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Hi Cardano Community,

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Okay, now let’s dive into today's topics. This is what we have for you today:

• 🔥Cardano and Radix: Competing for the Future of Distributed Ledger Technology

• 💎 Gem of the Week

TL;DR

• Radix is a novel distributed ledger technology platform, aiming to overcome the limitations of current networks.

• Compared to networks like Cardano, Radix is currently less decentralized, particularly in terms of initial coin and validator distribution.

• The PoS network's reward distribution, which is proportional to stake, poses a challenge for decentralization if initial distribution leans towards centralization.

• The upcoming Babylon and Xi'an upgrades will introduce smart contract capabilities and aim for infinite linear scalability and unlimited atomic composability, potentially marking a significant milestone in distributed ledger technology.

Ok, let’s dive in👇

What is Radix?

Radix is a novel distributed ledger technology platform, aiming to provide a scalable, secure, and efficient infrastructure for the transfer and storage of digital assets.

Radix offers a stack of technologies that enable users and developers to access and participate in its operation. The usage of this network is facilitated through its native token, XRD.

It aims to overcome the limitations of existing blockchain technologies and enable the widespread adoption of decentralized solutions.

Key Components of the Radix

1. Sharding:

The Radix sharding model partitions data into multiple independent shards, each functioning as a separate blockchain. This allows for parallel transaction processing, enhancing system scalability.

Each shard handles a subset of transactions, enabling concurrent processing and increasing throughput. The model supports horizontal scaling to accommodate more transactions and users.

Instead of using the traditional "blocks" or global transaction ordering found in conventional blockchains, Radix's sharding model employs a massively-sharded data structure. This approach ensures that transactions only impact the relevant shards and can be processed concurrently.

Cross-shard communication ensures transaction integrity across shards, and the Cerberus consensus protocol, a 3-phase Byzantine Fault Tolerant protocol, maintains security and fault tolerance.

2. Cerberus Consensus Protocol:

Cerberus consensus protocol is a byzantine fault tolerant consensus mechanism, designed to facilitate secure and quick agreement among an open network of nodes on the state of transactions.

Cerberus stands out for its ability to handle multiple concurrent timelines, enforcing the order of related events, thus enabling safe parallelism of consensus through state sharding, significantly reducing throughput limitations.

So let’s take a look at how it works:

1. A single set of validators employs a standard blockchain consensus mechanism for managing a single shard.

2. Multiple sets of validators manage several groups of shards concurrently, a concept akin to existing blockchain sharding proposals. Radix's sharding model allows validators to transition between different validator sets as required.

3. Cerberus employs dynamic sets of validators and shards to achieve consensus across its shard space in parallel.

When transactions impact a group of shards, validator and shard sets are dynamically distributed across the shard space. This enables Cerberus to handle unrelated transactions concurrently, bypassing a significant scalability constraint of contemporary blockchains.

Recently, the academic paper evaluating the Cerberus consensus protocol was accepted to JSys, the Journal of Systems Research, after completing a rigorous peer review process.

3. Radix Engine:

The Radix Engine is the application layer of the Radix network. It is designed to provide a flexible and modular framework for building dApps and financial systems. The Radix Engine allows developers to specify transactional functionality in an "asset-oriented" fashion, modeling useful elements of everyday transactions such as identities, money, products, or property as separate functional components.

The Radix Engine is based on a state machine model, where each state machine represents a specific asset or functionality. These state machines are discrete and finite, allowing for efficient parallelization and scalability. The Radix Engine translates these state machines into particles, which are the discrete updates to the state machines. Each particle represents a specific action or change in the state of an asset.

The Radix Engine also provides a mechanism for specifying dependencies between particles. This allows for the creation of atoms, which are transactions containing a set of particles with explicit dependencies. Atoms are committed or rejected by the Cerberus consensus protocol, ensuring consensus on the order and validity of transactions.

The Radix Engine is designed to be modular and extensible, allowing developers to add new assets and functionalities as needed. It provides a high level of abstraction, allowing developers to focus on the business logic of their applications rather than the underlying infrastructure.

5. UTxO Model

Like Cardano’s E-UTxO model, Radix employs an enhanced UTXO (Unspent Transaction Output) model for its logic, where transactions are represented as inputs and outputs, creating a traceable record of asset ownership.

The Radix Engine extends this model to support a variety of assets and functionalities, modeling elements like identities and property as separate components within discrete finite state machines.

These components are translated into particles, representing specific actions or changes in asset state, and mapped to shards for efficient parallelization and scalability.

This approach provides fine-grained control over assets and their interactions, facilitating complex, modular transactions for decentralized applications and financial systems.

4. Scrypto Programming Language:

Scrypto, a language built upon Rust, is specifically tailored for the Radix Engine v2. While it maintains many of Rust's features, it incorporates additional functions and syntax for the Radix Engine.

Scrypto is an asset-oriented language that enables Rust-style logic to interact with data and assets, treating both as native, first-class citizens. Scrypto introduces the concepts of Resources, Buckets, and Vaults to manage assets such as tokens.

It also presents Components and Methods for implementing smart contract logic. All components originate from a blueprint, serving as a template for creating multiple component instances.

Scrypto offers a novel approach to handling transactions and accounts in an asset-oriented model. In the Radix Engine v2, an account is a unique type of component that, like all other components, holds vaults. Transactions outline the desired flow of user-controlled resources to other components.

For authorization, Scrypto introduces the concept of Badges. Badge resources function similarly to token resources, but they can be presented to another component without transferring ownership, making them suitable for complex authorization patterns.

Scrypto's goal is to streamline the development of DeFi applications. It enables developers to concentrate on their unique business logic while relying on the Radix Engine for intuitive and secure asset management.

As we have gone through the introduction to understand the vision of Radix, let's compare the status quo with one of the most decentralized PoS networks out there, Cardano.

So here is the Blockchain Trilemma as Assessment Framework

Let's take a look at certain metrics of Radix that determine its degree of

• Security

• Scalability &

• Decentralization

and how does it compare to Cardano?

Decentralization

General Decentralization Metrics:

Initial Token Distribution:

• Radix had an initial Token distribution with 28,6% going towards public sale & to community distribution.

• Compared to other Layer 1 chains like Ethereum and Cardano, the initial token allocation of Radix protocol is skewed towards insiders. For example, Ethereum and Cardano distributed around 80% of their tokens through a public sale.

• Compared to L1, like Solana & Avalanche, Radix allocated 28.6% to the public, whereas Solana just distributed 1% and Avalanche allocated 16%.

• So overall, the fairness and decentralization of Radix's initial token distribution is closer to Avalanche than to chains like Cardano or Ethereum.

The number of individual staked wallets & staking ratio

• Radix has a staking ratio of 35.9%, which reflects a relatively low level of participation.

• We could not find the exact number of Radix wallets participating in staking.

• Cardano has around 1.3 million unique staked wallets, and a staking ratio of 62.87%, which shows a relatively high level of participation.

• The number of staked wallets is not an exact representation of individuals staking, but it gives a relative idea about the participation of individuals in staking.

Permissioned vs. Permissionless Node (Yes/No):

Like Cardano, Radix is also a permissionless network.

The total number of active validator nodes/relay nodes/stake pools

• As of 18.06.2023, Radix has 183 validator nodes.

• Of these 183 Validators only 100 are participating in the validation of transactions. As of now Radix allows only a maximum of 100 validator nodes. These are selected based on the amount of stake XRD token holders have delegated to them.

  

• Compared with Cardano, which has more than 3188 validator nodes, Radix has a relatively low number of validators.

We are already seeing active Cardano community members starting to run Validator nodes in the Radix network.

Currently, this Validator node only has a stake of 100k XRD, which is far from sufficient for it to participate in validation.

If such new network participants could become successful network validators, this would be a positive sign. It could attract more enthusiastic participants from other networks to the Radix network.

Factors Enabling Decentralization:

Minimum hardware & connectivity requirements for running a validator node/relay nodes/stake pool:

• CPU: 8 cores is recommended

• Memory: Recommended RAM is 16GB

• Disk: 250 GB SSD.

• Monetary requirements: A validator on Radix requires 30 XRD to register as a validator node. However, under the current conditions, the validator must have a minimum of 5.7 million XRD staked or delegated to it before it can begin participating in the validation of transactions.

Source

Here are the requirements for running a Cardano validator node.

Security

General Security Metrics:

Cost of 51% attacks

• For an attacker to control 51% of the Radix network, it will cost over USD 110 million USD(51% of staking market cap), not factoring in the price appreciation that will occur with a buyer trying to purchase that much XRD.

Vulnerability to denial-of-service (DoS) and distributed denial-of-service (DDoS) attacks:

• Radix has a low vulnerability to such attacks.

Propagation network types (a peer-to-peer propagation network or a relay propagation)

• Radix has a peer-to-peer propagation network.

Factors Enabling Security:

Client Diversity:

• Currently, Radix has no client diversity.

Cardano has no client diversity.

Scalability

General Scalability Metrics:

Transaction throughput:

In the current state / Olympia mainnet Radix has a max throughput of 50 tps.

On the other hand, Cardano has a TPS of 20-30 TPS.

Transaction latency & finality time:

Currently, It takes around 5 seconds to achieve transaction finality.

Cardano has a transaction finality time of 5-10 minutes.

Upcoming Network Upgrades of Radix

• The Babylon upgrade, set for 31 July 2023, brings all the initial set of Scrypto/REv2 features from Alexandria to the Radix Public Network. It also introduces our unique approach to on-ledger development libraries, the Blueprint Catalog, and the Radix Developer Royalties system.

• The anticipated Xi’an upgrade, set for 2024, will introduce the fully sharded form of our Cerberus consensus protocol. Expected to provide Radix with infinite linear scalability and unlimited atomic composability, the Xi’an release marks a significant milestone.

Conclusion

Radix takes a fresh and innovative approach to building scalable distributed ledger technology.

The current Radix network is much less decentralized compared to networks like Cardano, especially when it comes to the fairness in initial coin distribution and validator distribution.

As a PoS network distributes the staking rewards based on the proportional stake in the system, an initial distribution that is skewed towards centralization presents a significant hurdle for a network aiming for decentralization.

The upcoming Babylon upgrade will introduce smart contract capability to Radix, and the much-anticipated Xi'an network upgrade in 2024 is expected to bring infinite linear scalability and unlimited atomic composability.

If Radix ends up fulfilling the scalability targets with its Xi'an network upgrade, it will be a revolutionary milestone in the history of distributed ledger technology.

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