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Ethereum—The Whole Forking History

Ethereum is the second most recognizable name in the cryptocurrency and blockchain space, next to Bitcoin. Ethereum was created to overcome the limitations of Bitcoin, which is essentially just a system for decentralized money, and push the boundaries of blockchain technology and decentralization. Like Bitcoin, it is supported by a peer-to-peer node network, meaning that it is essentially a decentralized server run by a vast number of computers with no central administrator or intermediary.

Despite a common misinterpretation, Ethereum itself is the name of the network and not its currency. Nodes are rewarded in Ethereum’s native currency called Ether (ETH) and the cost of computation is calculated in Gas.

The Ethereum network was invented by Vitalik Buterin, a Russian-Canadian programming prodigy. In his whitepaper, which was released in 2013, he describes Ethereum as a, “blockchain-based decentralized mining network and software development platform rolled into one.”

Bitcoin is governed by an underlying software protocol, which is a very simplistic version of the smart contract, serving as predefined rules for its network. Ethereum basically extends the idea of Bitcoin’s contract protocol but is far more ambitious with the aim of facilitating the development of an entire ecosystem for open-ended decentralized applications (dApps) and smart contracts to build and run while removing the risk of third-party interference.

Prior to the Ethereum network being launched in 2015, anyone that wanted to create a blockchain-based application had to create their own blockchain platform from scratch. But with Ethereum, developers can leverage off the Ethereum infrastructure to create virtually any application imaginable. Lack of Scalability — Cryptokitties

Both Ethereum and Bitcoin platforms depend on a peer-to-peer network of nodes and both use mining incentives to enlist those nodes into their platform. A node simply refers to a single computer out of the network of thousands that supports the peer-to-peer network.

As a public blockchain, the Ethereum network aims to offer support to as many users as possible. However, Ethereum runs on the same Proof-of-Work protocol as Bitcoin meaning that computational power is needed, not only to produce new coins but to process transactions and to keep the entire ecosystem moving. The stress put on each node becomes more of an issue as the Ethereum network attempts to grow or scale. Scalability is simply a network’s capacity to grow in size and manage the increased demand. For the Ethereum blockchain network, each node contains the full transaction history and updated ledger for account balances and contracts. As new blocks of transactional information are created, all nodes must store and update which can cause severe issues with network speed.

While scalability is now a common pain point for blockchain developers, the issue was first exposed in the Ethereum Network in 2017 when a dApp for the creation of cryptographic virtual cats, Cryptokitties, became a viral success and clogged the entire network with more transactions than it could handle. The popularity of Cryptokitties saw the dApp make a jump from $1million in transactions to $3million in transactions over the space of a day and at the time made up 20% of all transactions on the network. Besides the networks slowing down drastically, another noticeable effect was also the increase in price of the transactions.

What’s a Fork?

As a road diverging towards different directions is known as a fork, so is this expression applied to blockchains. Ethereum, like Bitcoin, is open-source coded meaning that it can be accessed and modified by anyone if consensus is reached but is still enforced by a specific set of consensus rules that are applied to evaluate the validity of a new block of data. Modifying the open-source code without reaching complete consensus of the network will result in one of two types of forks in cryptocurrencies, a hard fork or a soft fork. As blockchain platforms are decentralized, a consensus of what data is held on the blockchain must be reconciled by all nodes on the network in order to keep a single blockchain intact.

Soft Fork—a modification to the consensus rules that is backward compatible with previous versions of the blockchain. Soft forks modify the blockchain and apply new rules but fundamentally still allow older versions of the blockchain to remain valid.

Hard Fork—a permanent split in the blockchain if consensus cannot be reached. A hard fork is a far more substantial issue as it will invalidate older versions of the blockchain.

Ethereum’s Four Stages

Stage One—Frontier

The Ethereum platform was originally designed only for developers and it only featured command-line interfaces. This pioneer stage of its development was known as ‘Frontier’—alluding to the wild and untamed environment and the huge potential of the Wild West. After some initial errors were fixed and the platform was adapted for end users, Ethereum launched ‘Homestead’—its first public version. Stage Two—Homestead Upgrade

The first planned Ethereum hard fork was the Homestead Upgrade which was executed on the network on May 14, 2016. The upgrade removed a point of centralization on the network called ‘canary contracts’, and introduced new code into Ethereum’s programming language—Solidity. In addition, the update also included the application ‘Mist’, an ETH wallet that in addition to storing ether, can be used to write smart contracts.

The Homestead upgrade was one of the earliest implementations of Ethereum Improvement Proposals (EIPs)—proposals put forward by the Ethereum community that are to be included in network upgrades. For a full list of Ethereum’s EIPs click here.

The Forking DAO IncidentWhile not a planned upgrade, it is impossible not to mention the DAO Incident of 2016. A group of developers were inspired by the decentralization of cryptocurrencies and conceived of the idea for a decentralized autonomous organization (DAO) which would leverage the Ethereum Network. The project attracted many of Ethereum’s earliest investors and by May 2016—14% of all the Ethereum tokens were being held up by the crowd-funding initiative. Despite warnings that vulnerabilities were being detected within the DAO code, the project went live at the end of May 2016. In June, the project became the subject of an attack that saw the forewarned vulnerabilities exploited and 3.6 million ether were effectively stolen. Members of the DAO and Ethereum community engaged in hot debate about what to do next. Hard forking would all the stolen ether to be reabsorbed back into the pool, but this decision would not achieve a consensus as many believed that the attack was a valid maneuver, although unethical, as it did not technically break the rules. The decision was made and the Ethereum blockchain made an unplanned hard fork. As the decision did not achieve full consensus, many users have continued to support the old chain which is now called Ethereum Classic.

Stage Three—Metropolis The next planned stage for the Ethereum network is known as Metropolis, which is also the current stage of development. Metropolis would be implemented in two stages—Byzantium and Constantinople. The main impetus behind Metropolis is to prepare the network to transition from the Proof-of-Work (PoW) method to the Proof-of-Stake (PoS) method of consensus. Currently Ethereum and Bitcoin both use PoW which leverages ‘mining’—where nodes must solve complex equations where the first one to reach the solution is awarded the cryptocurrency and block ownership. In PoS, the process is called ‘forging’, more of a random selection where a node’s chances of owning the next block are greatly boosted by the proportion of assets that they staked in the network.Mining has been criticized as making the rich richer as chances of solving the complex equations are greatly improved in PoW based on the computation power you can afford, leading many major organizations to set up mining pools. An individual miner is effectively blown out of the competition for blocks as they cannot afford to run the same amount of calculations as a billion dollar multi-national.

Byzantium Fork

Byzantium upgrade went live in October 2017 and introduced a total of nine EIPs to the system. This first upgrade has paved the path for the PoS method by restructuring the reward system for blockchain miners. The updates disincentivize mining on Ethereum’s blockchain by reducing the award for a single block from 5 Eth to 3 Eth. This update has also purportedly delayed Ethereum’s Ice Age —where mining will become so difficult that it will act as a catalyst for the network’s move to the PoS model—by up to 18 months.

The Byzantium update also made it compatible with cryptographic primitives, a function that provides cryptographic evidence of a transaction’s completion while keeping all participating parties anonymous—thus enhancing the privacy system and introducing a more autonomous flow of assets within the system. Constantinople Fork

The Constantinople upgrade went live on February 28, 2019, after being pushed from its original launch scheduled for the middle of January 2019. The delay was caused when an independent audit firm, called ChainSecurity, published a report highlighting how one of the five main upgrades could give hackers entry to steal assets. Clearly having learned from the DAO incident, developers delayed the launch opting to first investigate and resolve the security issue. Constantinople is made up of two stages, Petersburg (launched in February 2019) and Istanbul:The Petersburg stage centered around the “difficulty bomb” and introduced a total of five EIPs, four of which had very little impact as they were mainly enhancements and optimizations. One that did have a major impact was EIP 1234 which became known as the ‘thirdening’ and was an adjustment to block rewards. It was a hard-fork which saw the block rewards reduced from 3 ether to 2 ether, further deterring small miners by decreasing profits, as well as reducing inflation.Istanbul Fork ExecutedThe Istanbul hard fork is a system-wide upgrade that changed a few facets of Ethereum’s functionality including mining protocol and code execution. It activated six EIPs including the introduction of the ProgPoW—a proof-of-work algorithm designed to close the efficiency gap available to specialized ASICs.On Dec. 5 2019, Ethereum successfully hit block number 9,069,000, where the Istanbul hard fork has been completed. Istanbul is Ethereum’s eighth hard fork overall, addressing issues such as denial-of-service attack resilience, interoperability with equihash-based proof-of-work and gas costs, which is the cost to send a transaction on the Ethereum network.

The lowered gas costs enabled by Istanbul’s Ethereum Improvement Proposals (EIPs) are aimed to increase the bandwidth on the blockchain and foster zero-knowledge privacy technologies.

Vitalik Buterin has claimed that the capacity now has the potential to reach 3,000 transactions per second.

A few popular crypto exchanges including Binance announced their official support for the Ethereum Istanbul hard fork update. The Ethereum network has witnessed the collaboration between node operators and miners to update the software to support the Istanbul hard fork.

Muir Glacier Fork

The developers forgot to diffuse the difficulty creep during the Istanbul hard fork earlier in December 2019, leaving exchange employees and node operators awake even after the New Year celebrations. As Ethereum has faced the dilemma of moving to proof-of-stake in the usual way, delaying in the mining “ice age,” developers have voted to disable the difficulty time bomb for miners to be able to seek block rewards with the use of some time. Ethereum quickly made plans to hard fork once again on New Years Eve 2019 in what would be call the Muir Glacier Fork.

The Muir Glacier update was activated at block number 9,200,000 on Jan. 2, 2020, with only one improvement proposal, EIP 2384. The proposal aims to delay the difficulty bomb, a built-in algorithm of the Ethereum blockchain that could drastically increase the difficulty in mining a new block if left unaccounted for. The update is designed to delay the difficulty bomb for another 4,000,000 blocks, or approximately 611 days.

This is the third difficulty bomb delay the Ethereum network has undergone, with the first two occurring in 2018 and 2019.

Stage Four—Serenity

Serenity is the ultimate goal of the Ethereum Blockchain. It will mark a complete transition to the PoS model. For a full preview of Eth 2.0 please click here.

Images via Shutterstock

IOTA Network Increases its Speed by 20x Following its Relaunch a Few Months Prior

The IOTA Foundation, a non-profit organization focused on blockchain and open-source development has announced the latest version of its node software, Hornet together with the IOTA community.

The IOTA community has conducted a stress test that illustrated a stable network of over 150 nodes with over 650 confirmed transactions per second (TPS). This shows an increase in transaction throughput by a factor of 20, while Hornet is able to consume 10 times less memory under normal operations compared to its previous node software.

This new node software is paving the way towards IOTA 1.5, also known as Chrysalis, which includes protocol enhancements that will lead to “a substantial increase in network speed.”

In a release shared with Blockchain.News, Luca Moser, Software Engineer at IOTA Foundation said, “Due to IOTA’s parallel architecture and feeless transaction model, developers can build real-world applications without the constraints imposed by traditional blockchain technology.”

“IOTA’s focus on regulatory compliance, standardization, and industry collaboration are key pillars of its adoption strategy. Many of the upcoming protocol upgrades were developed in partnership with our community and network of partners in industry and academia.”

The IOTA Foundation has been working with partners in academia, government, and business to create develop safe and secure open-source technologies in the digital ecosystem.

Iota Network has seen a massive hack in February, on the platform’s Trinity Wallet software. The network was shut down on the same day to prevent any further security breaches, however, 8.55 million MIOTA, approximately $2 million was stolen from 50 digital wallet users.

The Foundation announced that the network was back online after almost a month after the attack. As the person or persons responsible for the February breach was not found, Iota said it will “continue to work with the FBI, as well as the UK, German, and Maltese police to identify and track the attacker.”

To prevent future additional attacks on the network, the IOTA Foundation has made changes to its software security practices, to improve its security capabilities and resources.

Microsoft and Finastra Open Cloud Solution to Exponentially Accelerate Innovation for 8,500 Banks and Institutions

Finastra and Microsoft Corp have announced a strategic, multiyear cloud agreement to help accelerate the digital transformation of financial services and help realize an open-source future for finance.

In a release shared with Blockchain.News on July 21, Finastra and Microsoft announced a multiyear global strategic agreement to accelerate the transformation of financial services. The alliance will support demand for cloud solutions, aiming to compress years of innovation into months for 8,500 banking and financial institutions worldwide.

Open Source Future of Finance

The alliance of Finastra and Microsoft marks a commitment and builds on the 3,000 banks and financial institutions already supported by both companies across payments, lending, treasury, and retail banking on Azure. The agreement, paired with the unparalleled disruption of the industry, will reimagine the way banks and credit unions use technology and how we all think about sustainable, open finance.

Simon Paris, CEO, Finastra said, “We believe the future of finance is open. Together with Microsoft, we can provide people, businesses, and communities with the solutions and services that fit around their needs and lives, unlocking the power and potential of finance for everyone. As the pandemic has brought the future forward with regard to digitization, our vision to transform the world of financial services aligns closely with Microsoft’s ambitions, and I believe that together we can help accelerate this digital shift.”

According to the release, leveraging Microsoft platforms has already allowed Finastra to accelerate its product road maps to bring even more of its mission-critical solutions to the cloud for its 8,500 customers, alongside advancements in data, AI, and open banking.

“Finastra’s open developer platform, built on Microsoft Azure, is leading the way in accelerating collaboration and innovation in financial services. By helping with capabilities such as e-signatory and e-notary, Finastra is able to quickly extend those solutions for more customers,” said Scott Guthrie, executive vice president, Cloud + AI, Microsoft. “By delivering on operational efficiencies and reducing risk, we will help increase productivity and enable deeper client engagement.”

The Workplace of the Future

Along with the strategic partner relationship, Finastra’s Fusion Fabric.cloud open innovation platform will continue to encourage co-innovation of next-generation financial services applications.

The solution is powered by Microsoft Azure, and allows developers unprecedented access to build right on top of Finastra’s core systems for faster incubation of applications at scale. In addition, Microsoft Azure, the Power Platform and Office 365 are also being leveraged by Finastra to transform its own business and optimize operations.

With a focus on creating a workplace of the future, the Microsoft Workplace Analytics capabilities could also foster faster, and more definitive decision-making.

Kraken Contributes $250,000 to Enhance Ethereum 2.0 Upgrade

Kraken, a leading US-based crypto exchange, revealed its $250,000 donation aimed at helping open-source developer teams tasked with the Ethereum (ETH) 2.0 upgrade.

Giving back to open-source innovators

According to Jesse Powell, the CEO and co-founder of Kraken:

“We believe it’s our responsibility to give back to the open-source innovators who are building the next generation of cryptocurrency. That’s why we’re excited to work with the Ethereum Foundation to ensure developers receive funding from an increasingly diverse range of stakeholders.”

Powell added that collaborative efforts and support were vital in propelling growth in the Ethereum network in the long term.

Kraken customers have staked more than 800,000 ETH

Per the announcement:

“Kraken clients have already staked over 800,000 ETH, worth more than $2 billion, to secure the Beacon Chain.”

This decision had proven beneficial in late July because these clients had earned more than 25,000 ETH, approximately $58 million in rewards.

Ethereum 2.0, also known as the Beacon Chain, was launched in December 2020 and was regarded as a game-changer that sought to transit the current proof-of-work (POW) consensus mechanism to a proof-of-stake (POS) framework.

The proof-of-stake algorithm allows the confirmation of blocks to be more energy-efficient and requires validators to stake Ether instead of solving a cryptographic puzzle. As a result, it is touted to be more environmentally friendly and cost-effective. ETH 2.0 is also expected to improve scalability through sharding.

Ethereum has been witnessing various upgrades, which seek to boost the digital asset’s efficiency. The London Hardfork or EIP 1559 upgrade was the latest one to be incorporated, which triggered the first-ever deflationary block on the Ethereum network on August 5.

Therefore, scarcity was introduced every time as Ether was burnt after being used in transactions. This feature is expected to help and eliminate inflationary tendencies that the network was accustomed to before.

Starkware to Open Source Proprietary Prover

The scaling solution for Ethereum’s layer 2 To far, StarkWare has processed 327 million transactions and coined 95 million nonfungible tokens (NFTs). StarkWare has announced intentions to open source their proprietary Starknet Prover under the Apache 2.0 licence. This will take place in the near future.

The prover is an essential piece of software that Starkware employs in order to wrap up hundreds of thousands of transactions and condense them into a brief cryptographic proof that is then recorded on the Ethereum blockchain.

“Here at Stark Industries, we consider the Prover to be the technological equivalent of a magic wand. “It does a fantastic job of generating the proofs that enable inconceivable scalability,” said Eli Ben-Sasson, president and co-founder of Starkware. “It allows unprecedented growth.”

Starkware has come under fire from the cryptocurrency community as well as solutions that compete with it, such as ZK Sync and Polygon, for the fact that it retains ownership of the intellectual property (IP) that underpins its technology. This runs counter to the open source and interoperable ethics that underpin blockchain technology.

By making the prover open source and releasing it under the Apache 2.0 licence, any other project or network, as well as producers of games or databases, will be allowed to utilise the technology, modify the code, and personalise it as they see fit. The technology didn’t become widely available until 2020, but ImmutableX, Sorare, and dYdX are already making use of it.

Avihu Levy, head of product at Starkware, was hesitant to commit to a time period for open-sourcing the prover but said that it will take place after the introduction of the token and the decentralisation of Starknet itself. Nevertheless, he acknowledged that it would be doable throughout this year.

Levy said that the choice to open source the prover demonstrated that Starkware was becoming more confidence in its technology. He also stated that it would allow projects to become more confident about using it as an essential component of their protocols.

“Within StarkEx, this is something that is sometimes referred to as vendor lock-up or lock-in. Therefore, the commitment to StarkEx was not merely a commercial commitment; rather, it was a commitment to the company’s technological development,” he stated.

“This is a clear indication that you will have everything at your disposal to operate it without relying on Starkware,” the speaker said.

Starkware’s programming language and EVM rival, Cairo 1.0, as well as Papyrus Full node, have both been open-sourced, and the company is now in the process of open-sourcing their newest sequencer.

The Starkware Sessions conference was kicked off on Sunday in Tel Aviv by Ben-Sasson. According to the event’s organisers, it is the biggest layer 2 conference that has been hosted up to this point.

Around 500 visitors and engineers were in attendance when he made the statement. “This is a watershed moment for scaling Ethereum,” he said. It will establish Stark technology as a public asset that can be put to use for the common welfare of all people, which is the proper position for it.

Block's 5nm Bitcoin Mining Chip Prototype

The financial services and technology business Block, which is controlled by Jack Dorsey, has just finished the prototype design of its new 5nm Bitcoin mining chip. This was done with the intention of decentralizing the supply of Bitcoin mining rigs. The business noted that the development of Bitcoin mining ASIC rigs is both financially and technically hard, which has led to an excessive concentration of the ownership of specialized mining silicon in the hands of a few number of enterprises. It is believed that miners and the Bitcoin network as a whole would suffer from the negative effects of this concentration.

In response, Block intends to make Bitcoin mining technology open source wherever it is feasible by selling standalone ASICs and other hardware components. This move is intended to enhance the size of the Bitcoin mining hardware ecosystem while also maximizing the amount of innovation that may occur inside it. Because of the actions taken by the firm over the previous few months, it will now be able to experiment with new designs, which will help the company bring Bitcoin mining chips to market that are both more efficient and less expensive.

As a means of accelerating this development drive, Block has made a significant purchase of ASIC chips from Intel, prompting the latter to stop accepting new orders for its Blockscale 1000 Series ASICs. This move was made in order to shorten the development cycle. Block expects that by purchasing these ASICs from Intel, it would be able to speed up the development of its own 3nm chip, which, upon its eventual release, the company says will be the most technologically sophisticated semiconductor to date.

The significance of ASIC development to the Bitcoin mining process is reflected in Block’s concentration on the development of these devices. ASICs are computerized devices that are tailored to accomplish a particular computational function. They are commonly used for mining proof-of-work cryptocurrencies like Bitcoin, which need a specific computational task to be completed. When individual components of a chip get smaller, it becomes possible to pack more transistors into a silicon die of the same size. This results in increased overall efficiency and a reduction in the amount of heat that is generated.

Although 5nm ASIC chips have been available for some time, the first 5nm ASIC was not released until 2021 by the Chinese mining company Canaan. Despite this, no company has yet made the ASIC chip designs that they produce open source. It is anticipated that Block’s dedication to open source technology will have a substantial influence on the Bitcoin mining business. This will result in additional alternatives being available to miners and will contribute to the network’s efforts to become more decentralized.

Jack Dorsey's Block Appoints MIT's Neha Narula to Board of Directors

Block, Inc. (NYSE: SQ), a global technology company with a focus on financial services, announced on July 27, 2023, the appointment of Neha Narula, Director of the Digital Currency Initiative at the MIT Media Lab, to its Board of Directors. This move further solidifies Block’s commitment to leveraging open source software and open protocols to transform the way people move money.

Narula, who has been serving as the Director of the Digital Currency Initiative at the MIT Media Lab since January 2017, brings a wealth of expertise in Bitcoin and open source technology to the board.

Prior to joining MIT, she held a position as a senior software engineer at Google. Narula also currently serves on the Federal Reserve Bank of New York’s Innovation Advisory Council. Her academic credentials include a B.A. in Mathematics and Computer Science from Dartmouth College and a Master’s degree and a Ph.D. in Computer Science from MIT.

“I’ve long admired Block’s focus on building simple, cohesive products that empower people and communities to participate in the financial system,” said Narula. “We share core values around the power of open source software and the ability for open protocols to transform the way people move money. I’m honored and excited to join Block’s board of directors and contribute to the company’s purpose of economic empowerment.”

Block’s Head and Chairman, Jack Dorsey, expressed his enthusiasm about Narula’s appointment, stating, “Neha’s expertise in Bitcoin and open source technology is a great addition to our Board. Neha’s passion for building intuitive, scaled systems to move money across the Internet efficiently fits into our company’s purpose, and we’re excited to have her join our team.”

Block, Inc., formerly known as Square, Inc., is composed of Square, Cash App, Spiral, TIDAL, and TBD. The company is dedicated to creating tools that expand access to the economy. Its integrated ecosystem of commerce solutions, business software, and banking services helps sellers run and grow their businesses.

With Cash App, anyone can easily send, spend, or invest their money in stocks or Bitcoin. Spiral builds and funds free, open-source Bitcoin projects, while TIDAL provides a platform for musicians and their fans to connect more deeply. TBD is building an open developer platform to make it easier to access Bitcoin and other blockchain technologies without having to go through an institution.

Narula’s appointment to the board is expected to further enhance Block’s mission of economic empowerment through the use of open source software and open protocols.

Uniswap V4 Open-Source Directory Sparks Controversy Over New KYC Hook

The unveiling of an open-source directory dedicated to Uniswap v4 hooks has recently incited discord within the cryptocurrency realm. At the heart of the contention is a newly introduced hook, now accessible on this directory. This hook facilitates the execution of Know Your Customer (KYC) checks on users prior to engaging in token pool trading activities, thereby intertwining regulatory compliance with decentralized operations, a notion often deemed incongruent in the decentralized finance (DeFi) domain.

In the technical lexicon, a hook is defined as a tool that empowers developers to modify code without altering the core architecture of the software. This capability is often termed as “hookability.” In the forthcoming Uniswap version 4, this particular hook will equip developers with the means to incorporate KYC verification within the decentralized financial protocol, marking a significant stride towards bridging the gap between regulatory mandates and decentralized operations.

Know Your Customer (KYC) is a standard practice among financial institutions aimed at validating the identity of clients and evaluating the associated business risks. Primarily, KYC endeavors to curb money laundering and thwart the financial conduits to terrorist entities. This practice, while common in traditional finance, is viewed with skepticism within the DeFi sector due to its centralized nature and potential infringement on privacy.

A proactive community developer integrated the KYC hook into the Uniswap v4 directory as an opt-in feature, granting users the autonomy to choose its application. However, the prerequisite to complete the KYC verification is the possession of a non-fungible token (NFT), an innovative digital asset verifying the uniqueness of an item or individual in the digital realm.

The introduction of this hook comes at a time when the decentralized finance (DeFi) sector is under amplified governmental scrutiny globally. Regulatory bodies across various jurisdictions are endeavoring to rein in the freewheeling DeFi sector, which often operates outside the conventional financial regulatory framework.

The forthcoming public release of Uniswap v4, slated for early 2024, will delineate access to pre-sanctioned organizations only, as per governance mandates. Additionally, the updated version will feature hooks for aesthetic customization, reflecting a balance between user personalization and regulatory compliance.

The amalgamation of KYC procedures within a prominent DeFi protocol like Uniswap signifies a notable paradigm shift, potentially setting a precedent for other DeFi platforms to follow suit. This juxtaposition of regulatory compliance with decentralized ethos is poised to foster heated debates within the crypto community, as it navigates the complex terrain of global financial regulations.

dYdX Transitions to Public Benefit Corporation

In a bid to realign its organizational structure with the broader interests of the web3 community, dYdX Trading Inc. has amended its charter to transition into a Public Benefit Corporation (PBC). This change was publicly announced on 17 October 2023 by Antonio, the founder of dYdX, through a series of tweets. The key objective behind this transition is to foster economic and technological advancements globally, especially by democratizing access to financial opportunities through decentralized and open-source crypto asset exchanges among other technologies.

Antonio divulged that dYdX’s new status as a PBC will not alter its for-profit nature. However, it does enable the board and himself to focus not just on maximizing shareholder value but acting in the public interest. This strategic shift reflects a growing commitment to aligning with the builders, traders, and stakeholders within the web3 community, beyond just the shareholders. dYdX views this transition as an innovative step not only in product and technology but also in legal and organizational structure, marking a historic moment in the decentralized finance (DeFi) sector. This is noted to be the first instance where a major DeFi corporation has morphed into a Public Benefit Corporation.

The amendment to the charter articulates the specific public benefit that dYdX aims to promote. In Antonio’s words, “The specific public benefit to be promoted by this corporation is building and supporting protocols that, and industry members who, promote and facilitate economic or technological advancement of the global community, including but not limited to the democratization of access to financial opportunity through open source and decentralized crypto asset exchanges and other technologies.” The new charter mandates the company to balance the interests of various stakeholders, thus not solely concentrating on shareholder value.

Community responses have been largely supportive, with some urging dYdX to publish the exact wording of their charter as an additional step towards transparency. The notion of returning the fees from the previous version (v3) to adhere to the new charter’s principles was also brought up by a community member. These interactions highlight the community’s keen interest in dYdX’s move towards a more open and aligned operational framework.

The company anticipates the dYdX Chain’s open-source release, underscoring the pivotal role the v4 open source code will play in realizing their mission of democratizing financial access. The change is also seen as a response to the evolving global economic conditions, emphasizing the necessity for transparent, open, and permissionless financial products.

RISC Zero Announces Open Sourcing of Key Technological Innovations

RISC Zero, a Seattle-based pioneer in zero-knowledge (ZK) virtual machine technology, has announced a groundbreaking initiative. Through a series of tweets, the company revealed its plan to open source three major technological innovations: High-Speed Recursion, Proof Composition, and a STARK-to-SNARK Wrapper. These contributions, earmarked for release under the Apache2 licensing structure, represent a major commitment to transparency, agency, and integrity within the tech community.

Detailed Breakdown of RISC Zero’s Innovations

High-Speed Recursion: This technology aims to redefine the capabilities of private computing systems. It enables the creation of fast, scalable systems with the unique feature of sub-second proof recursion. This can significantly enhance the performance and scalability of blockchain and cryptographic applications.

Proof Composition: A novel approach to verifying one zkVM proof within another, this innovation is set to improve the reliability and security of zkVM applications. It allows for more complex and interconnected cryptographic operations, enhancing the overall utility of ZK systems.

STARK-to-SNARK Wrapper: Focused on onchain applications, this tool addresses the challenge of proof size and efficiency. By shrinking proofs, it facilitates smoother and more efficient integration of applications onto blockchain platforms.

Implications and Impact of Open Sourcing

By open-sourcing these technologies, RISC Zero not only contributes valuable tools to the developer community but also reinforces its position as a leader in OSS contributions. This move is expected to accelerate innovation in zero-knowledge cryptography, a field critical for ensuring privacy and security in decentralized computing and blockchain systems.

It’s important to contextualize this announcement with RISC Zero’s previous achievement of securing $40 million in a Series A funding round in July 2023. This investment, led by prominent players like Blockchain Capital, has enabled RISC Zero to push the boundaries in ZK technology development, culminating in these latest open-source offerings. The funding has been pivotal in advancing RISC Zero’s mission and enhancing its technological capabilities.

RISC Zero’s mission revolves around empowering developers and infrastructure providers with cutting-edge cryptographic tools. These tools are critical for building trustless, scalable, and decentralized computation solutions, both on and off chain. The company’s innovative zkVM technology, enabling the use of conventional programming languages like Rust and C++ for building ZK applications, signifies a breakthrough in blockchain technology.

RISC Zero’s latest announcement is more than just a contribution of tools; it’s a reinforcement of the company’s dedication to the ethos of open-source development and a testament to its vision of a more secure and efficient digital world. These innovations are set to transform the landscape of zero-knowledge cryptography and blockchain technology, enabling developers to create solutions that were once thought impossible.