You’ve probably noticed the Decentralized Finance (DeFi) ‘explosion’. It would have been hard not to. The amount of money locked in DeFi just continues to make all-time highs and DeFi related tokens have been performing extremely well.
It’s hardly surprising, since DeFi is getting quite advanced and the benefits for users are becoming impressive. When banks are offering less than 1% interest and DeFi can provide double digit interest rates, or even triple digits if you’re crafty, it makes sense why DeFi is catching on quickly.
But DeFi relies on decentralized applications (dapps) and aleph.im believes that this is a problem. Existing dapps usually have one of the following problems, according to aleph.im:
- They are slow,
- They are unreliable,
- They aren’t interoperable, instead they are tied to a single blockchain, such as Ethereum.
It is thought that dapps are going to have to overcome these issues if they want to succeed and achieve mainstream adoption, and this includes DeFi. Ultimately it comes down to scalability – if these problems are going to prevent dapps scaling, then these applications cannot be used by the masses.
That’s what aleph.im is here to try and solve, by creating a solution that can enhance interoperability and scalability for dapps.
aleph.im is a cross-blockchain network specifically focused on decentralized applications and their related infrastructure like storage, computing servers and security. aleph.im aims to solve the issues of dapps and DeFi by offering a fast single cross-technology and cross-chain solution on a decentralized and reliable ecosystem.
A lot of information is siloed due to the vast amount of competing blockchains. With a solution like aleph.im bridging blockchains together, suddenly the ecosystem becomes whole and can interact between chains, unlocking a whole new potential.
One interesting ambition that the aleph.im project has is to ‘decentralize the last mile of DeFi’. While you may not be aware of it, decentralized applications commonly rely on some form of centralized entity, be it a price oracle, an order book, a routing engine or anything else. It’s been shown before that when a decentralized application utilizes a centralized component it can be exploited. aleph.im aims to use their network to allow dapps and DeFi applications to become completely decentralized.
How it works
By using aleph.im, transactions and messages signed on supported blockchains can be instantly accepted on the aleph.im network. These messages can come from anywhere, such as dapps, IoT devices and more. Once the messages have been received the aleph.im network processes them along with any applications running on the aleph.im network. As of now aleph.im supports Ethereum, Binance Chain, NULS and Neo.
This process introduces a whole new dimension to the dapp ecosystem. It enables a second layer that can interconnect between multiple blockchains, essentially creating a bridge between them all.
aleph.im also allows much cheaper, or even feeless, interaction with dapps for users by offering the ability for bulk content writing onto the blockchain which enables fee-less commits. This is achieved by agents committing messages on the blockchain and spending the native chain asset but receiving the aleph.im network token.
The ALEPH Token
The aleph.im token (ALEPH) is the native token of the ecosystem and is used to reward activity on the network. There are three main token use cases:
- Reward each signed message written to the underlying blockchain
- Reward storage of application data and availability of API, both of which are mandatory for nodes
- Computing payment (to pay for computing on the network)
There are also a few ways you can earn tokens in the aleph.im network too:
- Run nodes and stake on the nodes (details to be announced soon)
- Stake NULS on pocm.nuls.io to get ALEPH tokens: currently ~15k ALEPH per day shared between all stakers
- aleph.im has also begun to incentivize liquidity providers on the Uniswap pools with ALEPH tokens. Approximately 15,000 ALEPH will be distributed each day, which will be proportionally shared to liquidity providers.
Decentralized applications are starting to take off, largely thanks to the growth of DeFi. However, aleph.im has flagged a number of flaws that they believe will prevent mass adoption. In response they have created aleph.im, a blockchain network that allows different blockchains to communicate while increasing the scalability and speed and reducing transaction costs.
The Daily Chain
*This article has been sponsored. The Daily Chain encourages you to carry out your own research before you make any form of investment and educate yourself about how to stay safe in the crypto space.