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What Is Harmony - Proof of Stake and What Makes It So Iconic?

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April 13, 2022

Harmony is a layer-1 blockchain, enhanced its mainnet to support staking as it becomes the first blockchain to thrivingly incorporate Sharding and Proof-of-Staking. Subsequent to this, let’s take a deep look at this topic.

What Is Harmony?

Harmony is a fast and secured blockchain, founded in 2018 by Stephen Tse with a mainnet established in 2019. It is availing an Effective Proof of Stake (EPoS), which eliminates centralization while entitling stake delegation, reward compounding, and slashing for double-signing. 

Harmony supports 4 Shards of 1000 nodes, offering blocks in just 2 seconds with finality. It has its own launch partners including Binance, BitMax, and Huobi, together with professional validators such as Figment Networks and Stake.fish.

What Is the Token Called ‘ONE’?

‘ONE’ is the native token of Harmony, which highlights the objective of the protocol that assists open consensus for a large number of individuals. It can be used for multi-purposes like staking, mining, and rewards earning. 

It imparts governance rights to the holders. Therefore, they can participate in decisions concerning the future of the network through voting. Until March 2020, the token ONE has an inconstant inflation schedule. Then later, the rate of inflation gets altered to a fixed annual rate.

Like Bitcoin, Harmony ONE also has a limited supply. As per the CoinMarketCap, only 12.6 Billion ONE tokens are now available in the market. In it, 9.4 Billion have already been minted, and 15% of the tokens went to the founding team.

How Does Harmony Work?

Harmony Blockchain is carved up into four networks named “Shards” (of which, only Shard 0 is in use currently). Those split networks run in the same way into the blockchain while getting validated by a diverse group of stakeholders. 

With such random state sharding, Harmony achieves scalability, fast transactions, instant block generations, and strong prevention of network congestion.  

The process of Sharding is dependent on an adaptive Proof-of-Stake (PoS) consensus mechanism, which is based on a procedure called Distributed Randomness Generation (DRG). 

Such a blend in Harmony’s blockchain is empowering its profitability, security, and smart and simple verification processes. 

Pursuing,  Harmony is minimizing the communication costs by aggregating BLS (Boneh–Lynn–Shacham) signature signing in transactions. As a result, 250+ validators can achieve a consensus within two seconds.

Core Innovations of Harmony Blockchain

Complete Scalable Architecture

Harmony covers all three aspects of the blockchain, which are network, storage, and transaction processing. 

So that it is smartly possible with Harmony’s diverse sharding operations on the network communication, transaction validation, and blockchain state.

Asynchronous Cross-Shard Transactions

To accomplish the composability of assets and contracts between shards, Harmony empowers the cross-shard transaction into the network. 

Following a receipt-based asynchronous cross-shard communication mechanism by Harmony, achieving eventual consistency is smartly possible within shards. 

Profitable Network

Harmony designed its network based on the industry-leading peer-to-peer (P2P) protocol called libp2p. 

Right from its adoption of RaptorQ fountain code and adaptive Information Dispersal Algorithm (IDA) utilization, it achieves high performance in its operations focusing on huge profitability.

Fast and Efficient Consensus

Fast Byzantine Fault Tolerance (FBFT) is a highly efficient and speedy consensus algorithm of Harmony. It empowers the network in confirming new blocks within two seconds. 

As well, due to the FBFT being highly optimized in network message processing and block proposal pipelining, it is so efficient in scaling hundreds of validators concurrently.

Effective Proof-of-Stake

As mentioned, Harmony is the Proof-of-Stake blockchain, while traditional blockchains require Proof of Work (PoW) to achieve consensus. 

So, it would be very power-efficient and low-cost for node runners. In passing, its Efficient Proof of Stake (EPoS) for the process of electing validators enables robust security for all shards in the same breath.

Randomized Secure Sharding

The randomness of validators in assigning shards validations is probably more secure against shard attacks. It is optioned with a distributed random generation algorithm (on the basis of VRF and VDF) for an unpredictable and unbiased verification process. 

By utilizing the “Cuckoo Rule”, Harmony re-shards the network in an uninterruptible manner and avoids slowly adaptive byzantine adversaries.

The Future of Harmony Blockchain Network?

As Harmony introduces a feature allowing NFT lending and its own proprietary wallet to migrate its token from a Chrome extension to MetaMask, it has a bright future in the wind and a prosperous journey into the Web3 ecosystem. Harmony also created a 300 Million US Dollar fund called Harmony Grants that aims to finance additional research in the Proof-of-Stake field. Its Decentralized Autonomous Organization (DAO) set up to research zero-knowledge proofs (zk-proofs) system focuses on creating a way to communicate sensitive data across blockchains anonymously.

Conclusion

When it comes to the PoS Blockchains, the staking mechanism and the incentive models are two important components all the time. Considering all discussed, it is clear that the Harmony blockchain and its native token ‘ONE’ are worth your investment with the core facilities. 

If you would like to speak to our blockchain experts furtherly, feel free to chat with us on WhatsApp or Telegram or simply fill out the below-appearing form, so our team will contact you as soon as possible.

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