With transaction fees rising and transaction completion times increasing, shortcomings in the leading cryptocurrencies are becoming hard to ignore. This industry is begging for a public blockchain with a high transaction speed that is still decentralized.
The bitcoin blockchain can only process seven transactions per second, making bitcoin transactions taking as long as a few days to process, with transaction fees constantly rising. Ethereum smart contract execution fees have increased to more than 5 cents from less than one cent in 2016. There are a variety of methods being developed to provide a more sustainable option, however, they each come with their own drawbacks. Bitcoin-NG decouples mining from transaction validation, but it depends heavily on the leader node. Putting the majority of the power in the hands of a single node makes it a more centralized system than blockchain purists prefer. Consensus models like delegated Proof of Stake (PoS) introduce more parties to be trusted or are unsubstantiated. These are just a few of the alternatives.
Cypherium seeks to create a new hybrid blockchain network that retains decentralization and the ability to process thousands of transactions per second through a hybrid consensus mechanism in which a group of nodes validates transactions within a public blockchain. The system’s key features are double chain consensus, federated architecture and separate areas for test and the production of smart contracts.
They are achieving this by combining two separate consensus mechanisms. By utilizing the combined strengths of Proof-of-Work and Practical Byzantine Fault Tolerance, they hope to develop a blockchain capable of mass transaction throughput without sacrificing decentralization.
Cypherium’s token, CRS, will be used to fuel the Cypherium ecosystem. Transaction fees and node rewards will all come in the form of this unique token. Cypherium will ensure distributed ownership of tokens to provide decentralization, along with high throughput, fast settlement, low fees and scalability.
Cypherium is also including aspects into the development that enable application level governance to be separated from protocol level governance. A test sandbox enables smart contracts to run on a mini-fork of the mainnet and deploy into the production environment once debugging is finished. Once the test protocol is functional, the result is transposed onto the main protocol.
Cypherium provides a solution to resolving conflict over the blockchain without hard-forking. To extend its capacity without hard forking, Cypherium enables participants, or nodes, to adjust its protocol. The committee can decide to approve, or not approve, proposed upgrades such as including block size, transaction fee, stack depth, network protocol, mining algorithm, etc. The protocol can adjust its parameters by voting. A major protocol revision will require approval backed by more than two-thirds computing power and total stake ownership.
When it comes to consensus, Cypherium does not grant unlimited power to a single party, such as developers, mining pools or stakeholders. Transaction validation and leader election are split into two separate chains to eliminate transaction confirmation time. All transactions must be collectively verified by the validator group, which is constantly changing. If a validator commits fraud, it is immediately removed from the group.
Cypherium’s groundbreaking development allows blockchain technology to entertain the idea of being applicable in everyday life. With the current transaction fees skyrocketing and transaction throughput bottlenecking, cryptocurrency is not yet a valid option to pay for everyday items. Cypherium, however, is leading the way to making paying for your morning coffee with crypto a reality. They stress the importance of low transaction fees and fast transaction times. Together, this is the formula that will bring blockchain technology and cryptocurrency to the mainstream market.
Where bitcoin’s mining algorithm is vulnerable to application specific integration circuits (ASIC), Cypherium brings an ASIC resistant CPU mining algorithm bound to device memory. The centralized production of ASICs contributes to centralization in a permissionless system.
The Cypherium blockchain is capable of registering billions of IoT devices and improving their security through cryptographic proofs.