Deep Dives
Staking Circle
Staking Circle
May 22, 2024
9 min read

Exploring Bitcoin L2s w/ Elastos

Exploring Bitcoin L2s w/ Elastos

Elastos is creating a secure, user-owned internet by integrating Bitcoin's reliability with its decentralized carrier network. In a recent AMA, Jonathan emphasized the ELA token's significance in network security as well as the Essentials wallet's decentralized identity. Upcoming developments include the CreDa credit system and improved governance via ELA staking.

Elastos also uses local nodes for data storage and merge mining with Bitcoin. The ecosystem supports innovative projects such as Elacity. Deep dive into Elastos' progress and join their community channels for additional information:

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  1. Elastos Overview
  2. Decentralized Carrier Network and Bel2 Protocol
  3. Bitcoin Integration and Security
  4. ELA Token Role in Ecosystem
  5. Developer Community and Resources
  6. Essentials Wallet and Identity Security
  7. Future Developments and Roadmap
  8. Staking and Super Nodes
  9. Ecosystem and Layer 2 (L2) Strategies
  10. Community Engagement and Information Resources

1. Elastos Overview

  • Jonathan from Elastos introduced the company and his role as the head of growth. He's responsible for marketing, business development, ecosystem alignment, and investors:

"Well, I'm the head of growth at Elastos, which means that I'm responsible for the marketing. I look after also the business development, ecosystem alignment and some of our investors.

  • Elastos aims to build a new internet where users can own and manage their data more securely and fairly:

"So I'm really excited because I see the potential right now for the whole idea behind Elastos really is this concept of being able to build a new internet, one that's based on certain principles around having the ability to own your data, to be able to manage some of your assets more equitably.

  • Talked about Elastos's Runtime technology, which lets developers create sophisticated peer-to-peer ecosystems:

"We have a fantastic technology concept called Runtime, which allows us to really build very sophisticated peer-to-peer ecosystems.

2. Decentralized Carrier Network and Bel2 Protocol

  • Jonathan explained Elastos's decentralized carrier network, which allows users to store their data on local nodes. This is key to creating a fully decentralized carrier system using DID technologies. This decentralized model can significantly help areas with poor carrier coverage due to its localized node structure:

"We're able to decentralize it around localized nodes so that... An individual can store their own data on that node and then the network using our DID technologies and actually our runtime technology can create a fully decentralized carrier ecosystem.

  • Bel2, pointed out by Jonathan as a focus area for Elastos, is a layer two communication protocol that facilitates efficient information transfer and scalability while reducing centralization risks:

"_I think, the kind of revolution in the last year and what we're looking at with what we call our Bitcoin Elastos layer two, which we call Bel2, just to save ourselves a tongue twister. So Bel2 is kind of our focus on moving up to that next layer.”

3. Bitcoin Token Role in Ecosystem

  • Elastos, as Jonathan stated, is merged mined with Bitcoin, using over 50% of Bitcoin's hash power to secure smart contracts:

"So, as I said, it's information transfer. By being merged mined with Bitcoin, Elastos has over 50% of the hash rate of Bitcoin. So we're able to generally offer a pretty secure system for securing these kind of contracts.

  • Uses ZK proofs for secure asset management on the Bitcoin network, ensuring transactions are verified for enhanced security:

"The use of the ZK proofs, and again, those are audited and have to be secured with third-party audit companies. So from a secure position, we believe we've got a very strong case.

4. ELA Token Role in Ecosystem

  • The ecosystem includes the Elastos Smart Chain and an identity chain. ELA enables various consensus protocols important for the system's functionality:

"ELA is merged mined with Bitcoin. Its role in the ecosystem is obviously it is able to secure the main chain, but we also have several other side chains, actually.

  • Talked about ELA's tight link with Bitcoin as a way to provide flexibility for community projects and resource development:

"Sometimes we refer as if bitcoin is the king we're kind of almost on the chessboard a bit like the queen and that we allow some of that flexibility that i just described in the l2 model to really work and create hopefully quite vibrant products and communities and resources that I was outlining.

5. Developer Community and Resources

  • Jonathan mentioned grant programs for non-infrastructure project building, highlighting Elacity as an example:

"So, you know, really this year, one of the exciting things is we've launched a series of grant programs to help develop some.

  • Elacity uses decentralized DRM through data capsules and access tokens, showing Elastos's commitment to supporting innovative community solutions:

"What Elacity does is it it has a marketplace but also it has an ability to create what we call decentralized DRM decentralized digital rights management you So what this means is actually using the runtime technology I mentioned, we're able to pass data capsules across the network and create what we call access tokens.

  • Announced the Elacity V2 launch, which introduces a new model for the content industries to control data, creative output, and revenues more independently:

"But the benefit is obviously that you control not just your data and not just your creative output, but the vast majority of the revenue that comes from that. So you don't have to hand over 65% to YouTube. You can keep 95%. You do pay 5% to the platform.

6. Essentials Wallet and Identity Security

  • Jonathan talked about the Essentials wallet, focusing on its use of a side chain for identity. It's noted that the wallet offers decentralized identity, which is essential for overcoming security challenges and scaling in Web3 environments:

"So we have a really interesting wallet called Essentials, which is what's really interesting about it is it's able to utilize our side chain for identity so it does all the things that a normal wallet can do but one of the issues that we're very focused on around security and scalability

  • The need to include verified credentials in the wallet was emphasized, given how easy and cheap ($15) it is to get a fake passport. This shows how important a more secure system is:

"And I think the important point with this is that also we're doing work with ensuring that verified credentials are added to that because obviously if your credentials, it costs $15 to get a fake passport these days. So if you are able to do that, then again, you're creating this false identity in the system.

  • The ability to build a life history with verified credentials was talked about as a security feature, even though copying someone's life history has limited financial value:

"Verified credential system that you can build via the wallet, you're able to, you know, basically create a whole life history.

7. Future Developments and Roadmap

  • Jonathan shared future plans, which include demos for loan products and the development of systems that share value happening on Bitcoin, thanks to a communication protocol:

"I mentioned that we're looking at demos for loan products, but obviously one of the things that having a communication, a protocol at that level enables is lots of data about what's happening on and around Bitcoin.

  • They introduced the " CreDa" credit system, designed to evaluate creditworthiness by using a BTC oracle for achieving global consensus:

"One of the product projects we work on there is actually a credit system which is called CreDa which allows you to create an oracle obviously we call this product BTC oracle and this particular product is a very specialized version of an oracle that looks at your credit worthiness.

  • Also talked about the prospects for AI integration in these systems and the effort to develop decentralized physical infrastructures:

"So I'm pretty excited about. how that product can evolve. It can also, being an oracle, it also can involve AI systems as well, and it can be federated and made extremely intelligent.

  • The importance of DAOs in promoting tech and knowledge advancements was highlighted:

"So, yeah, so that would be our next, our kind of another focus. And I know we're looking at DAOs to, you know, invest in thinking and technology and actually knowledge, to be honest. in that area of Deepin as well.

8. Staking and Super Nodes

  • Jonathan confirmed opportunities for ELA staking on super nodes, detailing a 36% interest rate for those who invest 5,000 ELA:

"You're able to stake your ELA and actually the current interest rate is 36% on those nodes and you have to down 5,000 ELA.

  • Elections for council memberships are currently ongoing, with 16 candidates competing for 12 seats, showing community involvement in governance through staked ELA:

"So we've got, I think for those 12 seats we've currently got 16 people looking to become members of the council, which lasts for a year. And that will be based on this, on staked ELA from the community.

  • Provided details on running common nodes with about a 27% interest rate, requiring a 2,000 ELA investment:

"Then we also have a system for running the ordinary nodes, of which we have around 80 to 100, optimally. The rewards go down. And again, that's 2,000 ELA to run one of those nodes. It's very simple. to set one up. And the current rate of interest on those is around 27%.

9. Ecosystem and Layer 2 (L2) Strategies

  • The talk touched on Elastos' work with various Bitcoin L2 solutions, highlighting diversity and their intention to avoid wrapped Bitcoin models:

"We do see multiple forms of L2. With the way our protocol works, we are building partnerships with many of these new Bitcoin layer twos. And, you know, for us, it's, you know, the more diversity, the better.

  • The role of data services was talked about in relation to enhancing partnerships with different L2 platforms:

"We're keen to help with as many L2s as possible and also provide some of the data services that I say are evolving from our model and work with. work with people to figure out the best use of that data.

  • A study led by the CEO of the Elacity project identified six or seven distinct L2 models, pointing to the ecosystem's openness to exploring diverse approaches to improve Bitcoin's functionality:

"We already found six or seven kinds of different models, you know, that sort of, you know, you could describe as an L2. And I think we've probably come across a couple more that can be categorized. So I think it's a really exciting time because, you know, there are multiple different approaches.

10. Community Engagement and Information Resources

  • Jonathan guided interested people to elastos.info for more information and spotlighted the active Telegram and Discord channels for community participation:

"So the starting point is elastos.info, which is our website and blog. Then I can share. our telegram is really active, we've got multiple different group ecosystems actually on that telegram, and then we've got a very strong Discord group so I can share some of those links with you and welcome people to join.

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