Giuliano Giacaglia

Why Farcaster is special

giacaglia@newsletter.paragraph.com (Giuliano Giacaglia) — Sun, 10 Jul 2022 17:55:03 GMT

Farcaster is a sufficiently decentralized social network. It is an open protocol that can support many clients, just like email. Farcaster was co-founded by Dan Romero and Varun Srinivasan. Both co-founders have extend experience in the crypto space at Coinbase.

Social protocols are open data graphs where users own the relationship with their audience, and developers can read and build on top of the graph without any limitation. Farcaster is a social protocol, but the team is also building a great product on top of the protocol. Let’s go over a few reasons why I think Farcaster is special:

Product focused

The protocol is the base layer behind the product. But the product is always improving and it is a delight to use. Farcaster started with a desktop app and now there is a mobile app to interact with the protocol. They include features like posting text, image and recasting posts.

They also have some quirky and really cool features that are built for the crypto community. For example, if you write gm or gn at the beginning of a sentence, there will be special buttons with gm and gn. Both the desktop app and the mobile app are easy to use and new features and bug fixes are rolled out almost every week.

Permissionless innovation

Even though the protocol has been in private beta, there are a number of applications being built on top of the graph and the content. None of these apps required an API key. You just need an internet connection, a laptop and a willingness to build something. These apps demonstrate the power of decentralization and how powerful a protocol can be. The more apps are built, the more the protocol becomes valuable, creating more opportunity to new apps to be build on top of it. It is a great flywheel.

As Chris Dixon stated, composability is to software as compounding interest is to finance. Some of the apps that were already built on top of Farcaster:

Instacaster - All the images built on top of Farcaster are published here.
Searchcaster - Search for any cast in the platform
CastRSS - RSS feed for Farcaster
Configcaster: When a user uses “Connect Wallet” for an app / website, their config is automatically imported and any sensitive data can be requested by the app and approved by the user in a single click

Crypto focused

Farcaster is built on top of Ethereum. Whenever you create your account, you can link your Ethereum address to your account. That allows Farcaster to build a lot of native integrations on top of Ethereum.

For example, a lot of the early users have NFTs linked to their profile picture. NFTs owned are marked with the purple checkmark! The timeline also features any new transactions buying new NFTs or any new collections. The Farcaster app also features the top NFT collections that users in the platform own. There will be more features built on top as the Ethereum community grows.

The community

Farcaster has an amazing early community. The community was chosen with intent by the founders. When you use the app, you can feel the positivity of the early community. That is a breath of fresh air compared to other social media apps that are very toxic. The engagement for a lot of early users is much higher compared to other social apps. For example, in a simple post that I had, I got almost 30 likes and a few comments. On other social apps, it is the norm for me to not get any engagement.

A post with a bit more engagement than on other social media apps

Other users have pointed out that the number of followers that they have in Farcaster already surpassed the number that they have in other social media apps. In my personal experience, I have a lot more engaged followers and the number of followers in Farcaster will surpass the number of followers elsewhere. I’ve spent a lot of time building my presence on other social media apps and started focusing my time more on Farcaster.

Conclusion

Farcaster has the chance to win because it has the technical capabilities, the right community and the right product. Farcaster is special and it is one of the best products coming out of this crypto cycle.

How Solana scales maintaining decentralization

giacaglia@newsletter.paragraph.com (Giuliano Giacaglia) — Wed, 15 Dec 2021 06:17:39 GMT

Solana scales to 65k transactions per second, while other popular blockchains do not scale as much. For example, the average Bitcoin network processes around 7 transactions per second, and the Ethereum network processes around 15 transactions per second.

The Ethereum network plans to switch to proof-of-stake and there are other layer 2 solutions that improve the throughput of the network. In the meantime Solana presents a much higher throughput than Ethereum.

Usually when blockchains increase throughput, they increase centralization. That’s known as the Scalability Trilemma, first defined by Vitalik here. It states that if you stick to "simple" techniques, you can only get two of those three. The three properties are:

Scalability: the chain can process more transactions than a single regular node (think: a consumer laptop) can verify.
Decentralization: the chain can run without any trust dependencies on a small group of large centralized actors. This is typically interpreted to mean that there should not be any trust (or even honest-majority assumption) of a set of nodes that you cannot join with just a consumer laptop.
Security: the chain can resist a large percentage of participating nodes trying to attack it (ideally 50%; anything above 25% is fine, 5% is definitely not fine).

So given that Solana processes around 65k transactions per second, is it more centralized than other networks?

Nakamoto Coefficient

The first part of this is to analyze the Nakamoto Coefficient, which was introduced by @balajis:

https://news.earn.com/quantifying-decentralization-e39db233c28e

If we look at Solana’s Nakamoto Coefficient, it is around 19. On the other end of the stick there is Ethereum, which only needs 3 miner pools to collide. Practically, Ethereum’s Nakamoto Coefficient is 3.

Now how does Solana achieve such a high throughput without compromising with centralization. It solves with a clever design. Let’s go through it

Solana’s design

Technically, proof-of-work and proof-of-stake are not consensus protocols by themselves, but they are often referred to as such for simplicity. They are actually Sybil resistance mechanisms and block author selectors; they are a way to decide who is the author of the latest block. It's this Sybil resistance mechanism combined with a chain selection rule that makes up a true consensus mechanism.

A chain selection rule is used to decide which chain is the "correct" chain. Ethereum and Bitcoin currently use the "longest chain" rule, which means that whichever blockchain is the longest will be the one the rest of the nodes accept as valid and work with. For proof-of-work chains, the longest chain is determined by the chain's total cumulative proof-of-work difficulty.

When transactions occur, they are timestamped according to their local system clock. Then, when other nodes verify the transactions, messages about their confirmation or rejection are also timestamped. The inherent discrepancies between local system clocks (even those from nodes acting in good faith) ultimately pave a path for attacks where bad actors can try to take over a cryptocurrency network using fake transaction broadcasts that closely approximate real timestamps — for example, “fake stake” (or “resource exhaustion”) attacks in the case of PoS, and Denial-of-Service (DoS) attacks in the case of PoW. To ensure that transactions have not been manipulated and that funds are spent only once, a lot of time and processing power needs to be dedicated to verifying timestamp accuracy in a PoW or PoS system.

For Solana, this problem is solved by the creation of Proof of History. In this way, nodes can guarantee that there was an amount of time that has passed by using a verifiable delay function. And using it, Solana guarantees that there are clocks that are “synchronized”.

When all the respective clocks across the decentralized network are synchronized, transactions take much less time to verify because individual nodes do not have to dedicate so much processing power toward verifying various timestamps. This synchronization allows the network to optimize for speed, and as a result, the Solana blockchain is inherently fast and engineered for native scalability — enabling higher energy efficiency and higher security through the low processing power and the tamper-resistant nature of its synchronized timestamps. Solana’s efforts to boost transaction speed rely on a semi-centralized structure in which a node leader is elected and all nodes agree to adopt one universal source of time.

Solana is fast because it uses a pre-determined leader schedule that all validators calculate the same way without having to communicate with each other since the schedule is a function of data already on the blockchain.

Solana’s built-in mechanism for synchronizing time across nodes helps the network support a theoretical peak capacity of 65,000 transactions per second, currently

Blocks are only accepted if they follow that leader schedule. In this way, random validators cannot insert themselves into the schedule.

To prevent validators from 'skipping' the validator that comes before them, Proof of History is used to force all validators to spend a minimum amount of time before they could even submit their block. Thus if validator B follows validator A, B cannot try to skip A by chaining off its previous block, because B has to run the Proof of History algorithm at least as long as A does, so A will get a fair chance of submitting their block.