Radix: A unicorn’s race to solving the blockchain quadrilemma
Blockchain’s moon race for enterprise-level scalability is on.
DeFi is booming. The demand that has followed brings us back to the same persistent issue, however: scalability.
What’s needed is a platform that can solve scalability issues for the long-term while retaining a decentralized network. A system to challenge the 1,700 transactions per second (TPS) speeds of legacy infrastructure on a global scale like Visa that also provides a foundation that can scale orders of magnitude further with demand.
One such project has flown under the radar, with a history of working on this problem that dates back to 2013. Radix is the first layer 1 protocol built specifically to serve the rapidly growing DeFi industry, solving the scalability issues that persistently hamper protocols like Ethereum, which is not designed to meet the requirements of decentralized financial services. Radix is already capable of transaction speeds that are an order of magnitude faster than Ethereum, with the final iteration of the potentially game-changing tech reaching speeds of 1.4 million TPS, and beyond.
Blockchain’s moon race for enterprise-level scalability is on. Radix has already garnered over $4 million from investors like TransferWise Co-Founder Taavet Hinrikus, as well as a $12.7 million eXRD public token sale (an ERC20 that can later be exchangeable 1:1 for native Radix XRD tokens).
So what is the hype about, and why is Radix potentially better than more well-known blockchains like Polkadot, Cosmos, and Ethereum?
Scaling DeFi Without Breaking Composability
The DeFi industry is growing; fast. The sector already accounts for over $25 billion, with a projected valuation of over $60 billion in the coming months. This pace is unsustainable, with increased applications and demand putting serious strain on the Ethereum blockchain. Transaction fees at peak periods are reaching levels that simply render many services unusable.
Radix isn’t the only project seeking to solve this problem, of course, and different approaches are deployed. Its bold claim is being the only protocol that achieves scalability for DeFi without breaking composability.
Current and proposed solutions all use a type of sharding to achieve the level of scalability required, whether via a hub-and-sidechain architecture (like Cosmos or Polkadot) or by running a static set of blockchains in parallel (like Ethereum 2.0).
While this allows for greater transaction throughput, it breaks a key feature of DeFi: composability. The ability to combine multiple functions from multiple dApps is vital for DeFi services, like simultaneous lending and borrowing. While such composability is possible on the existing Ethereum network, most of the proposed sharding solutions for scalability break this capability as applications get separated onto shards that cannot combine into a single transaction.
Radix provides a frictionless alternative, delivering linear scalability through sharding without breaking composability, meeting the throughput requirements of dApps over time with continued interoperability. It does this by using its formally proven Cerberus sharded consensus protocol, alongside three other features, to provide the level of scalability that the potential of DeFi requires.
Building an Ecosystem That Is Decentralized, Fast and Secure
The Radix network comprises four technologies designed to bring DeFi adoption to the mainstream.
Cerberus: A High-Speed Network Consensus Mechanism
Cerebus offers a different kind of sharding with a completely new consensus design that removes the barriers between shards.
Rather than split dApps between a static set of shards, Cerberus uses an unlimited set, with dApps represented dynamically across these shards, resulting in limitless parallelism. This means that no matter the demand load, built-in financial incentives add more nodes to spread the load and increase throughput accordingly.
While each shard can run fast consensus independently, Cerberus can also “braid” these consensus processes together into one for each transaction, if required. This braided cross-shard consensus is just as atomic and secure as single-shard consensus, meaning that composability is just as free and frictionless as on a single blockchain, without the scalability limits.
Radix Engine: For Building DeFi Applications
The Radix Engine is the network’s building environment, facilitating the development of smart contracts and specific DeFi applications. Radix smart contracts are known as Components, which attempt to more closely model real-world expectations of finance.
Component Catalog: A Library To Help Build DeFi
Most smart contracts become active once they get pushed to the system’s users. The Radix Component Catalog handles apps before they become active on the platform. The Catalog, therefore, provides templates to create additional Components, enabling the quick development of secure DeFi apps.
Developer Royalties: A Decentralized On-Ledger Incentive Program
Commercial incentives are the final piece in the puzzle. Most protocols create finite developer funds that are hopefully enough to bootstrap a network and get it up and running. Such funds can run out, though, and developers may be less aligned with adding long term value to the ecosystem.
Instead, Radix incorporates an on-ledger developer royalty system, allowing Component developers that contribute to the Catalog to include a fee in transactions each time their Components are used. This system delivers long term recurring revenue incentives, creating a decentralized marketplace for DeFi utility.
Winning Blockchain’s Moon Race
The growth potential of DeFi must be met with technology that can handle the scalability requirements of an industry that seeks to challenge the enterprise level of global legacy finance. It needs a protocol that facilitates fast and secure deployment of commercially viable applications at scale, without breaking composability.
Having spent over seven years developing a solution that does just that, with a testnet due in Q1 and a mainnet launch in Q2, Radix may well make that quantum leap. Radix recently listed on Bitfinex, a top 5 global cryptocurrency exchange, on January 21.