Zilliqa is a blockchain-based network that claims to be the portal to the blockchain world. Most blockchain users often complain about the scalability issues of leading blockchain networks like Bitcoin and Ethereum.
ZIL was primarily designed to solve the scalability issue. Its developers claim that it’s the first cryptocurrency network that completely relies on sharding to fix the scalability issue.
What Makes Zilliqa Unique?
Zilliqa is often referred to as an Ethereum killer because it supports the development of decentralized applications and smart contracts. Unlike Ethereum, Zilliqa can process thousands of transactions per second because it incorporates the sharding technique to fix the scalability issue.
Zilliqa network consists of a set of blockchains that are running in parallel. The verification process takes place on the parallel chains while the final block is updated on the main blockchain.
Scilla (Smart Contract Intermediate-Level Language)
Zilliqa uses a custom programming language, Scilla, for the creation of decentralized apps and Defi services. The purpose of using a custom programming language is to secure smart contracts from hacking attempts. The developers can easily identify security vulnerabilities using this language.
It ultimately helps them with creating safe and secure smart contracts. Zilliqa network uses this language to ensure the overall security of the network because smart contracts hold valuable digital assets and they’re irreversible.
ZILHive
ZILHive is one of the main components of the Zilliqa network that is designed to streamline the mass adoption of blockchain. This feature is designed to assist the developers gradually so they may successfully launch their projects on the blockchain.
Zilliqa Brief History
Zilliqa was introduced as a blockchain thesis project by the National University of Singapore. Its white paper was written by Loi Luu and Prateek Saxena. Xinshu Dong, Jia Yaoqi, and Amrit Kumar co-founded this project.
The project was officially launched in 2017. Zilliqa’s team raised around $22 million during the initial coin offering in 2017. The team introduced the custom programming language, Scilla, in May 2018. The testnet was launched in November 2018 and the mainnet finally went live in January 2019.
How Does Zilliqa Work?
Zilliqa doesn’t only support transaction settlement but it can also be used for building smart contracts and decentralized applications.
Sharding
Unlike other blockchain networks, Zilliqa uses a sharded architecture for transaction processing. The transaction processing speed of the blockchain networks is significantly affected once the usage grows. Zilliqa tries to address this problem by dividing its network into small groups of nodes known as shards.
No matter how big the network grows, its transaction speed won’t be affected because the shards are designed to process the transactions in parallel. Zilliqa even supports micro-payments on its network because it doesn’t require any confirmation for the processed transactions.
Sharding eliminates transaction backlogs, network congestion, and scalability issues. Thus, it helps with keeping the transaction fee as low as possible. Currently, the users need to pay around 0.1ZIL tokens to complete a transaction.
The network participants have the power to increase or decrease the transaction fee depending on the user demand, transaction volume, and the market price of ZIL.
Shard Layer – Shard Layers are used to process small pieces of larger blocks. The node operators of these layers can quickly verify the transactions as they only need access to a limited amount of data.
DS Layer – This layer randomly chooses node operators to create a single block with the microblocks collected from different shards. These node operators can make final decisions on individual blocks because they have direct access to the main blockchain.
Proof-of-Work
Like Bitcoin, Zilliqa uses a proof-of-work consensus protocol for validating transactions. The miners can validate the transaction by using their computational power. They receive ZIL tokens as a reward for their participation.
Practical Byzantine Fault Tolerance
Zilliqa syncs the distributed network of nodes with the help of a governance mechanism called Practical Byzantine Fault Tolerance (pBFT). The users need to stake their ZIL tokens to become node operators.
The Practical Byzantine Fault Tolerance adds a microblock into a transaction block after getting confirmation from all the members of a particular shard. Thus, the rewards are equally distributed among the users who have participated in the validation process.
Governance
Zilliqa gives governance rights to its community members. It means the community members have complete control over deciding the future of the network. However, they need to have governance ZIL (gZIL) tokens in their wallets to propose or vote for new changes within the network.
Every gZIL token represents one vote. So, the voting power of a community member is determined based on the gZIL tokens they hold. The token holders can also earn rewards by staking their gZIL tokens. gZIL tokens can be purchased from popular crypto exchanges.
Zilliqa Tokenomics
ZIL is the native token of the Zilliqa network that is used for the transfer of value. The users can also stake their ZIL tokens to become node operators. They then receive ZIL tokens as a reward for validating transactions.
With a circulating supply of 13 billion tokens, ZIL has a market cap of $484.7 million. It has a maximum supply of 21 billion tokens that will be released in the form of rewards. ZIL ranks among the 100 best cryptocurrencies in terms of market cap.
Conclusion
Zilliqa is a blockchain network designed to address one of the most important issues of existing blockchain networks. It enables users to build smart contracts and decentralized applications using its custom programming language called Scilla. It uses the sharding technique to divide the transactions into smaller pieces.
Thus, it completes the transactions faster than other blockchain networks. If you need more information about how Zilliqa works, feel free to get in touch with us.
