Putting DARC on Binance Chain Is Key to Expanding Konstellation’s Ecosystem
A rapidly expanding set of application-specific blockchains based on Cosmos Tendermint technology will soon be interoperable.
When we first entertained the idea of moving our project from NEM to another chain, we were reluctant. As we stated in a previous Medium post, we were very excited about the potential future that the newest version of the NEM public blockchain, titled Catapult, had to offer. We still think that the technology is a good solution for private blockchains in the financial services industry. But as we became more intimate with the inner workings of the blockchain industry, it became more and more clear that migrating our token to a chain whose primary focus was on liquidity and interoperability would be a necessary step for our development.
From a Swiss Army Knife to a Professional-Grade Sushi Knife
Many of our token holders asked us to switch to the Ethereum blockchain. At one point, especially after the token explosion of early 2018, most of the coins in the top 100 of Coinmarketcap were those that used the ERC20 protocol. We understand the notion that things we are familiar with are more comforting.
However, in the long run, we do not think that Ethereum is the best blockchain for financial assets. We do not need a Swiss Army knife to realize our goal of becoming the go-to blockchain solution for financial services. We need a professional-grade sushi knife to accomplish this very specific task exceptionally well. The recent exploits of DeFi platforms on Ethereum that led to nearly $1 million in losses almost instantaneously demonstrate a reason to be wary.
With great projects like MakerDAO and compound.finance already heavily invested in the Ethereum (ETH) chain, of course the Ethereum public blockchain will be an important part of the DeFi future. But that doesn’t mean that all tokens should be issued on the same chain. Nor does it mean that ETH is the best option for the next generation of DeFi tools.
The ERC20 protocol is not a perfect solution for financial assets because it is not the proper tool for cryptographic asset tokens. An ERC20 token is a Turing complete smart contract constrained to a very few parameters. At the point of ETH’s inception, Turing completeness was a worthy goal. The sentiment at that time was that blockchain was a revolution able to instantaneously change the world. But in fact, Turing incompleteness may be a better solution to the problems at hand, namely security and the lack of mainstream adoption. The negative potential of the Turing complete ERC20 protocol was enabled by the ease of modification that resulted in the nightmare that happened with the Oyster Protocol (PRL) ERC20 smart contract.
The Ethereum Virtual Machine (EVM) is a powerful thing. In theory, it allows companies to create smart contracts to execute anything they want to solve any problem. There are numerous examples of what can happen on the bad side of that power, including PRL and the infamous DAO hack. And now the bZx exploits.
Gratefully, the industry is seeing more and more examples of the good side of that power like BAT, REP, and LINK tokens. All of these projects are totally unrelated and use the EVM to solve interesting and important blockchain programming issues.
Konstellation Network Solidifies Its Ambition to Be a Premier Financial Services Ecosystem for Digital Assets
Konstellation Network’s vision is to develop the blockchain ecosystem for financial services so that we can further our mission to increase access to life-changing investment opportunities to everyone. We firmly believe that a token protocol should not be based on a Turing complete language. Token-specific contracts like the Safe Contracts issued by our partner Everitoken and the BEP2 protocol are more secure for financial assets. We echo the sentiments of EveriToken:
“Ethereum is a wild and powerful thing, but sometimes, the best option is the simplest one.”
By focusing on one specialized function for blockchain technology, the ambition for Konstellation Network, with its base in South Korea, is that it will become the hub for the digital asset ecosystem of Asia. We chose simplicity and reliability over Turing completeness. Simple state machines like those enabled by the Tendermint Core Practical Byzantine Fault Tolerant (pBFT) consensus mechanism provide a much higher level of security, scalability and, especially important in the financial services industry, near instant finality of transactions.
Konstellation Co-Founder Sang Lee added:
“We also believe that the BEP2 protocol is becoming potentially ‘the next ERC20’ with massive adoption and migration to the standard by other projects. Binance Chain and Binance DEX will become a critical piece in the coming explosion of defi projects within the Cosmos Ecosystem.”
Cosmos + Binance Chain = Bigger Ecosystem
As we have stated previously, we believe that the Cosmos project and its focus on interoperability is absolutely the way forward for solving what we believe is one of the biggest roadblocks in promoting widespread crypto adoption. What Vitalik Buterin has called the blockchain “trilemma” of decentralization, security, and scalability we believe cannot be adequately solved by second-generation blockchain platforms like NEM and Ethereum.
Our Konstellation Network will be developed as a Hub within the emerging robust Cosmos ecosystem. Therefore, we will be able to record and interact with transaction data from any other Cosmos Zone (there are more everyday) as well as stand-alone blockchains that will have built a bridge into Cosmos via Cosmos’ unique Inter Blockchain Communication (IBC) mechanism. The first such bridge will be made to the Ethereum blockchain with a project called Ethermint. Other Tendermint/Cosmos projects like Kava are actively building bridges to Binance Chain. Even Binance Chain itself is based on the software development kit provided by Cosmos (Cosmos SDK). We expect that the first set of IBC bridges will be built into projects that use the Tendermint Core pBFT engine. That’s why we want to build our own blockchain with Cosmos SDK technology. We want to be able to easily “plug in” to all of these great Tendermint-based projects.
We anticipate that the growth of the Cosmos Ecosystem will be a key driver of growth for volumes on the Binance DEX and, concurrently, usage of the BEP2 token protocol. Because the protocol was designed by one of the top cryptocurrency exchanges, the platform makes all token-related transactions much more simple and intuitive than our experience on NEM or what we’ve observed on Ethereum. BEP2 also allows blockchain projects to connect to other chains in an economical way, allowing multiple pools of tokens to be maintained on different chains and thus easing the transactions between different blockchains. Therefore, this transition toward the Binance Chain makes sense for us to allow our community to be connected to other projects.
Because of these considerations, we have decided to transition our entire token supply of 1 billion DARC tokens from the NEM blockchain to a pool of BEP2 protocol tokens.
“We at Konstellation are extremely excited to join the vibrant and fast-growing community found among the projects that have already migrated to Binance Chain.” expressed Konstellation Blockchain Lead Nicholas Krapels. “Our goal to become the home for incubating innovative digital asset-based financial products is significantly strengthened by our pivot to the BEP2 protocol.”
The current supply of 1 billion DARC mosaic tokens on the NEM blockchain will be replicated on Binance Chain. BEP2 DARC will eventually completely replace NEM DARC, which will be fully phased out by July 26, 2020.
Please swap your DARC tokens now!
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