Month: October 2021

Pancake Swap.

You may have noticed that there are blockchain projects springing up with crazy food based names. Projects such as SushiSwap and Bakery Token have been in the news quite a bit recently. Today I’m talking about PancakeSwap and taking a deep-dive in to what it is and what it does.  Sweet!

PancakeSwap is a Decentralized Exchange (DEX) that makes use of the Automated Market Maker (AMM) model to enable users to swap any BEP20 token for another using a liquidity pool.

Users can provide liquidity into these liquidity pools for a chance to earn a share of the platform’s trading fees (known as liquidity mining) and take advantage of its various DeFi products such as staking, farming, lottery and others.

CAKE is the cryptoasset for the platform and serves as a governance token. It also acts as a means of staking so users can earn more CAKE and the tokens of other projects. Users can also take part in the PancakeSwap lottery game.

History

In September 2020, a team of anonymous developers forked and ported the SushiSwap code to BSC (Binance Smart Chain). PancakeSwap and the CAKE token launched via a fair distribution to initial liquidity providers and early farmers on the platform.

The team chose to build on BSC because the chain is faster and has lower fees compared with Ethereum, which at that time was experiencing high network congestion. As a result, the platform saw rapid growth in both its user base, trading volume, and total value locked (TVL) as priced-out users from Ethereum flocked to BSC for their trading and yield farming operations.

Between February and June 2021, it beat Uniswap as the largest AMM in terms of total value locked, number of transactions, and users.

What Does PancakeSwap Do

PancakeSwap aims to provide a community-governed DeFi application that offers users fast and cheap token swaps and yield-farming services with many opportunities to earn rewards.

The project aspires to be a total solution for DeFi users with its suite of present and planned products including token swaps, liquidity mining and yield farming, Initial Farm Offerings (IFOs), NFTs, prediction markets, lending and borrowing, margin trading and more.

Technology

Binnance Smart Chains  architecture enables ultra-fast transactions and low fees with cross-chain compatibility. This is why Ethereum-based SushiSwap’s code could be easily forked and ported to BSC to create PancakeSwap. BSC uses a customized version of the Proof-of-Stake (PoS) algorithm called Proof-of-Staked Authority (PoSA) where participants stake BNB to become validators and earn the transaction fees from every valid block that they propose.

With a block confirmation time of 3 seconds, BSC facilitates the development of powerful decentralized applications that serve millions of users on platforms like PancakeSwap, providing them with fast transactions at a fraction of the cost.

As an AMM, PancakeSwap facilitates instant token swaps using liquidity pools that users can deposit tokens into to earn a share of the trading fees (this is commonly known as liquidity mining). Users who provide liquidity into these pools receive a liquidity provider (LP) token which acts as a ‘receipt’ for their deposits. This receipt allows users to reclaim their original funds deposited in the liquidity pool. In addition to the trading fees liquidity providers earn, they can stake their LP tokens in any of the supported farms on PancakeSwap to earn CAKE.

Furthermore, users can participate in the PancakeSwap Syrup Pool by staking their CAKE tokens to earn more CAKE or the tokens of other BSC projects that take part in the PancakeSwap Syrup Pool program. Users stake their CAKE to get SYRUP tokens as well as earn a share of 25% of each block reward. Users then stake the SYRUP to start earning tokens of other BSC projects that have a Syrup pool on PancakeSwap. Thus users earn from multiple sources with the same funds. Syrup Pool is a PancakeSwap initiative to help new BSC projects gain market attention and adoption by putting their tokens in front of the largest community on BSC via free distribution of a portion of their token supply.

Token

CAKE is the native cryptocurrency of the PancakeSwap platform that functions primarily as a governance token. It also functions to incentivize users to provide liquidity to the PancakeSwap liquidity pools.

By staking CAKE, earning more CAKE or the native tokens of other projects in the PancakeSwap Syrup Pool is possible.

Other applications include using it to purchase lottery tickets in the PancakeSwap lottery game.

Conclusion

In less than one year, PancakeSwap has overtaken Uniswap as the largest AMM. Did you know you can also win NFTs on the Binance Smart Chain? If you win you can trade your NFT for more CAKE or keep it in your wallet. All you have to do is register on the Binance Smart Chain.

 

Talking About Komodo

Komodo is a secure, stable and interoperable Blockchain platform and ecosystem providing end-to-end technology solutions. Developers can create their own Blockchain projects (or independent Blockchains), crowdfund, launch, and integrate with other projects in the crypto industry through the Decentralized Exchange or DEX via atomic swaps.

History

In 2016, Komodo’s Lead Developer, James ‘JL777’ Lee, was developing a project called SuperNET on Nxt, one of the world’s very first Blockchain platforms.

The Nxt development team implemented major adjustments to the codebase without consulting any of the projects built on the Nxt Platform. The changes broke SuperNET’s backend tech, requiring hundreds of hours of work to repair the damage. This resulted in the developers rethinking the project entirely, and the result was Komodo.

Purpose

According to Komodo’s LinkedIn page, its technology provides the tools that developers, start-ups, and businesses need to create a customized Blockchain. The Blockchain can host an application, software, or other Blockchain-based solution. The principles of composability drives Komodo’s development.

Composability is a design principle focused on providing an array of components, which is activated when needed and used in different configurations to meet the unique demands of a specific use-case. Composable systems emphasize modular and deployable solutions powered by a fluid set of resources to support growth.

Founders

James Lee – otherwise known as JL777/JL777c, James Lee is a computer programmer, entrepreneur and Blockchain personality. He is the founder and core developer of Komodo.

Funding

Komodo held an Initial Coin Offering (ICO) that ran from October 15th to November 20th 2016. KMD tokens sold at a rate of 0.00012908222 BTC per KMD.

One hundred million KMD coins were pre-mined with 90% of them sold to investors and the remaining 10% held as working capital for Komodo’s development and marketing.

The Komodo Platform raised 2,639 BTC, the equivalent of $1,929,188 USD at the time.

Technology

The Komodo platform uses Delayed Proof-of-Work (dPoW) as a security mechanism. It is a a second layer of protection that makes use of the Litecoin blockchain hashpower to enhance network security by using cross chain notariztions. By using dPoW, Komodo developers can secure their own network as well as any third-party chain that joins the Komodo ecosystem.

Delayed Proof-of-Work (dPoW)

Every ten minutes, the Komodo system takes a snapshot of its Blockchain. A block on the Litecoin network records the snapshot in a process called notarization. This process creates a backup of the entire Komodo system with the Litecoin Blockchain serving as the repository for said backup.

Komodo’s community-elected notary nodes write a block hash from every dPoW-protected Blockchain onto the Komodo ledger by executing a transaction on the Komodo chain. Using the OP_RETURN command, the notary nodes store a single block hash onto the Komodo chain.

The notary nodes select a block hash that is about 2.5 minutes old to ensure the entire network agrees that the block is valid. Each Blockchain’s network still reaches consensus for each block. The notary nodes record a block hash from a previously mined block.

The notary nodes then write a block hash from the Komodo chain onto the Litecoin ledger. This process runs by executing a LTC transaction and using OP_RETURN to write the data into a block on the Litecoin chain.

Once this notarization to Litecoin occurs, Komodo’s notary nodes write that block data from the LTC chain back onto the chain of every other protected chain. At this point, the network will not accept any re-organizations that attempt to change a notarized block (or any block for that matter).

AtomicDEX

AtomicDEX is a secure cryptocurrency wallet with an integrated atomic swap Decentralized Exchange (DEX). Users can store their digital assets and make cross-chain swaps without a middleman and for a minimal fee.capability

AtomicDEX does not limit trading to a single Blockchain protocol and offers a variety of cross-chain and cross-protocol support. AtomicDEX is the first end-user application built on the Komodo AtomicDEX API.

The AtomicDEX API is a suite of open source Blockchain development tools which includes an atomic swap engine (backend/core), DEX feature set, and API. It functions as means to build an array of financial applications.

The AtomicDEX swap protocol facilitates the trustless, secure exchange of digital assets across multiple Blockchains, both UTXO- and account-based.

Privacy

When Komodo first launched it had the ability for users to choose to make transactions private or not.  However, since February 2019 this functionality was disabled to ensure that KMD could be listed on crypto exchanges and that it also complies with financial legal regulations.

Independent side chains built using Komodo technology can however implement zero-knowledge and thus ensure transactions are private.

Token

KMD is the native currency of the Komodo Platform ecosystem.

Any Komodo address that holds over 10 KMD is eligible to claim KMD Rewards. To encourage active users, rewards stop accruing 1 month after a transaction. Therefore holders should aim to claim their rewards at least once a month. If users take advantage of this, the total adds up to about 5.1% in a year.

An interesting project that has been around (in crypto years) forever! Is Komodo a sleeping dragon that will continue to develop and evolve, I hope so.

Polkadot

Polkadot is a next-generation Blockchain protocol that unites a network of purpose-built Blockchains. Polkadot allows these Blockchains to operate seamlessly together, exchanging data as well as value.

History

On January 11th 2016, Gavin Wood left the Ethereum community and turned his attention towards a new venture. According to Wood, he came up with the idea for Polkadot in the Summer of 2016. At this time, Ethereum 2.0 sharding specs had not yet solidified, so implementation could not occur.

Prompted by developer Marek Kotewicz, Wood began attempts to design a simple sharded version of Ethereum. By October 2016, Wood had written the first draft of the Polkadot whitepaper.

Wood and Parity’s Peter Czaban co-founded the non-profit Web3 Foundation in the Summer of 2017. One of Web3 Foundation’s functions included managing the funds raised in the Polkadot token sale held in October of 2017.

Polkadot launched its testnet in January 2019, and the initial version of Polkadot officially launched in May 2020.

Polkadot aims to be a true multi-chain application environment where functions like cross-chain registries and computation are possible.

Polkadot can transfer this data across public, open, permissionless Blockchains as well as private, permissioned Blockchains.

This makes it possible to build applications that receive permissioned data from a private Blockchain and employs it on a public Blockchain.

Founders

You can find out more about the founders on their about page.

Funding

Polkadot held two token sales and raised approximately $200 million in the process. The Web3 Foundation oversaw the token sale. The Web3 Foundation is a Swiss non-profit Foundation that seeks to facilitate a fully functional and user-friendly decentralized web. The Web3 Foundation received 30% of the funds from the token offerings in order to fund the development of the project.

Technology

Polkadot operates two types of Blockchains, namely the main network known as the relay chain and user-created networks known as parachains. They feed into the relay chain, which is the main Polkadot Blockchain. This means that parachain transactions benefit from the security of the main chain.

The Relay Chain

The Relay Chain network handles the finalization of transactions and deliberately possesses minimal functionality. Smart contracts receive no support on the Relay Chain. Its main responsibility is to coordinate the system as a whole, including parachains.

Parachains

Parachains are custom Blockchains that use the Relay Chain’s computing resources to confirm the accuracy of transactions. Polkadot places no constraints over what parachains are able to achieve. However, they must be able to generate a proof that validators assigned to the parachain can actually validate. Sovereign Blockchains may have their own native cryptoassets and optimize their functionality for specific use-cases.

Bridges

Bridges allow the Polkadot Network to interact with other Blockchains (for example, the Bitcoin and Ethereum Networks).

Consensus Roles

The Polkadot Relay Chain uses a variation of Proof-of-Stake (PoS) consensus called Nominated-Proof-of-Stake (NPoS). This allows anyone who holds DOT to carry out one or more of the consensus roles. DOT is the native token of Polkadot.

  • Validators. They secure the Relay Chain by staking DOTs, validating proofs from collators and participating in consensus with other Validators
  • Nominators. They secure the Relay Chain by selecting trustworthy Validators and staking DOT
  • Collators. They maintain shards by collecting shard transactions from users and produce proofs for Validators
  • Fishermen. They monitor the Polkadot Network and report bad behavior to Validators. Collators (and any parachain full node) can perform the role of fishermen.

Token

The DOT cryptoasset has three distinct purposes. This includes governance over the network, staking and bonding:

  • Governance. Anyone who purchases DOT coins can use their DOTs to propose changes to the network and approve or reject major changes proposed by others.
  • Staking. Game theory incentivizes token holders to behave honestly. Good actors receive rewards whilst bad actors will lose their stake in the network. This ensures the network remains secure at all times.
  • Bonding. The addition of new parachains takes place by bonding tokens. Conversely, the removal of outdated or obsolete parachains occurs by withdrawing bonded tokens.

Conclusion

According to the Polkadot website, the Polkadot runtime environment’s coding is in Rust, C++, and Go with the hope that it will make Polkadot accessible to a wider range of developers. The types of projects using Polkadot include a cloud platform, a browser extension wallet and different types of block explorers.