The blockchain is the internet of value that gives us the ability to not only transmit the information but value in the blink of an eye to anyone anywhere in the world.
Aeternity is a new blockchain that has solved issues like scalability, privacy and transaction speed. Aeternity has learned from first generation Blockchains and it introduces three key elements that make it ready for mass adoption.
1. State Channels
State channels are based on the concept that only stakeholders involved in the smart contract should know the about details. Parties lock a state on the blockchain and perform transactions between themselves, off-chain. The final state is then logged on the blockchain.
As State Channels are mostly off-chain giving advantages like improved scalability, since most of the computation is done off-chain, and enhanced privacy since details of transactions are known to involved parties only.
In Ethereum, if you know any Ethereum address, you can see the history of past transactions and details of contract using blockchain explorers like Etherscan.io.
Aeternity solve this issue of privacy using state channels.
Transactions on Ethereum takes time due to congestion on blockchain and it’s worse in case of Bitcoin. Aeternity is lightning fast thanks to the use of state channels.
2. Hybrid Proof of work and Proof of Stake
Mining in case of big currencies like Bitcoin and Ethereum are limited to big whales only, who can afford expensive ASIC mining hardware. Aeternity opens his gates of mining for everyone by decentralizing mining, you can mine Aeternity on your laptop and even on your Smartphone.
The consensus is achieved by proof of work, while governance mechanism runs on proof of stake model that is based on prediction markets.
Proof-of-Work (PoW) is corner stone of cryptocurrencies, it allows a verifier to check with negligible effort that a miner has expended a large amount of computational effort.
Bitcoin uses Hashcash while Ethereum uses Ethash PoW. Aeternity will implement Cuckoo Cycle, the first graph-theoretic Proof-of-Work (PoW), and the most memory bound, yet with instant verification. Cuckoo Cycles aim is make mining possible on normal hardware like laptops and mobile devices.
3. The oracle machine
Aeternity lets you connect real-world data to smart contracts. Any real-world data can be integrated such as voting result, commodity prices (like oil and gas), weather conditions. This opens up the field for major use cases like supply chain management, insurances, gaming and so on. In case of Ethereum or Bitcoin, everything remains confined within the walls of the blockchain and there is no connection between real-world data and blockchain.
Combining these three elements Aeternity breaks the bottleneck for even further adoption of blockchain technology. Just like Ethereum blockchain covers shortcoming of bitcoin blockchain, Aeternity is one step ahead of Ethereum.
Aeternity (AE) stands at 75 position on table of cryptocurrencies, trading at 1.64 USD. It’s available at good investment rate. Make a smart move now, remember today’s 15000 USD Bitcoin was 0.008 USD in 2009.
Competition Article written by jmac
Stefan K. said:
Nice and compressed article with all important details!