Explore the Future of Web3: Shardeum's Whitepaper Released!

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What is Shardeum?

Shardeum is an EVM-based, linearly scalable smart contract platform that provides low gas fees forever while maintaining true decentralization and solid security through dynamic state sharding.

What does Shardeum aim for?

Shardeum aims to be a chain capable of onboarding over a billion people to the blockchain and crypto revolution. Shardeum, like the Internet, will be open, collaborative, and community-driven and would democratize accessibility to decentralization.

Shardeum will be the infrastructure on which the next iteration of the Internet, Web3, will be built.

Will Shardeum have a native token?

Yes. SHARD (SHM) will be the name of the token. It is still in the development stage

How can I find and read the Shardeum Whitepaper?

Here is the link to Shardeum whitepaper.

What are the Use cases of Shardeum?

  • P2P transactions
  • DeFi
  • Open source AI
  • NFT
  • Metaverse
  • Node mining
  • Staking
  • DEX
  • Decentralized Identity
  • Games
  • Swap services
  • Decentralized social media
  • Others

What are the features of Shardeum?

  • Dynamic State Sharding
  • Linear scalability
  • Low transaction fees
  • EVM-based Smart Contract platform
  • Solves scalability trilemma
  • Auto Scaling
  • Security
  • Immediate finality
  • Low Latency
  • Low Bandwidth
  • High Fairness
  • High Capacity

How will Shardeum achieve energy efficiency?

Energy efficiency means the consensus algorithm used by the network should not require excessive energy beyond what is necessary to process the transactions. Bitcoin and other networks based on the Nakamoto consensus are designed to use high energy expenditure to secure the network from a 51% attack. However, efficient consensus algorithms such as Paxos and PBFT do not require high energy expenditure. The tradeoff is that these algorithms need the nodes to be assigned a node id before joining the network. Thus, these algorithms have been used in permissioned networks and not for nodes that can participate without requiring a node ID.

Shardeum will use an energy-efficient consensus algorithm that requires nodes to have a node ID upon joining the network. However, a novel approach does not need a central entity to decide which nodes are part of the network.

How will Shardeum achieve auto-scaling?

Auto-scaling means that the network should self-govern the number of nodes the network needs and properly incentivize nodes to achieve the desired size. This implies that the network can effectively use the available nodes to achieve desired tradeoffs, for example, scaling of throughput proportional to the number of nodes available. Otherwise, there is no benefit in a network trying to auto-scale.

In networks like Bitcoin, there are conflicts in the desired size of the network. The low bandwidth requirement would favor having as few nodes as possible. In contrast, the high security and decentralization requirement would prefer having as many (unrelated) nodes as possible. Shardeum will aim to build a network that can auto-scale.

How will Shardeum achieve Fast Finality?

Fast finality means having a quick turnaround time between submitting a transaction to the network and knowing that the transaction is irreversible.

In networks like Bitcoin, there is a probabilistic finality time. The longer you wait, the lower the chance that a transaction confirmed in a block cannot be reversed. Thus, the finality time is not just for the transaction being included in a block. Still, some blocks are being produced after that to reduce the probability of the transaction being reversed. For large value transfers on the Bitcoin network, it is recommended to wait for at least six blocks (about an hour) to ensure irreversibility.

Shardeum’s immediate finality sets it apart from other blockchains, which offer probabilistic or absolute finality. It is further a breakthrough in blockchain technology, as it provides finality without the need to wait for multiple blocks to be confirmed. You can read more about this in our detailed blog.

How will Shardeum achieve Low Data Bandwidth?

Low bandwidth means that the network should minimize the amount of data transfer needed when distributing transactions and achieving consensus.

This does not imply just compressing the data or using binary formats; instead, the more critical factors are network architecture and algorithmic details of the consensus algorithm. In bitcoin-like networks, adding more nodes increases the amount of bandwidth used to process each transaction.

Shardeum will aim to create a network where the amount of bandwidth consumed by a transaction is constant and does not increase proportionally to the number of nodes.

How will Shardeum achieve Low latency?

Low latency means the total turnaround time between submitting a valid transaction to the network and knowing that the network has committed to the transaction in a short period of time.

In networks like Bitcoin, latency is the time between submitting the transaction and including it in a block. For such networks, the fastest latency is no less than the average block production time which is around 10 minutes.

Shardeum will provide a latency of just a few seconds by processing each transaction individually before grouping them into blocks.

How will Shardeum achieve High capacity?

High capacity means that the network should provide persistent storage for massive amounts of state data. Global-scale applications could require exabytes of state data. The current blockchains and distributed ledgers appear to be functional only because they have not been stressed in this dimension.

Shardeum will aim to build a network that can horizontally scale throughput and capacity.

How will Shardeum achieve High fairness?

High fairness means that a transaction received by the network earlier than another one should be processed accordingly.

In a blockchain-based network, transactions within a block are considered to have occurred simultaneously, and the order in which they are applied does not matter. For some applications like games, this does not provide sufficient time resolution. Also, it is possible for transactions that were received much later to be processed before earlier transactions. In bitcoin-like networks, you can get priority by paying more gas.

Shardeum will aim to create a network that processes and applies transactions in the order received. You can take a look at this blog that goes into details of why time based transactions ordering have been practically hard to implement so far and how Shardeum will process transactions in a FCFS basis as a result of its design to solve scalability trilemma.

How will Shardeum achieve High throughput?

High throughput means that the network should process a vast number of transactions per second.

In networks like Bitcoin, where every node must process every transaction (i.e., validate and apply), the bottleneck is the processing power of the slowest full nodes. If the bitcoin network were to increase the self-imposed block size limit, it would run into a more natural bottleneck of processing power. The only way to speed up the network would be to raise the processing power of all the nodes (vertical scaling). So all networks where every full node must process every transaction have the same theoretical throughput limit.

But in actuality, we see considerable differences when comparing networks like Bitcoin, Litecoin, and Dash. These differences are mainly due to different self-imposed block size limits and block rates. If devs removed these self-imposed limits, the differences due to different consensus algorithms would start to appear. Networks that used proof-of-stake would be much faster than networks that used proof-of-work since the node’s processing power is not being used up by proof-of-work computation. Ideally, the rate at which the network processes transactions should be proportional to the number of nodes in the network. Increasing throughput means increasing the number of nodes (horizontal scaling). Shardeum will aim to build a horizontally scalable network.

What is Sharding, and more specifically, what is “Dynamic State Sharding”?

In simple words, sharding breaks the job of validating and confirming transactions into small and manageable bits, or shards. While sharding is ultimately the best way to tackle the scalability issue, applying it to blockchain-based networks is not nearly as easy as applying it to centralized databases.

The good news with Shardeum is that the consensus and processing are done at the transaction level and not at the block level. And, through dynamic state sharding, the network will shard its state by evenly and dynamically distributing compute workload, storage, and bandwidth among all the nodes. This not only allows for parallel processing of transactions but also very low overhead for validator nodes as they will store only the state data of transactions/accounts they are involved in.

The protocol assigns each node to cover one or more unique address ranges in such a way that for any given address there is a well defined number of nodes holding the data for that address. Each node added to the network allows other nodes to slightly reduce the total addresses they cover while still ensuring that any given address has the specified level of redundancy.

And why are they important? Well, this is how Shardeum will get to maintain low transaction fees for developers and end users forever. Dynamic state sharding will help the network to scale linearly making it the first Web3 network to do so. Read this blog for a more detailed explanation of how Shardeum will make use of dynamic state sharding.

What exactly is meant by “linear scaling”?

With help of dynamic state sharding, every node added to the network will increase the transaction throughput instantly. By simply adding more nodes from the network’s ‘standby’ validator pool during peak demand, the TPS will increase proportionally making Shardeum the first Web3 network to scale linearly. And this is the main X factor that impacts every other outcome on a blockchain network favorably including throughput, decentralization, security, and constant transaction fees irrespective of the demand in the network.

Will there be more whitepapers released on the core technical aspects of the protocol?

We filed defensive patents around the various innovations in our protocol that includes consensus algorithm, autoscaling and dynamic state sharding. We will move our focus next to releasing more ‘technical whitepapers’ around these innovations and other core aspects of the protocol soon.

What are the primary types of nodes in Shardeum?

Validator Nodes (also known as Validators):

These nodes validate the transactions in the network by participating in the consensus. They will have to stake SHM to be able to participate. Shardeum will reward honest validators with SHM for participating in transaction validation and consensus. Validator nodes don’t store the whole history and in fact they only store the state of accounts they handle,  and hence they will be lightweight.

Archive Nodes:

Archive nodes maintain the entire Transaction history. Archive nodes will also have to stake SHM and they will earn a portion of the network rewards as an incentive to store historical data.

Standby Nodes:

These are validator nodes standing by in the network and not currently participating in consensus. Standby nodes help scale the Shardeum network quicker when more transactions are pending. At the end of every cycle, the oldest active validators in the network are rotated out for standby validators for optimum security. Standby validators require staked SHM to become active and they become eligible for rewards only after completing their active validator period and being cycled out.

What are the other types of nodes on Shardeum?

Other than the above three mentioned nodes, there are other types of nodes needed to move data and transactions in and out of the Shardeum as well as monitor the health of the network. These include connector nodes, relayer nodes and a monitor server. The connector nodes provide an entry point for external wallets and clients to query and submit transactions to the network. These are the same as RPC servers in the Ethereum ecosystem. Relayer nodes communicate with archiver nodes or other relayer nodes to store and stream data produced by the network to downstream services such as the explorer. These are similar to exit nodes in the Ethereum ecosystem which are used by exchanges and explorer services. The monitor server receives status updates from active validator nodes and provides a visual view into the health of the network. You can read more about them in our whitepaper.

What is the current status of the Sphinx Dapp Testnet (devnet)? Is the Betanet currently the active network on Shardeum?

The Sphinx Dapp testnet has been discontinued to focus on making the betanet feature-complete and robust as we approach our mainnet launch. We encourage developers and validators to engage with the Shardeum Sphinx Betanet, where you can build projects, run validator nodes, test dapps functionalities and participate in stress testing our network. Detailed information and endpoints for the betanet are available here.

Following the discontinuation of the Sphinx Dapp Testnet, the Shardeum Sphinx (Betanet) is now the sole active network on Shardeum. You will already see several dapps have re-launched on betanet. We invite our community to actively participate in this phase, contributing to the evolution of Shardeum as a leading, scalable, and affordable L1 smart contract platform.

We would like to partner with Shardeum through integrations and building dapps. How should I proceed?

You can express your interest in partnering with Shardeum by submitting the partnership enquiry form. You can also alternatively reach out to Shahzad Nathani, Head of Operations or Gregory Hemmer, Head of Ecosystem. You can start with submitting the partnership enquiry form though which will help us to understand your needs better and how we can best partner with you.

How can government agencies and existing Web2 companies partner with Shardeum?

We are pleased to partner with anyone who wants to use our secure and scalable technology to provide their solutions and products to their end users. You can start by submitting the partnership enquiry form.

Could new L1 projects designed to support Layer 2 (L2) solutions for enhanced scalability potentially make Shardeum obsolete?

Shardeum is built with scalability, security, and decentralization in mind. To date, many L2s are viewed as a solution that solves the L1’s inability to solve the blockchain trilemma. Shardeum contains a legacy blockchain’s decentralization and security, and its innovational linear scalability through dynamic state sharding. Thus it is solving the root problem in the root as a L1 blockchain platform.

Will the Shardeum network work with different wallets?

Any EVM-based wallet will work on Shardeum. Developers can also build new Shardeum wallets as a dApp project on the network.

What is the difference between Shardeum and other similar sharded chains?

Features Shardeum Harmony Near Elrond
EVM Compatible Yes Yes via Aurora No (WASM)
Smart Contract Language Solidity, Vyper Solidity, Vyper Rust C, C++, C#, Rust
Explorer EtherScan-like Custom Custom Custom
Tx Fees in $ Very Low & Constant 0.000001 0.00044 0.005
Txs Per Second (TPS) 1 per node (100k TPS @ 100k nodes) 2k per shard (8k TPS @ 4 shards) 10k per shard (100k TPS @10 shards) 3.75k per shard (15k TPS @ 4 shards)
Nodes per Shard 128 250 100 800
Latency 10 Sec always for EIP2930 txs 10 Sec per involved shard 10 Sec per involved shard 10 Sec per involved shard
Consensus Algorithm PoQ + PoS FBFT PBFT SPoS
Consensus Level Transaction Block Block Block
Current Shards NA 4 but contracts on 1 1 unsharded 3 + metachain
Sharding Type Dynamic Static Static Static
Scaling Type Linear TPS per node Stepwise TPS per shard Stepwise TPS per shard Stepwise TPS per shard
Archive Nodes Yes No No No
Cross Shard Composability Yes No No No

Does Shardeum consider failed transactions and internal transactions say between a validator and archive nodes for calculating TPS?

No. The TPS (transactions per second) of a blockchain network should be based solely on the transactions initiated by actual users which are processed successfully. So ideally, TPS should exclude internal network activities, say, between nodes and any failed transactions.

When is Shardeum launching its mainnet?

You can find the roadmap here. The mainnet is scheduled to be launched in Q1 of 2024. In line with Shardeum’s OCC principle, we have also added a weekly breakdown of remaining feature completion and milestones to our detailed roadmap for your information.