Scalability, if you have been keeping up to date with blockchain technology then you have heard this word a lot.
It is the major obstacle that everybody involved in blockchain development is trying to solve.
The most ambitious among the groups trying to find a way to best scale the blockchain has to be ICON Republic. The group behind ICON believe the best way forward is to go big and make a huge network that can bring together the various blockchains in a way that they can integrate with each other.
In their own words they want to Hyperconnect the World.
What is ICON Republic?
ICON is a South Korean group that is trying to implement a network that can connect various blockchains together.
By using smart contracts and a loopchain, different blockchains will be able to communicate with each other. A network of communities is how they describe it.
Calling it a Republic belies the fact that there is no central authority. The way the network is set up is simple.
There are groups of nodes on a blockchain called Communities or C Nodes. Each Community can govern itself any way it sees fit. However they wish to validate blocks and create consensus is totally up to them. ICON Republic won’t be telling them how to do it.
A community can be made of of different institutions like banks, insurance companies, hospitals, etc. They can work together in the community or even individually. But, the main point being connectivity means that it is hoped that nodes will be occupied by institutions that need to streamline how they communicate.
A C-rep is a representative that is voted on by the Community to represent that blockchain within the Republic. That representative can vote on governance of the network within the Republic.
The Republic, then, is the group of representatives from the different communities. The ICON Republic functions as a communication channel between communities, and does
not affect the governance of the communities. So, again, the name Republic implies that it is a central authority, but the reality is that is is totally decentralized.
Why Form a Network of Blockchains?
The way things work right now with a central server that needs to connect with other servers to communicate between institutions is becoming unwieldy.
Blockchain technology is developing at just the right time for these transactions to become more streamlined and efficient. That works for the institutions themselves to save money and manpower and for the consumers and users of the institutions, as well.
Let’s take an example from the ICON whitepaper on how things work now and how it may look later.
They made the example of somebody buying a cup of coffee at Starbucks with their credit card. Once a card is swiped, it has to go through many different channels for the money to transfer from your bank to Starbucks. Passing through many different servers, communicating and sharing information to make that simple transaction insanely complicated.
What ICON envisions is that same transaction happening within a network of blockchains. With the bank, your credit card company and Starbucks communicating with smart contracts, this takes all of the complication of different servers needing to transact with each other. Cutting out the middleman is efficient, economical and safe.
Can this type of network work?
Well, it already is. It is being implemented with the Korean healthcare industry, for example. A patient can have their entire health history including DNA stored in their own smart contract. This sensitive information can only be shared with others that have access to the contract. This makes for a secure distribution of medical information through blockchain.
In addition, banks, insurance companies and universities are already on the network and able to seamlessly communicate with each other.On a level that is interesting especially to cryptocurrency investors and traders is the Decentralized Exchange, aka DEX. This exchange can take the wait out of trading crypto for crypto currency as different blockchains will be able to communicate with each other. Bitsquare and Bitshares work within the same principle, but since they require somebody to always be online they have limitations that DEX won’t. All transactions can be processed in real time.
How Will the ICX Coin Work?
As is the case with other blockchains that are looking to enable more real world applications, ICX tokens will be used to pay for transactions and incentivize voting and governance of the network.
In other words, ICON is a Delegated Proof Of Stake network.
ICX tokens entitle its holder to cast one vote for the delegate of their choice. Transactions will be confirmed and rewarded with ICX tokens and delegates will have more weighted votes based on how many tokens they possess.
How much value the token has will rise with the number of users in the network. The more users, or C-Nodes, the more transactions, the more transactions, the more ICX gets spent and the more ICX that gets spent, the higher the value of the tokens.
With blockchain development happening rapidly, it will be interesting to see how this Republic can grow. It seems to have tackled the issue of scalability by allowing blockchains to communicate and connect. It is already a proven model at the stage where it is now. But, as we have seen time and time again, there are always unforeseen circumstances that develop, and develop quickly, that can sidetrack a blockchain’s development.But, isn’t that what makes it so interesting?