Blockchain technology introduced a real paradigm shift in 2009 with the emergence of Bitcoin.
Since then, developers and the community have continued to innovate, transforming blockchain from a technology that allows relatively simple transactions to be carried out at high energy cost, to a powerful technology that enables programmable transactions at low energy cost.
The so-called “1st-generation” protocols:
Like Bitcoin, the 1st generation protocols use proof-of-work (PoW) consensus. This first-generation protocol enabled the technology to be dematerialised, but suffers from a number of shortcomings:
- With ≈ 8 transactions per second and an average wait of 30 minutes (1 block + 2 blocks to limit the risk of forks or “stale blocks”) for validating a transaction, the Bitcoin network may have its limitations for some use cases,
- With limited smart contract technology, Bitcoin does not permit the development of highly advanced use cases,
- The proof-of-work consensus mechanism provides strong security but is very energy-intensive, and therefore difficult to reconcile with environmental issues.
The so-called “2nd-generation” protocols:
Like Ethereum, 2nd generation protocols provide a stable development environment (the Ethereum Virtual Machine) that permits the development of extended use cases. However, these protocols do not resolve the following issues:
- Interoperability between blockchains
- The carbon footprint of the network, which is still a consensus based on proof of work
- Scalability of the protocol
The so-called “3rd-generation” protocols:
Like Tezos, 3rd-generation protocols seek to address all the issues raised by 1st and 2nd-generation protocols.
For example, the problem of energy consumption is solved through the use of a proof-of-stake (PoS) consensus. This reduces the calculations required to validate a block: network security is now based on the possession of tokens, instead of on computing power. To validate a block and secure the network, participants must pledge part of their tokens and, in the case of Tezos for example, they can lose them (“slashing”) if they engage in hostile behaviour towards the network.
With its Liquid Proof-of-Stake protocol and its system of adding and validating blocks referred to as “baking” (see “What is baking?”), the Tezos blockchain significantly reduces the energy required to deliver a high-performance service.
The resources required to operate a Tezos node are modest, and the challenge lies no longer in computing power (CPU, GPU or specialised chip) but in the stability of the infrastructure.
The choice of Tezos technology was a natural one to support our customers wanting access to a node for their applications. Exaion was closely monitoring changes to the protocol.
Exaion was attracted to Tezos’ “on-chain” governance philosophy, which limits the use of forks for updates and allows the community to participate in future developments to the protocol.
Moreover, the choice of a language that facilitates validation by formal proof offers additional security and is directly aimed at professions with demanding code reliability requirements, such as the banking sector or high-tech industry.
The designers of the Tezos blockchain and its tools have made life easier for developers with development kits that bridge the gap between the most widely used languages (Python, etc.) and Michelson (Tezos’ language for smart contracts). As Michelson is a stack language, with no variables, smart contract developers prefer to write their contracts in a higher-level language (via libraries such as SmartPy or Ligo), leaving the compiler to produce the corresponding Michelson code.
Exaion’s intention is to make blockchain accessible to large groups by establishing itself as a preferred partner. Exaion supports companies from the ideation phase through to the application development phase, and then to hosting on its own infrastructure.
Firstly, Exaion provides its customers with a stable node hosted on dedicated industrial-grade infrastructure. The node has also been built to ensure maximum stability for our customers, and for those who wish to participate in the consensus by delegating their XTZ tokens (see: “How can I participate in the consensus via the Exaion node?”).
Next, Exaion uses the node as a gateway for its internal applications and for its customers’ applications. In addition to “baking”, the node also allows applications to be deployed on the blockchain.
Tailor-made services for our clients will gradually be added to the node (custody, gas financing for smart contracts, custom development of smart contracts, etc.)
You can delegate from the interface of your usual wallet (e.g.: Ledger), stating the following delegation address: tz1gcna2xxZj2eNp1LaMyAhVJ49mEFj4FH26
Exaion’s intention is to strike a balance between the growth of the node and remuneration to the delegates. Consequently, the remuneration policy will be implemented in three stages:
- Preparation phase: 4% charge over a reduced period of 2 weeks for the stabilisation and densification of the node.
- Consolidation phase: 7% fee. The XTZs from the applied fees will be automatically reinvested in the node to increase the number of rolls, and thus increase the node’s weighting in the network – and thus, ultimately, the overall profitability of the node. During this phase, Exaion will regularly add new rolls to the node to enable it to keep pace with the growth in the number of delegates.
- Production phase: 5% reduced fee. The XTZs from the fees will be used to finance the gas for the application/DApp transactions of the node’s users.
Baking is the process by which the network ensures its own security and stability. It also implements the protocol’s business model by creating new XTZs with each new block.
In practical terms, the security process is as follows:
- Every period, one baker is chosen as the “master” and 32 other bakers are chosen as “supporters”.
- In most cases, a block takes about 60 seconds to be presented by the “baker”, get the support of the “supporters” and take its place in the blockchain.
- With each block, the “baker” pledges part of his 8,000 XTZ roll, which he recovers at the end if the block is validated. This is a measure designed to punish attempts to corrupt the Tezos blockchain by deliberately introducing false or corrupted blocks into the blockchain.
- At the end of the validation process, the “baker” gets back the XTZs he has put up as collateral, and obtains a reward which he shares with the “supporters”.
- The cycle then starts again with 1 new “baker” and 32 new “supporters”.
In order to be selected more regularly and obtain more rewards, the baker can “commit” more XTZs or increase the number of XTZ delegated to him – subject to having at least 8.25% of the XTZs delegated to him (committed). For example, for 8,000 XTZs (1 roll), a node can host approximately 96,969 XTZs (this figure also varies with the total number of XTZs available or locked on the network).
No, any individual can “delegate” their tokens (XTZs) by lending them to a “baker”. The loan works automatically and securely. The “delegated” tokens remain the property of the individual, who can retrieve them at any time. Moreover, the baker cannot perform any action on these “delegated” tokens, and nor do they appear on his accounts. This means that if the baker’s private key is stolen, the delegated tokens are not compromised and remain the property of the individual.
Exaion, a subsidiary of the EDF Group, is becoming a “baker” on the Tezos blockchain
The selection of a 3rd-generation blockchain such as Tezos reinforces Exaion’s commitment to limiting the digital footprint of the blockchain business. Exaion customers will have full, easy access to a Tezos node.