Kadena vs. everyone else

We all know that Bitcoin solves the Byzantine Generals’ Problem as you can read from the creator. It’s about distributed trust. Bitcoin is proof of work (PoW). What it does not solve is Smart Contracts and scalability. There are blockchains that do have Smart Contracts like Ethereum but having problems with scalability and one might say, security. I don’t know the very basics of Proof of Stake (PoS) but it doesn’t sound that fundamentally transformative as PoW regarding distributed trust. If you read Satoshi’s original explanation you might even understand how it solves the problem. There’s a lot of power in the method and the explanation. Hard problems are usually easy to formulate but (near)impossible to solve. And that’s the beauty of it. Work of a great mind. Transformative technologies, especially ones that concern trust, have a much better chance of succeeding if most people can actually understand it. Just look at the dynamics of PoW. So many diverse participants do what they are meant to do. Why? Because of self interest. Formulate a plan, give participants the right incentive and they will do exactly as the plan prescribes. There’s no sheriff or central authority that needs to supervise. One might speculate that if a similar great plan could be formulated for society as a whole itself, then we wouldn’t need (as many) sheriffs or central authorities.

Let’s get back to Kadena and the other blockchains, but before that we need to mention Layer 1 and 2. Original blockchains with their entire infrastructure and native coin are called Layer 1. It’s like the operating system level. It takes care of every vital function. Everything else is built on top of it like applications on a computer operating system. I accept the fact that Layer 2 and less distributed networks do exist and some of those are doing really well but at the same time I’m also mad that the original transformative idea of a PoW blockchain is fading and the picture is muddied up with more centralized actors and networks. Consider that once Bitcoin took off, centralized exchanges were quick to follow. Why not distributed exchanges? Porbably the same reason Bitcoin succeded. Self interest. It’s just that the exchange part was not part of the original Bitcoin idea. Satoshi left it to future followers to solve.

Kadena is an excellent Layer 1 blockchain network. It brings some new transformational ideas for scalability and security. I’m not that good at the security part of it so I talk instead about the scalability aspect. Kadena has multiple parallel chain that are interlinked. The next block in every blockchain references the previous. In Kadena’s case it references some of the previous blocks of the parallel chains. What it means mostly is scalability. If one chain is fully utilized, another chain can be used. And there is no theoretical limit on the number of parallel chains. So in theory it can be infinitely scaled. In practice, at least it means of a lot of room to scale. That’s very important, because the cost to use the network and settle transactions (so called gas fees) can remain low, hopefully practically free. Imagine a financial network with zero cost transfers. Sounds fantastic and embodies a tranformative change from the current bank transfer networks. I’m not sure if any current Layer 1 network can claim this other than Kadena.

Another transformative idea from Kadena is to put a relational database behind it. It’s another practical trump card that makes it stand out from the rest. I’ve been an enterprise application developer most of my career. I can tell you that enterprise applications would not exist without relational databases. In the world of finance what you have is a lot of data. I would not dare to quantify it but it’s more than a lot. If you want to build something for finance what you don’t want to do is not involve a relational database. Yet, most Smart contract blockchain networks have done just that. No database. Kadena finally realized that that’s exactly what can make it a lot better and more practical. Congrats to the Kadena people for finding that insight.

I do own Kadena coins but this was not meant to be a promotion. I wanted to express how I see the current blockchains evolving and why I think Kadena is revolutionary.