offers a comprehensive solution capable of safeguarding various forms of digital data, from passwords and login credentials to cherished memories encapsulated in photos and documents.

Establishment of the DeRec Alliance and Future Prospects

The Decentralized Recovery (DeRec) Alliance, spearheaded by industry leaders, has been established with the aim of creating a standardized, open-source protocol for DeRec. This collaborative effort seeks to encourage wider participation and ensure interoperability across diverse platforms and applications. By fostering industry collaboration, the DeRec Alliance endeavors to advance the adoption and development of DeRec, ultimately enhancing digital asset recovery processes.

Looking ahead, DeRec emerges as a transformative technology set to redefine how individuals safeguard their digital lives. By empowering users to maintain control and recoverability of their digital assets, DeRec offers a future where the loss of a device no longer results in irreversible data loss.

Conclusion

DeRec offers a glimpse into a future where individuals can exert greater control over the security and recoverability of their digital assets. With ongoing efforts from the DeRec Alliance and advancements in the field, DeRec stands poised to become a cornerstone of digital security alongside established measures like strong passwords and two-factor authentication. As we navigate an increasingly digital landscape, DeRec empowers individuals to safeguard their valuable information and regain access when needed, heralding a secure and accessible digital future.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

X (Twitter) | Facebook | LinkedIn | CoinMarketCap

Disclaimer:
This blog is for educational purposes only. Information presented here, including projects or brands mentioned, is informative and not financial, legal, or tax advice. While we strive for accuracy, we cannot be held liable for any inaccuracies. Cryptocurrencies are inherently risky. Do your own thorough research and consider consulting a financial advisor for investment decisions aligned with your goals and risk tolerance. External links may be present and we are not responsible for their content or practices. Review their terms of service and privacy policies.

Decentralized Recovery (DeRec): Redefining Digital Assets Recovery was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

The Ethereum blockchain has revolutionized the concept of decentralized finance (DeFi) and smart contracts. However, its popularity has also exposed limitations in its scalability. Transaction processing times can become slow, and gas fees can surge during periods of high network congestion. To address these challenges, the Ethereum development community has been diligently working on a roadmap of upgrades, with the Dencun upgrade being a major milestone.

TL;DR:

✅Ethereum Dencun upgrade deployed on March 13, 2024.

✅Introduces Proto-Danksharding for cheaper L2 data storage.

✅Potential for lower L2 fees and foundation for future scalability.

✅Challenges include maintaining decentralization and data availability.

✅Paves the way for a more scalable and user-friendly Ethereum.

The Dencun Upgrade: A Culmination of Efforts

The Dencun upgrade, deployed on the Ethereum mainnet on March 13, 2024, represents the successful culmination of two earlier proposed upgrades — Deneb and Cancun. This combined upgrade signifies a significant step forward in improving Ethereum’s scalability through the introduction of Proto-Danksharding, a stepping stone towards the ultimate solution — Dank Sharding.

Understanding Ethereum’s Scalability Challenges

Ethereum operates on a layered architecture. Layer 1 (L1) acts as the core blockchain, guaranteeing security and immutability for transactions. Every transaction ever made on the Ethereum network is permanently stored on L1. However, L1 has a limited processing capacity, leading to bottlenecks during periods of high activity. This translates to slow transaction processing times and high gas fees, which are the costs associated with processing transactions on the network.

To alleviate these issues, Layer 2 (L2) solutions have emerged. L2 networks operate off-chain, processing transactions more efficiently and at lower costs compared to L1. Numerous decentralized applications (dApps) have migrated to L2, allowing users to enjoy faster transactions and lower fees.

However, as L2 adoption grows, the challenge becomes one of data storage. While L2 networks process transactions off-chain, they still need to interact with L1 for final settlement. This involves uploading transaction data back to L1, which adds to the overall network cost. L2 network operators, known as sequencers, are responsible for uploading this data and bear the brunt of these storage fees.

Introducing Proto-Danksharding (EIP-4844): A Solution for L2 Data Storage Costs

The Dencun upgrade introduces Proto-Danksharding, outlined in EIP-4844, as a way to address the L2 data storage cost issue. By storing only the commitment value on L1 and offloading the actual data to temporary storage solutions (blobs), Proto-Danksharding significantly reduces the storage requirements for rollup data. This translates to lower gas costs for sequencers who are responsible for uploading this data. Here’s a breakdown of how Proto-Danksharding works:

Blobs and Blob-Carrying Transactions:

Blobs:
Instead of permanently storing expensive data (like rollup data) directly on the blockchain, Proto-Danksharding introduces the concept of “blobs.” Blobs essentially act as temporary data containers.

Blob-Carrying Transactions:
A new type of transaction, called a blob-carrying transaction, is used to upload data to L1. However, unlike traditional transactions that store the entire data payload, blob-carrying transactions only upload a compressed version of the data, known as the commitment value. This significantly reduces the amount of data stored on L1.

Benefits and Potential of Proto-Danksharding

Indirect Reduction in L2 Fees:
While Proto-Danksharding doesn’t directly impact user fees on L1, by lowering sequencer costs, it has the potential to indirectly reduce overall L2 fees for users. Lower sequencer costs can incentivize more competition within the L2 space, ultimately driving down fees for users.

Foundation for Dank Sharding:
The Dencun upgrade lays the groundwork for the future implementation of Dank Sharding, a more comprehensive sharding solution for L1 scalability. Sharding essentially involves splitting the Ethereum blockchain into smaller partitions (shards), each processing transactions independently. This significantly increases the overall processing capacity of the network.

Potential for New Developments:
The temporary storage offered by blobs creates opportunities for new developments and services within the Ethereum ecosystem. Businesses could potentially emerge that specialize in secure and efficient temporary data storage solutions for blobs.

Real-World Examples and Use Cases of Proto-Danksharding

While Proto-Danksharding is still a relatively new technology, it has the potential to impact various applications within the Ethereum ecosystem. Here are some potential use cases:

Scalable Decentralized Exchanges (DEXs):
Decentralized exchanges (DEXs) allow users to trade cryptocurrencies in a peer-to-peer manner without the need for a central authority. However, current DEX implementations can suffer from scalability limitations due to the high cost of storing order book data on L1. Proto-Danksharding, with its ability to reduce storage costs, could pave the way for more scalable DEXs that can handle a larger volume of trades and users.

Efficient Non-Fungible Tokens (NFTs):
NFTs represent ownership of unique digital assets like artwork, collectibles, and in-game items. However, storing the data associated with NFTs on-chain can be expensive. Proto-Danksharding’s temporary storage solutions could offer a more cost-effective way to store NFT metadata while maintaining security and verifiability.

Scalable Gaming and Metaverse Applications:
The rise of blockchain gaming and the metaverse presents exciting possibilities for immersive experiences. However, scalability remains a challenge for these applications. Proto-Danksharding’s potential to reduce transaction costs and improve processing speeds could enable more scalable and engaging gaming and metaverse experiences.

Beyond these specific use cases, Proto-Danksharding’s impact could extend to various other areas within the Ethereum ecosystem. As developers explore the possibilities of this technology, we can expect to see a new wave of innovative applications that leverage its benefits.

Technical Considerations and the Road Ahead

While Proto-Danksharding represents a significant step forward, there are still challenges to overcome before Dank Sharding can be fully implemented. Here’s a look at some key considerations:

Proposer-Builder Separation (PBS):
Dank Sharding introduces the potential for centralization issues. PBS is a proposed mechanism to address this challenge. It separates the role of the block proposer (who creates the block) from the builder (who determines the transactions included in the block). This allows anyone to participate in building blocks and earn rewards through a mechanism called MEV (Maximal Extractable Value), regardless of their computational resources. This separation helps to ensure a more decentralized network where block proposers cannot unfairly prioritize certain transactions.

Data Availability:
For Dank Sharding to function effectively, all participants in the network need to have access to the data they require for verification purposes. This poses a challenge, as data availability needs to be guaranteed across all shards. Various solutions are being explored, such as data availability committees and sampling techniques, to ensure that all nodes have access to the necessary data for validation, even if they are not responsible for processing a particular shard.

Security Considerations:
Introducing sharding adds a layer of complexity to the network, and security remains paramount. Extensive research and testing are ongoing to ensure that Dank Sharding maintains the same level of security as the current Ethereum blockchain. This involves evaluating potential vulnerabilities that could arise due to sharding and implementing robust security measures to mitigate these risks.

The Future of Ethereum: Beyond Dencun and Towards Dank Sharding

The Dencun upgrade marks a significant milestone in Ethereum’s scalability journey. By introducing Proto-Danksharding, it paves the way for a more scalable future with Dank Sharding. While challenges remain, the Ethereum development community is actively working on solutions. Once these challenges are addressed, Dank Sharding has the potential to significantly increase the network’s processing capacity, paving the way for wider adoption of Ethereum and its applications.

Beyond scalability, the Dencun upgrade and the upcoming Dank Sharding advancements have broader implications for the Ethereum ecosystem:

Increased Network Usage:
With improved scalability, Ethereum will be able to accommodate a larger number of users and transactions, fostering further innovation and growth within the DeFi and dApp space.

Reduced Barriers to Entry:
Lower transaction fees associated with increased scalability can attract new users and developers to the Ethereum ecosystem, further accelerating its development.

Enhanced Decentralization:
Mechanisms like Proposer-Builder Separation can help to ensure a more decentralized network, promoting fairness and censorship resistance.

However, it’s important to acknowledge that the path forward requires ongoing research, development, and collaboration within the Ethereum community. Addressing technical challenges, ensuring security, and fostering a healthy and diverse ecosystem will be crucial for the long-term success of Ethereum’s scalability roadmap.

[D’CENT Wallet]

D’CENT Wallet is created by IoTrust, a company founded by security experts with over two decades of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE).

D’CENT Wallet caters to the diverse needs of cryptocurrency users, prioritizing security and user experience. Users can choose the Biometric Wallet, Card type Wallet, or the free-to-use Software Wallet.

Website | Medium | Twitter | Instagram | Facebook | LinkedIn | Youtube

Ethereum Dencun Upgrade: A Deep Dive into Proto-Danksharding and its Impact on Scalability was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.

안전하고 사용자 친화적인 암호화폐 지갑으로 손꼽히는 디센트 지갑이 아스타 네트워크 지원을 대폭 확장하며 업계를 놀라게 하고 있습니다. 기존 Astar Native 및 Astar EVM 지원에 이어 이제 혁신적인 zkEVM 확장 솔루션까지 지원하며, 디센트 지갑은 사용자에게 아스타 네트워크 자산 관리를 위한 최고의 경험을 선사합니다.

업데이트의 주요 특징

아스타 네이티브(XC20) 토큰 관리:
ASTR 토큰을 지갑 내에서 직접 안전하게 보관, 전송, 수신할 수 있습니다. 복잡한 타사 거래소 없이 간편하게 ASTR을 관리할 수 있습니다.

아스타 EVM(ERC20) 토큰 관리:
아스타 EVM에서 실행되는 모든 ERC20 토큰을 단일 인터페이스에서 관리할 수 있습니다. 아스타 생태계 내에서 별도의 지갑 없이 모든 토큰을 손쉽게 다룰 수 있습니다.

아스타 zkEVM(ERC20) 토큰 관리:
최신 zkEVM 기술을 적용하여 거래 속도를 높이고 수수료를 낮춘 토큰 관리를 제공합니다. 아스타 zkEVM의 잠재력을 최대한 활용하여 경쟁력을 확보할 수 있습니다.

맞춤형 토큰 지원:
사용자는 원하는 토큰을 추가하여 전체 아스타 포트폴리오를 하나의 지갑에서 관리할 수 있습니다. 유연한 관리 기능으로 자산 운영의 효율성을 높일 수 있습니다.

강화된 보안:
업계 최고 수준의 보안 기술인 보안 인클레이브 기술과 생체 인증 등을 적용하여 사용자 자산을 안전하게 보호합니다. 암호화폐 자산 관리에 대한 걱정 없이 디센트 지갑을 이용할 수 있습니다.

협력을 통한 사용자 가치 창출

디센트 지갑은 아스타 네트워크와 함께 성장하며 사용자에게 더 많은 가치를 제공하기 위해 노력하고 있습니다.

지속적인 기능 개발:
아스타 생태계에 특화된 새로운 기능 개발을 통해 사용자 경험을 더욱 향상시킬 것입니다.

강화된 보안 조치:
최신 보안 프로토콜과 모범 사례를 적용하여 사용자 자산을 보호하고 암호화폐 자산 관리에 대한 신뢰를 높일 것입니다.

커뮤니티 참여:
아스타 네트워크 커뮤니티에 적극 참여하여 사용자와 소통하고 협력함으로써 디센트 지갑을 더욱 발전시킬 것입니다.

디센트 지갑: 아스타 자산 관리의 미래

디센트 지갑은 아스타 네트워크의 관문이자 암호화폐 자산 관리의 미래를 제시하는 솔루션입니다. 안전하고 편리하며 유연한 디센트 월렛을 통해 아스타 네트워크의 혁신적인 기능을 경험하고 암호화폐 자산 관리의 새로운 지평을 열어보세요.

[디센트 지갑]
디센트 지갑은 (주)아이오트러스트에서 만든 블록체인 지갑 서비스입니다. (주)아이오트러스트는 15년 이상의 보안칩(SE 및 TEE) 기반 임베디드 보안 솔루션 개발 경험을 보유한 보안 전문가들이 모여 있습니다. 블록체인 기반의 디지털 자산을 안전하게 보호하면서 디앱 서비스와 사용자를 연결하는 것을 목표로 합니다.

디센트 지갑은 세 종류의 지갑을 지원합니다. 지문인증형 지갑과 카드타입 지갑은 디센트의 하드웨어 지갑 제품입니다. 하드웨어 지갑 없이도 디센트 모바일 앱의 소프트웨어 지갑 서비스를 이용할 수 있습니다.

트위터 | 페이스북 | 링크드인 | 코안마켓캡

[아스타 네트워크]
아스타 네트워크는 엔터테인먼트 및 게임 프로젝트를 포함한 다양한 기업 서비스가 일본과 아시아를 넘어 전 세계로 진출하기 위한 게이트웨이 역할을 합니다. 현재 일본 시장을 대표하는 블록체인으로서, 폴카닷 및 폴리곤과 함께 웹3의 글로벌 채택을 촉진하고 수백만의 사용자에게 서비스를 제공합니다.

아스타 zkEVM은 영지식 기술을 활용하여 이더리움 상의 웹3 경험을 확장하는 새로운 레이어 2 솔루션입니다. 이로부터 아스타 네트워크는 이더리움에 존재하는 스마트 컨트랙트, 개발자 도구 및 지갑과 원활하게 통합되는 EVM 동등 환경을 가져갑니다.

한국 공식 커뮤니티를 통해 여러분의 의견을 들려주세요. 여러분의 모든 피드백은 생태계 성장에 언제나 큰 힘이 됩니다. 또한 한국 공지채널과 공식 블로그를 통해 다양한 교육자료 및 최신 소식을 전달드리오니 커뮤니티 여러분의 많은 관심과 독려를 부탁드립니다.

디센트 지갑, zkEVM 통합으로 아스타 네트워크 지원 확장 was originally published in D’CENT Wallet on Medium, where people are continuing the conversation by highlighting and responding to this story.