Elrond (ERD)
A Scalable Value Transfer Protocol For The Digital Economy.- Elrond is a high-throughput public blockchain focused on providing security, efficiency, scalability, and interoperability by employing two key elements: Adaptive State Sharding and a new Secure Proof of Stake ("SPoS") consensus mechanism.
- Elrond's blockchain protocol for smart contracts & dApps can process over +10k transaction per seconds with low block times (5s), negligible transaction fees, and with fast finality for cross shard transactions in a matter of seconds.
- The Adaptive State Sharding, works via shard merges & splits for unlimited scalability, and uses a fully sharded Architecture, which includes state, transactions, and network. This architecture is deemed highly resilient against malicious attacks due to validators shuffling between shards.
- Elrond features smart-contract royalties, where 30% of the fees can be reallocated to the smart contract author.
- ERD is the native asset of Elrond and is used to pay for transaction fees and the cost of deploying dApps on the network, along with rewards for various contributions to the network.
1. What is Elrond (ERD)?
Elrond is a high-throughput public blockchain focused on providing security, efficiency, scalability, and interoperability by employing two key elements: Adaptive State Sharding and a new Secure Proof of Stake ("SPoS") consensus mechanism.
Elrond's testnet is already live and can process upwards of 10K TPS, with 5-second latency and minimal cost (based on 5 shards). The Project aims to be a platform for easy deployment of programmable money and dApps, thus becoming the backbone of an open, permissionless, borderless, globally accessible internet economy.
Elrond's goal is to be a high throughput, fast transaction speed, and low transaction cost platform, allowing efficient and competitive dApp user experiences in real world use cases.
Elrond believes that its high scalability, fast transaction speed, and low transaction cost makes it well-suited for machine-to-machine transactions and the IoT economy.
Some of its key elements include:
- Elrond is a high-throughput public blockchain aimed at providing security, efficiency, scalability, and interoperability via Adaptive State Sharding and a Secure Proof of Stake consensus mechanism.
- Elrond is built by a team of entrepreneurs, engineers and researchers with technical experience at Google, Microsoft, Intel, NTT, a PhD in Computer Science ("CS"), and blockchain backgrounds, including being previously part of the NEM core team.
- Elrond is currently in the testnet phase and aims to be a platform for easy deployment of programmable money and dApps, thus becoming the backbone of an open, permissionless, borderless, globally accessible internet economy.
Elrond is a complete redesign of blockchain architecture with the aim to achieve global scalability and near instant transaction speed. Elrond focuses on combining these key innovations:
- State sharding (transaction, data & network sharding); adaptivity through shard merges and shard splits.
- Consensus in two communication rounds with modified Boneh–Lynn–Shacham ("BLS") multi-signatures.
- High resiliency to malicious attacks due to intra and cross shard node reshuffling.
- Secure randomness beacon with BLS signing.
- Smart contracts on a state sharded architecture with balanced load on shards.
- Fast finality for cross shard transactions (seconds).
2. Blockchain and network data
The blockchain has low system requirements and can run on anything from an ordinary computer to T2 medium AWS machines.
The blockchain features epochs of ~24 hours and rounds of ~5 seconds. All the validators in Elrond's network will be split among multiple shards, where they will only have to synchronize the state for the current shards and process transactions only for their current shard. In order to prevent collusion amongst validators, up to ⅓ of the validators in a shard will be reshuffled to other shards at the end of every epoch. Liveness is not affected by this because the fast state synchronization for the newly reshuffled validators needs to synchronize only the state for the current epoch (~24 hours timeframe), while the remaining ⅔ of the unshuffled validators in the shard can still process transactions.
Each shard will consist of 400-600 validators and have a separate chain, accounts and application state. The consensus group (currently set to be n=63) changes every round based on a randomness seed stored in the previous block's header. These validators in the consensus group need to agree on the proposed block in every round of every epoch.
Based on the randomness source in the previous block, n validators are chosen using a deterministic function. Every other validator in the shard can compute the n validators and verify the correctness of this nomination. The first selected validator will be the block proposer for the current round.
The block proposer signs the previous randomness source with a BLS single signature to generate the next randomness source, creates a block with transactions, adds the new randomness source in the block header and broadcasts this block to consensus group members.
Each member validates the block, also validating that the new randomness source is a signature verifiable with the leader's public key on the old randomness source. If both are valid, it creates a BLS signature on the proposed block and sends this back to the leader.
The block proposer selects from among all received signatures, creating a subset of at least ⅔*n + 1 signatures, and creates a bitmap for his selection, where B[i]=1 if the ith member of consensus group was selected and B[i]=0 otherwise. The proposer then aggregates the signatures and attaches the bitmap and signature to the block. It must also sign the end result to "seal" the configuration for (B[ ], aggSig) before propagating the resulted block through gossip inside the shard.
Cross-shard transaction processing
For an in-depth example of how the cross-shard transactions are being executed and how the communication between shards and the metachain occurs, the entire process is illustrated using the simple two shard case and the metachain as shown in the figure below.
The strategy for processing one cross-shard transaction is to use an asynchronous model. Validation and processing is done first in the sender's shard, notarized in the metachain and then finalized in the receiver's shard.
- Step 1: The cross-shard transactions are first processed and added to a block in the sender's shard. The transaction value has thus been deducted from the sender's account.
- Step 2: The block header is sent to the metachain where it is added to a metablock.
- Step 3: The metablock arrives in the destination shard and then needs to be processed there. The destination shard requests the transaction from the sender's shard (if missing).
- Step 4: The transaction is then added in a block in the destination shard and the block header is sent to the metachain. As a result, the transaction value has been added to the recipient account.
- Step 5: The metachain notarizes the block that includes the processed transaction in the destination shard and the transaction is then finalized.
This iteration consists of static state sharding, secure proof of stake consensus, Schnorr signature for transactions, BLS signatures for random seed generation, and modified BLS multisig for blocksigning.
Metrics that are being monitored to check improvement of the network include: latency, bandwidth limitations, running each validator node on a separate machine with very limited compute power (average dual-core CPU with 4GB of memory), and different geographic locations.
Key stats for the current testnet are as follows:
- Sharding setup: 5 Shards + Metachain
- Nodes: 500 x AWS T2.medium (validator nodes) and AWS 12 x T2.large (observer nodes)
- Nodes per shard: 83
- Consensus: BLS round every 6 seconds on each shard
- Consensus size: 63 nodes per shard
- Max-Blocksize: ~800KB
- Peak-TPS: ~12,500
The team is working on improving the network stack used for communication to reduce the bandwidth and network overhead within the consensus group of each shard.
Another improvement from the initial prototype architecture, has been upgrading the consensus model to reduce the number of communication rounds between consensus groups on each shard from 5 to 2.
An illustration of Elrond's latest implementation of Secure Proof of Stake is as follows:
An illustration of Elrond's Adaptive State Sharding Approach is as follows:
The upcoming testnet releases will include a public adversary game (Battle of Stakes) that will combine all the metrics together and will produce the highest level of stressing the protocol, allowing us to improve and find new opportunities for improvement. New stress results will follow in the upcoming weeks.
Development toolkit
Writing Smart Contracts on Elrond is made easy by frameworks in Rust, C, C++ and other languages compiling down to WASM. The erdpy back-end is a complete CLI & Python SDK for building, deploying and interacting with Smart Contracts. The erdjs framework allows for front-ends to be deployed using TypeScript & JavaScript and makes testing easy with tools such as Mocha.
The Elrond Integrated Development Environment is available via the Microsoft marketplace as a Visual Studio Code extension. Its integration with the SC framework allows developers to focus solely on smart contract logic and handles boilerplate code, dependencies and inheritances, while offering a transparent debugging interface.
3. Economics and supply
3.1 Key metrics
| Token Name | ERD |
|---|---|
| Token Type | BEP2 in testnet phase |
| Total Token Supply | 20,000,000,000 ERD |
| Initial Circulating Supply | 7,498,333,333 ERD (37.5% of total supply) |
| Launchpad Allocation | 5,000,000,000 ERD (25% of total supply) |
| Launchpad Sale Token Price | 1 ERD = 0.00065 USD (price in BNB TBD) |
| Launchpad Raise | 3,250,000 USD |
| Private Sale Allocation | 3,800,000,000 ERD (19% of total supply) |
| Private Sale Token Price | 1 ERD = 0.00050 USD |
| Private Sale Date (start to end) | April 2019 - May 2019 |
| Amount Raised Private Sale | 1,900,000 USD |
3.2 Token supply distribution
- Launchpad sale tokens comprise 25% of total supply.
- Private sale tokens comprise 19% of total supply.
- Team tokens comprise 19% of total supply.
- Reserve tokens comprise 17% of total supply.
- Advisors received 2.5% of total supply.
- Ecosystem Rewards tokens comprise 7% of total supply.
- Marketing tokens comprise 8.5% of total supply.
- Community tokens comprise 2% of total supply.
ERC token supply distribution (%)
Private Sale overview
It was conducted in April and May 2019 for 3,800,000,000 ERD at a rate of 1 ERD = 0.00050 USD and raised a total of 1,900,000 USD, selling 19% of the total token supply.
Binance Launchpad Sale overview
The sale was conducted in June 2019 for a total raise of 3,250,000 USD worth of BNB at 0.00065 USD per ERD token, selling 25% of the total token supply. ERD/BNB exchange rate will be determined prior to the date of sale.
Elrond token ecosystem
The Elrond token (ERD)'s uses include, but are not limited to: payment for transaction fees and payment for the cost of deploying dApps on the network and rewards for various contributions to the network.
During its first few years, the project's main focus will be on establishing Elrond as a global public utility within the internet ecosystem, offering a scalable, efficient, and interoperable blockchain architecture, only accessible through ERD tokens. All activity within the network (i.e., making transactions, running smart contracts, providing services like staking, or running a validator node) will be fueled by the ERD token. Both startups and large-scale enterprises will be able to build decentralized applications on top of Elrond's network and integrate Elrond as part of their infrastructure solution for products and services.
3.3 Token governance and use of funds
As of the June 2019, Elrond has used approximately 5% of TGE funds according to the breakdown below:
- R&D - 62.00%.
- Operational - 17.00%.
- Marketing/PR - 11.60%.
- Business Development - 5.50%.
- Legal & Audit - 3.90%.
Elrond plans to hold sufficient fiat reserves to fund the operational costs for at least 18 months. The rest of any funds held in crypto will be stored in cold wallets with multisig support.
3.4 ERD token release schedule
The following chart represents the number and breakdown of all ERD tokens that are intended to be released into circulation on a monthly basis.
ERD token release schedule
3.5 Token overview and use cases
The use cases intended for ERD include but are not limited to: (1) payment for transaction fees, (2) payment for the cost of deploying dApps and (3) rewards for staking and various contributions to the network.
- The ERD token is used to stake and participate in the Secure Proof of Stake consensus of the network.
- In addition, the ERD token is used to pay for transactions, storage fees, and as gas. The token also serves as rewards to the SPoS validators.
- The ERD token will also be used for voting and on-chain governance at a later stage, once on-chain governance is enabled.
- In Elrond, rewards are paid through an emission of ERD defined in the protocol. The majority of all newly issued ERD will go to validators, while a very small part will go to a reserve pool. The reserve pool will be used to fund development and ecosystem expansion, increasing the security and value of the network in the long term.
- 10% of fees and rewards are collected by the Protocol Treasury, which is used for the sustainable development of the Elrond ecosystem.
4. Roadmap, updates, and business development
4.1 Initial roadmap
| Planned Date | Milestone | Actual Date | Timing | Comments |
|---|---|---|---|---|
| 2018: Q2 | Technical paper (release 1): First formalization of Adaptive state sharding and Secure Proof of Stake | 2018: Q2 | On Time | Formal design of Elrond architecture presented |
| 2018: Q3 | Prototype Launch | 2018: Q3 | On Time | Achieved 1,000+TPS with 250 nodes on 10 shards Medium |
| 2018: Q4 | Open source & whitepaper update | 2018: Q4 | On Time | Github Technical Paper |
| 2019: Q1 | Elrond testnet v0.5 initial results | 2019: Q1 | On time | Validating new implementation in Golang with performance increase up to 3,750+ TPS on a single shard Demo |
| 2019: Q2 | Testnet launch | 2019 Q2 | On Time | Testnet max TPS exceeded 12,000 with 5 shards Youtube |
| 2019: Q2 | Elrond block explorer & wallet launch | 2019: Q2 | On Time | Explorer Wallet |
4.2 Updated roadmap
Q2 2019
- Private testnet launch.
- Implement cross-shard communication.
- Initiate consensus node reshuffling.
- Implement BLS single sig for randomness generation.
- Add BLS multisig for consensus signature aggregation.
- Launch Elrond block explorer & wallet.
Q3 2019
- Public testnet launch.
- Launch VM Integration.
- Finalize Elrond Game dApp.
- Finalize Elrond token economics.
- Develop shard adaptivity.
- Develop shard pruning.
- Complete security audit.
- Launch global community PR & marketing.
- Ecosystem expansion: sign 5 MoUs for business partnerships, 1 hackathon.
Q4 2019
- Elrond mainnet launch.
- Initiate token swap and staking.
- Implement functional payment gateway.
- Launch of Elrond dApp store.
- Launch of Elrond name service.
- Ecosystem expansion: sign 10 MoUs for business partnerships, 2 hackathons.
- Launch local community PR & marketing.
Q1 2020
- Introduce Elrond digital identity.
- Launch Elrond DEX.
Q2 2020
- Launch of the native Elrond wallet.
- Release of economic model improvement proposal.
Q3 2020
- Launch of the Validator Staking program.
- Release of the Smart Contract Royalty program.
Q4 2020
- Release of Sharded Name Service.
- Foundational nodes decommissioning.
Q1 2021
- Release of Blockchain API landscape.
- Launch of digital identity products.
- Improving privacy & interoperability.
4.3 Commercial partnership and business development progress
In order to drive adoption and build a robust ecosystem, Elrond has partnered with several companies and blockchain projects, including the following:
- Samsung: Samsung is a South Korean multinational technology conglomerate. Elrond entered a collaboration with Samsung and released the Battle of Elrond mobile game with blockchain integration, exclusively Samsung’s flagship smartphones.
- Global Digital Assets Corporation (GDAC): GDAC works with high growth economies and regions to enable innovation, boost economies and help to create new jobs. Elrond and GDAC are exploring the implementation of fast payments & clearance networks, as well as the definition and implementation of smart contract frameworks.
- [BUSD:] BUSD will use the Elrond Standard Digital Token model, which makes token transfers as fast and inexpensive as the native protocol coin.
- Industrial Internet Consortium: The Industrial Internet Consortium aims to transform business and society by accelerating the adoption of the Industrial Internet of Things (IIoT). Elrond and the Consortium members are working together to develop business solutions.
- Netopia: Netopia is an electronic payment processor from Southeast Europe. Elrond and Netopia aim to jointly explore the potential of integrating ERD into the Netopia payment platform.
- TypingDNA: TypingDNA is a behavioral biometrics company, protecting online users based on how they type on their keyboards. Elrond and TypingDNA aim to explore the integration of TypingDNA biometrics solutions into the Elrond platform and future products in order to improve security.
- SmartBill: SmartBill is a fintech company providing SaaS-based services to small, and medium-sized businesses for invoicing, accounting and inventory management. Elrond and SmartBill aim to explore the potential integration of the two platforms to provide to their users and clients blockchain-based features for transparency or traceability.
- NASH (formerly known as NEX): NASH is a decentalized cryptocurrency exchange. Elrond and Nash aim to explore the potential integration of Elrond blockchain platform ERD into the NASH payment platform, allowing their users and clients to trade and acquire ERD tokens across different platforms.
- Distributed Systems Research Laboratory (DSRL): DSRL is a laboratory focusing on distributed systems related research areas such as machine learning, big data analytics, and IOT. Elrond and DSRL aim to collaborate on Blockchain Research and educational initiatives.
5. Project team
6. Elrond's activity and community overview
6.1 Development activity
6.2 Social and community data
General community growth strategy
By leveraging social mining through its community platform, the Elrond team employs an open bounty and reputation system to continuously engage its community and grow the Elrond ecosystem. Through this system, the Elrond team has focused on constant and inclusive interaction, and is regularly devising campaigns to consolidate the community.
The team is also constantly engaging with key opinion leaders from various countries, to grow outreach and raise awareness about Elrond.
- At a rather early stage of the project, Elrond open sourced their prototype, starting a conversation with developers about the latest innovations in the space.
- Releasing the testnet wallet gave everyone the opportunity to interact directly with the Elrond blockchain, and provide useful feedback.
- The Battle of Stakes program, slated to be released in Q3 2019, is designed to encourage testnet participants to collude and take over the network.
- Through hackathons, the Elrond team opens up the opportunity for enterprises and developers to fully test the network and complete challenges.
- At a later stage, the Elrond team intends to launch a few bug bounty programs to speed up development.
The team plans to continue their AMA series targeting specific regions of the world. Next AMAs will focus on Asia, Russia, and Central Europe, and will be conducted in multiple languages.
Growth strategy through events and conferences
Elrond has been present at a few significant conferences and technical events such as SFBW, Devcon, Blockchain Malta Summit, and have also held a number of local meetups to get first hand feedback from the community.
More events (to be announced) are lined up where the team will showcase their testnet demo and discuss other partnership opportunities.
Community and social channels
Telegram (English)
Telegram (German)
Telegram (Romanian)
Twitter (English)
Medium (English)
Facebook (English)
LinkedIn (English)
Reddit (English)
BitcoinTalk (English)
7. Appendix
7.1 Elrond testnet
7.2 Advisors
- Raul Jordan (Ethereum core developer)
- Alex Iskold (Partner at 2048 Ventures, former Managing Director at Techstars NYC)
- Fabio C. Canesin (Co-Founder of City of Zion and Nash (former NEX))
- Alex Tabarrok (Professor of Economics at George Mason University)
- Grigore Rosu (Professor in the Department of Computer Science at UIUC)
- Andrei Pitis (VP of Engineering and Head of Bucharest Office at Fitbit)
- Ethan Fast (CS PhD from Stanford, Co-Founder of City of Zion and Nash (former NEX))
7.3 Reviews
7.4 Videos and interviews
- Testnet Launch Video
- OhHeyMatty Elrond AMA - Blockchain For Programmable Money Unstoppable Applications
- OhHeyMatty Elrond Blockchain Technical Project Review (2019)
- Crypto Lark Supercharged Blockchain Ready to Shock Crypto Into The Mainstream- Elrond
- G Crypto Elrond overview
- Iaroslav Korobeinikov Elrond project presentation
- Incrypted Обзор Elrond. Масштабируемый блокчейн с Комьюнити программой
- CryptoSherlock Co. Elrond - блокчейн проект с программой Social Mining
7.5 Podcast, AMA, and conferences
7.6 Media mentions
- Forbes: What Could "Sharding" Mean For Enterprise Blockchain Adoption?
- Reuters: This Computer Science Breakthrough Could Reshape the Digital Economy
- Altcoinera: Elrond Network can potentially handle the transactional demands of the entire IoT Market.
- TechBullion: TechBullion Exclusive Interview with Beniamin Mincu, CEO of Elrond
- EU Startups: 10 Romanian startups to look out for in 2019 and beyond
- Coinspeaker: Scaling Up to Better Blockchain
- AMBCrypto: Can Sharding solve the public blockchain scalability problem? Elrond believes It can!
- Oracle Times: Lowering the Barrier to Cryptocurrency Adoption With Layer One Scaling
- ChipIn: Elrond's Push to Be The Next Scalable Proof-of-Stake Public Blockchain
- Hackernoon: How To Use Sharding Without Sacrificing Security
- Krypto Money: Two Years in the making, this Blockchain is finally Ready for Mass-Utility
- Investor online: Elrond Network and NASH Collaboration
- CryptoNea: Elrond and the Blockchain Trilemma
- CCN: Elrond – Infrastructure for the New Digital Economy