An Introduction To SKALE

SKALE

Jun 09, 2020

6 min read

An Introduction To SKALE

Since its inception in early 2009, the blockchain industry has been challenged by what is known as the “Blockchain Trilemma”. That trilemma acknowledges the shortcomings of blockchains in one of three aspects: speed, decentralization, or security. While many blockchains aim to solve one of these dilemmas, it remains essential to ensure that projects capitalize on all three blockchain pillars for the long-term success and adaptability of the industry.

A possible solution for the blockchain trilemma might present itself as the scaling solution for the Ethereum ecosystem, known as SKALE Network. SKALE is a purpose-built blockchain scaling solution that introduces an interoperable network of sharded blockchains to the Ethereum network. The network aims to resolve decentralized networks' technical scalability, user experience, and cost issues. Additionally, SKALE is designed to bring an application-specific architecture to developers, improving configurability and modularity.

Now, what does that mean? The network aims to solve blockchain technology's limitations in relation to speed and capacity. It also works towards improving the user experience, making the platform and its applications easy to use for the mainstream public. Using SKALE, developers can quickly provision highly configurable scalable blockhains, known as SKALE chains, that are compatible with Ethereum and can process smart contracts.

A recent study by Dartmouth Blockchain has highlighted that Skale is the best performing blockchain when it comes to TPS with 397.7 TPS per Skale chain. Thanks to Skale modular architecture and linear scaling, as more nodes join the network, the capacity also grows.,100 SKALE Chains can process 39,770 TPS, and 1,000 Chains can process 397,700 TPS. On SKALE, decentralized applications can serve hundreds of millions of users with high throughput, seamlessly, securely and with instant finality.

Other blockchains could be faster but are limited by the need for every single node to validate and store the same information. So, increasing the number of nodes improves security and decentralization within those blockchains but usually doesn’t improve processing speed.

SKALE can use horizontal scaling to run hundreds of nodes. An increase in the number of nodes contributes to the rise in capacity, speed, and security. In the network, DApps are using subsets of thousands of nodes. Thousands of these subsets can serve thousands of DApps in parallel. Nodes within each subgroup are randomly selected and are interchangeable, which adds security to the network. This model is called Randomness Rotation Incentive scaling.

SKALE Chains first published by SKALE

A SKALE Chain refers to a Web3 EVM compatible modular blockchain designed to make Web3 cloud computing easier for dApp developers. SKALE Chains provide EVM compute power, decentralized database storage, and other functionality to help not only power your dApps but allow them to scale in a cost-effective manner.

SKALE Chains are powered by dockerized containers distributed over 16 randomly chosen nodes in a network of more than 130 nodes. Over 50 separate validator groups operate nodes. Proof-of-Stake from the validator and delegator communities secures each SKALE Chains node. The full status of the Skale network can be seen here: https://skale-analytics.skalelabs.com/#/dashboard

Every SKALE Network node dynamically delivers containerized Web3 compute resources that collaborate with other nodes. A SKALE Chain is made up of 16 randomly selected nodes, each of which runs containerized network clients with EVM and other services. All 16 of these skaled containers exchange network messages, transactions and blocks, and other encrypted data.

The selected subnodes are dynamically sized, participate in SKALE Consensus, run storage and Ethereum Virtual Machine (EVM), and make interchain communication possible. The SKALE Manager is located on the Ethereum Mainnet. Its purpose is to be an entry point to all other smart contracts within the SKALE ecosystem. This smart contract manages the orchestration of all entities in the network, including the creation and destruction of SKALE Chains and nodes, as well as withdrawals and rewards.

SKALE Smart Contract function first published by SKALE

It’s important to note that SKALE is not a singular blockchain network. Instead, it is a modular blockchain. Unlike monolithic Layer 1 blockchain networks, SKALE's Modular architecture means it is not capacity bound. SKALE is a network of blockchains, not a single blockchain. Furthermore, SKALE V2 allows Dapps to mint ERC Tokens/NFTs at no cost directly on SKALE and allows individuals to use Ethereum-created tokens.

SKALE V2, DApp, and NFT Scalability

As mentioned above, SKALE V2 introduces DApps that can mint ERC tokens and NFTs at no additional cost directly on the SKALE network. Now, you might wonder: “How does that work?”. Let’s have a look at the SKALEverse.

First, having an infinite number of blockchains provides limitless capacity, but may result in poor user experience and integration concerns without adequate interchain coordination. To prevent this problem from occurring, SKALE Chains are classified as either Hub Chains or Dapp Chains. SKALE Hubs act as service stations to the Dapp chains. Rather than having exchanges and markets on every single chain, which would result in fragmented liquidity, Hubs are designed to offer Dapp chains liquidity, swapping, and marketplace services. Furthermore, partner services such as oracles, indexers, fiat on/off ramps, and others can be hosted on hubs, which provide the key ecosystem of services required to run Dapps in the SKALEverse. Hubs are essential for ensuring appropriate token mapping and uniformity inside the SKALEverse.

Consensus and Governance

The SKALE Network is based on the Proof-of-Stake Consensus, which entails that each node must stake a predetermined amount of SKALE tokens to be slashed at the citation of any activity that is not allowed by the network. And just as in the case of traditional PoS, holders of SKALE can delegate their tokens to any node in the network - that doesn’t already own the maximum number of tokens - to stake/delegate. SKALE consensus allows for a leaderless, asynchronous, and byzantine fault-tolerant (BFT) network.

  • BFT - is the standard for security in distributed systems. BFT helps to guarantee that the network can always reach a consensus, even when a third party is malicious.
  • Asynchronous Protocol - this protocol recognizes latencies of nodes and the network, which allows messages to take an indefinite period of time to be delivered.
  • Leaderless Consensus - leaderlessness mitigates the possibility of collusion amongst network participants by ensuring everyone can propose and commit new blocks.

Governance

SKALE is a Web3 blockchain network that is open source. The SKALE Network is community run, many different DAOs, organizations and projects work together to promote, administer and regulate the network. Moreover, thousands of active community members contribute to the project in various ways, such as education, growth or through open-source code. SKALE Labs supports the network by making technical improvements and implementing new features.

The $SKL Token

The native digital asset of SKALE is simply called the SKALE Token (SKL). The digital asset lets you stake as a delegator, work as a validator, and access a share of resources by deploying and lets developers purchase their subscription access to SKALE chains (S-chains).

  • The max supply of SKL digital assets is set at 7 billion tokens.
  • There is no unbonding period.
  • Nodes can be slashed but won’t be slashed for poor performance.
Token Distribution $SKL first published by SKALE

Holders of SKL tokens can easily delegate their tokens to SKALE Node validators in order to earn staking rewards. Staking increases network security by resulting in the security collateralization of SKALE Chains, which Developers pay for in SKL tokens. The fees are returned to validators and delegators for providing network security and computing power.

Th SKL token has four main functions within the SKALE ecosystem. First, validation, execution and security. The SKL holders stake their SKL tokens to validators, such as Stakin, who run nodes to ensure the longevity of the blockchain network by validating blocks, executing smart contract and, of course, securing the network.

The second main function is rewards for validators and delegators. Those who stake their SKL receive staking rewards which are accumulated monthly. Third, the developer subscription fees; developers use SKL to pay for their subscription and access the SKALE chains. Finally, governance and voting will be on-chain and thus, the SKL token is used for depositing a governance proposal and voting.

Final Thoughts

Stakin is a dedicated validator for the SKALE blockchain network. With three Skale nodes on the Mainnet, including one public node, Stakin is providing infrastructure for over 60 million staked SKL. As an early Skale validator partner, Stakin has been involved since April 2020 and has participated in the Fuji and Kilimanjaro test networks. Stakin also provides support for all staking, unstaking, and network-related questions. Additionally, Stakin carefully reviews and accepts every staking request on a monthly basis before the network deadline at the end of the month.

Have a look at our website, https://stakin.com/stake/skale for more information about SKALE Network.


DISCLAIMER: This is not financial advice. Staking, delegation, and cryptocurrencies involve a high degree of risk, and there is always the possibility of loss, including the failure of all staked digital assets. Additionally, delegators are at risk of slashing in case of security or liveness faults on some protocols. We advise you to do your due diligence before choosing a validator.

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