Besides their bewildering presentation as a “blockchain-agnostic protocol to fix blockchains”, this Enigma ($ENG), which seems to have a cult following, can be solved if you think about how the fact that Smart Contracts data are public limits their usability. And, also, if you are sympathetic to the idea of the scalability problem being solved in a simple, clever way. Enigma is a protocol, a second-layer solution to be added to other blockchains, not your usual blockchain platform.
In platforms like Ethereum, all information, like smart contracts and data related to dApps, although pseudonymously, are fully available for any node wanting to check them, and couldn’t possibly be another way, as they’re not centrally executed. Now this pseudonymous aspect has always been considered mostly acceptable in simple cryptocurrency blockchains, but for smart contracts, where more significant information is shared, it becomes a greater hinder.
Let’s take, as an example, a smart contract on the blockchain for a dApp which provides credit calculation based on their users’ consumption and income. This means, if you use the dApp, all your financial data is open for anyone to see. This is not an option – it’s a feature inherent to the blockchain. That’s why dApps like this simply don’t exist.
Many dApps ideas, actually, cannot currently be put into practice simply because of this privacy issue. A great deal of big companies doesn’t adopt blockchain solutions which could be of benefit for them because they just can’t afford to share their data.
As if this wasn’t enough, they also aim to permanently solve the scalability problem. Scalability problems are becoming each day a more aggravating aspect and, especially in major cryptocurrencies, they’re already more than present. Gas price in Ethereum is becoming too prohibitive, transactions in Bitcoin are already unbearably slow, even with SegWit implemented. Some cryptos solve the scalability problem by storing some data out of the central blockchain, in an off-chain stored in centralized databases. That becomes another problem when, well, data is not decentralized anymore and we have to trust the server.
To achieve this, they introduce the concept of “secret contracts”, adding a second layer solution, off-chain network to the main one. This chain, which, unlike other off-chains solutions, is also decentralized. This solves the scalability and private issues, as data is running on the Enigma nodes, not on the main ones. Nodes on the network will be able to store tokens ($ENG) and all CPU power offered to maintain and make Enigma’s blockchain secure are rewarded. Computation and data stored are paid with $ENG. Yes, more or less like $GAS.
The Enigma briefly explained
Guy Zyskind, CEO of Enigma and his team developed a protocol in which, on the Enigma chain, input data are not revealed, but are, nevertheless, validated by their nodes, which only pass the information whether the computation performed is valid or not.
Roughly explaining, data input is firstly encrypted with homomorphic encryption to avoid fraud and divided into pieces. Smaller pieces of various different inputs then have to be validated by the subsequent nodes. The subsequent nodes then join some pieces (of different inputs) and send then to fewer nodes (only a subset of nodes validate data on this stage, not all of them like it would normally happen in the usual protocol). The following same number of nodes will join the input pieces and send them until they finally reach the output. Every computation performed in this process is encrypted, they can be checked for validity or not, but not the information on them. As the inputs are divided into smaller pieces and distributed to a smaller number of nodes, less work needs to be done. Because of the homomorphic encryption’s shared randomness, the same level of security is achieved.
This, according to Zyskind et al. paper provably solves both the privacy issue and the short and long-term scalability problems of blockchains at the same time.
And to show a bit of Enigma’s potential, they launched Catalyst, the first application built on top of the Enigma protocol. It allows users to send and curate data related to crypto-assets for investing and research. Using their live, easy-to-use trading tools, users can test trading strategies and receive analytics reports based on historical and real-time data fed by their users, to support crypto-assets trading decision-making. It also supports live-trading of crypto-assets, currently using three major exchanges (yes, they’re Bitfinex, Bittrex, and Poloniex). They provide a marketplace which allows users to earn tokens by developing winning strategies, curating datasets and selling private datasets.
A resting Dark Horse?
Enigma is usually mentioned by their cult following as the most promising dark horse of 2018. Regardless of the hype, both the ICO of Enigma and Catalyst (which uses the ENG token) have been highly praised by ICO curators and analysts and the token quickly raised to the top-100 cryptocurrencies in market cap. Enigma is a necessity. The only risk they face is, well, if someone finds a better solution to fix blockchains better than them, which could very well actually happen. Other than that, we can be mostly positive that the Enigma protocol will be adopted by a wide range of blockchains – or even most of them. Yes, this has the potential to be this huge – but we have said this about other cryptocurrencies before, so always read it with a pinch of salt.
We will be updating our subscribers as soon as we know more. For the latest on ENG, sign up below!
Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
Image courtesy of Koshy Koshy via Flickr
Should Crypto Projects Devote Resources to Community Growth and Marketing?
2020 has been an incredible year for crypto as investors have generated windfall profits and crypto projects have seen their businesses gain the spotlight they’ve been looking for. While Bitcoin has received most of the attention after major institutional investors announced they were accumulating the increasingly scarce asset, many altcoins have also seen their fair share of glory. When looking at all the big winners of the past year, the first project that probably comes to mind is Chainlink, having appreciated by more than 550% YTD and now valued at over $4.5 billion. But, the actual biggest winner of the year is HEX with a YTD return of over 5,000%.
I mention both of the above projects as they have each taken slightly different paths to achieve greatness. Chainlink has devoted resources toward building a fundamentally sound business with many strategic partnerships while HEX has spent vast sums of money on marketing and promotion. Both approaches are valid, but one thing is certain, it is absolutely imperative for crypto projects to let the crypto community know what makes them special. Of course, one of the reasons that makes crypto so valuable is the powerful blockchain technology that most projects are utilizing.
Cryptocurrency vs. Blockchain Technology
It’s important to make a distinction between blockchain technology and cryptocurrency. Although they are often used interchangeably, they are different. Blockchain technology and crypto were both created after the 2008 financial crisis, but cryptocurrency…
XENO starts VIP NFT trading service and collaborates with contemporary artist Hiro Yamagata
Hong Kong, Hong Kong, 24th December, 2020, // ChainWire //
The XENO NFT Hub (https://xno.live) will provide a crypto-powered digital items and collectables trading platform allowing users to create, buy, and sell NFTs. Additionally it will support auction based listings, governance and voting mechanisms, trade history tracking, user rating and other advanced features.
As a first step towards its fully comprehensive service, XENO NFT Hub launched a recent VIP service to select users and early adopters in December 2020 with plans for a full Public Beta to open in June 2021.
“NFTs are extremely flexible in their usage, from digital event tickets to artwork, and while NFTs have a very wide spectrum of uses and categories XENO will initially focus its partnership efforts and its own item curation on three primary areas: gaming, sports & entertainment, and collectibles.”, said XENO NFT Hub president Anthony Di Franco.
He also added “This does not mean we will prohibit other types of NFTs from our ecosystem However, it simply means that XENO’s efforts as a company will be targeted into these verticals initially as a cohesive business approach.”
Development and Procurement Lead, Gabby Dizon explained, “Despite our initial focus, we found ourselves with a unique opportunity to host some of the works of Mr. Hiro Yamagata. We are collaborating with Japanese artist Hiro Yamagata to enshrine some of his artwork into NFTs.”
Mr. Yamagata has been…
My Crypto Heroes Announces Issuance of MCH Governance Token
Tokyo, Japan, 24th November, 2020, // ChainWire //
My Crypto Heroes is happy to announce the issuance of MCH Coin as an incentive to players in the My Crypto Heroes ecosystem, aiming to allow them to craft a “User-oriented world”. The MCH coin is available on Uniswap with a newly created pool with ETH.
My Crypto Heroes is a blockchain-based game for PC and Mobile. It allows users to collect historic heroes and raise them for battle in a Crypto World. Officially released on November 30th, 2018, MCH has recorded the most transactions and daily active users than any other blockchain game in the world.
What is MCH Coin?
MCH Coin is being issued as an ERC-20 Standard Governance Token. The issuance began on November 9th, 2020, with 50 million tokens issued.
Of the funds issued, 40% are allocated to a pay for on-going development and as rewards for advisors and early investors. 10% are allocated to marketing and the growth of the ecosystem, and 50% are allocated to the community. The Distribution Ratio of the MCH Coin is subject to change via a governance decision.
The MCH coin will be used as a voting right as part of the ecosystem’s governance, with 1 coin being 1 vote. It will also be used for in-game utilities and payments. Additional information can be found here:
During December 2020 the first governance…