Blockchain has a scaling problem. Much faster transaction speeds are needed for many applications, particularly real-time gameplay. In 2017, the popularity of one gaming application, CryptoKitties, led to skyrocketing fees and slowed up all transactions on the popular Ethereum platform which hosts it. Whoever solves the scalability problem will become the hottest property in blockchain. Dfinity is a leading contender.
What is Dfinity?
Dfinity is building a secure, cost-effective and decentralized cloud computer. It will be housed in a network of machines, distributed around the world and put to work running the next generation of mega-applications—decentralised versions of Uber, eBay, Facebook and more.
How is does Dfinity compare to similar blockchain platforms?
Today, Ethereum dominates the crypto industry. Dfinity aims to solve the scaling problems experienced by Ethereum without compromising on its level of decentralization—something another rival, EOS, has been criticized for.
Dfinity claims it can finalize transactions in under five seconds. As a comparison, Bitcoin takes up to an hour, and Ethereum 6 minutes.
How does Dfinity work?
In most blockchain-based projects, the transaction verification process relies on mining a process that is energy intensive and can be slow.
Dfinity uses a variation of the proof of stake algorithm to achieve consensus. In Dfinity’s version, nodes produce a random number, called a “random beacon.” This is used to select the next group of nodes and to drive the platform’s protocols. This mechanism is called the Threshold Relay Consensus model. It’s one of the key pieces in Dfinity’s arsenal.
Dfinity involves lots of theories about how random numbers are applied
Dominic Williams, chief scientist and president, Dfinity
- Infinite scalability
- Security—Dfinity claims it has a system of checks that are superior to Ethereum’s.
- Compatible with smart contracts so dApps can be built on the platform
- Highly experienced team
Dfinity’s Threshold Relay Consensus and system of checks are largely untested. Some would argue that both approaches compromise decentralization.
What are Dfinity’s aims?
Dfinity’s wider focus is on building a platform that can be used across a significantly wider set of applications, at much lower cost, than cloud platforms such as Amazon and HP. One of Dfinity’s key selling points is that its blockchain can provide a similar service for a tenth of the cost.
Dfinity wants its platform to be the place where developers build the next generation of mega-applications.
How is Dfinity cheaper and more secure than today’s cloud computing?
Dfinity aims to make it possible to build and run an Internet business without having to rely on another enterprise, such as eBay or Facebook.
It uses a process known as sharding to store data cheaply on the blockchain.
Dfinity also claims its cloud will make it possible to create systems that need far less human capital.
Did you know?
Dfinity’s creator, Dominic Williams, thought up “Fight My Monster,” the fastest growing online kids game in Europe back in 2012.
The cloud computing industry is currently worth $176 billion, which shows there is big demand in the market. Dfinity has received almost $2 billion in funding, so can support third-party teams that want to build applications, tools and protocols for the platform. If developers believe it’s the place to build and users take to decentralized systems, as stakeholders they will have an incentive to ensure the system stays simple and cost-effective.