A Turing Award recipient has secured $35 million in funds for the development of a blockchain-based network that aims to solve the nascent technology’s scalability issue, Fortune’s crypto-focused news section The Ledger reported December 4.
Participated by some of the biggest investors in the industry including venture capital company Sequoia Capital, the recently completed funding round was led by China’s “godfather of computer science,” Turing Award recipient Dr. Andrew Chi-Chih Yao, along with several other academics. Launched by Singapore-registered Conflux Foundation, the venture will see the creation of a blockchain-type network dubbed “Conflux.”
With its new testnet touted to be capable of facilitating “at least 6,500 Transactions Per Second (TPS), while supporting at least 20,000 nodes,” the new network will seek to address blockchain technology’s most prevalent issue—scalability.
Apart from Sequoia, the venture is also reportedly backed by a number of prominent VC firms and tech companies, including FreesFund, Rong 360, IMO Ventures, F2Pool, Shunwei Capital, as well as high-profile digital currency exchanges like Huobi. According to the report, “a source close to Conflux” suggested that an undisclosed “prominent” Chinese internet search company has also pledged its support to the project.
As University of Toronto professor and Conflux co-founder Fan Long stated in the report:
“Conflux’s main idea is how to make the whole blockchain scalable. We’ve changed the structure of the blockchain so that it’s no longer a chain in the sense that it records each block based on what its parent block says […] Contrary to popular belief, true decentralization isn’t sacrificed to increase throughput.”
The project involves using a directed acyclic graph (DAG) which entails a topologically ordered system capable of simultaneously running different types of transactions on different chains. As it stands, the IOTA Foundation’s Tangle architecture is already anchored on the protocol.
The network merges DAG with a proof-of-work (PoW) consensus algorithm, enabling Conflux users to run both decentralized applications (DApps) as well as smart contracts. As Long explained, using a scalable, high-throughput protocol for running smart contracts and DApps allows both to gain traction beyond the Initial Coin Offering (ICO) sector.
The Foundation is set to release its testnet by the end of February next years, with its main network slated to be launched during the third quarter of 2019, Long noted.
While blockchain’s scalability has been a long-standing discussion among the community, a recently published study commissioned by capital market company Depository Trust & Clearing Corporation (DTCC) suggests that distributed ledger technologies (DLT) including blockchain can be scaled to facilitate daily trading volumes of the U.S. equity market.