Abstract
Stakenet is a decentralized platform providing a trustless interchain economy. It is powered by a Proof of Stake blockchain with Lightning Network, Masternodes, and dApps. Its use case is to provide a highly secure cross-chain platform for cryptocurrencies, where individuals can easily operate with any blockchain simply by using Stakenet and its native currency XSN.
1 Introduction
In the last few years, the cryptocurrency community has steadily grown. There are now hundreds of cryptocurrencies to choose from – with more appearing each passing day. It is important to understand which technologies, communities, and decentralized ledger technologies will separate themselves from the rest, pushing through the noise of constant ventures entering the crypto-sphere. Instead of a one chain rule, we believe the future will instead be in the formation of a global backend – a blockchain mesh consisting of every chain, technology, and service created thus far. A united network of different chains all communicating with each other through different interfaces. This conversation will be completely unbeknownst to end users as swaps between different chains will be done case by case on the backend – never seen, realized, or even chosen by the user.
1.1 Purpose of Stakenet
While most associate the word stake with staking, stake has its roots in the economics of business administration and stands for far more than just passive income. Stakenet is more than staking; it is a network for stakeholders. To cre- ate a common understanding, we need to define the term network and connect it to the appropriate definition of a stake and a stakeholder.
− A network is defined as a system consisting of many similar parts that are connected.
− A stake is defined as a vital interest in a business or its activities.
− A stakeholder is any person or society at large that has an internal or external stake in the vision and mission of a business.
Thus, anyone who is actively or passively influenced by the activities of cryp- tocurrencies becomes a stakeholder of the blockchain economy. This includes ownership and holding of coins, property and legal interests, economic and social dependencies, developer and community activity, and any other crypto related work or interest. That way, cryptocurrency stakeholders:
− Affect the blockchain economy.
− Are affected by the blockchain economy.
− Be both affected the blockchain economy and affect the blockchain economy.
Putting all this together, we can start to see the vision Stakenet is pursuing. A technical architecture to connect all the stakeholders of the blockchain economy into one giant network – the Stakenet.
1.2 Plan of action
To create a successful interchain solution for the blockchain economy, we need to identify the majority of its stakeholders, find a way to connect them, and ensure that our approach does not harm their integrity. Therefore, the following three sub-items are particularly important for our plan of action.
1) Identify the majority: The most common stakeholder in the blockchain economy is Bitcoin itself, which is a peer-to-peer version of electronic cash growing stronger day by day. Most notably gaining major traction and a wide audience these past few years. Nowadays, countless people are affected by Bitcoin, and in return, also affect Bitcoin due to their work and activities. This includes the mining industry, financial products, dif- ferent wallet solutions, and many other Bitcoin-related work. In addition to Bitcoin, blockchains with smart contract capacities are particularly well-known too. The beauty of their blockchain architecture is that they enable both side and subchain creation. This allows for the development of decentralized applications, or dApps. The best-known smart contract blockchain is Ethereum which hosts the largest number of tokens for dif- ferent blockchain related businesses. Another famous blockchain with a similar use case is EOS which is currently the most used blockchain in the space of cryptocurrencies. Both blockchains are individually affected by internal and external interests, too. There is not a single blockchain where the stakeholder approach is not used.
2) Connect the majority: After finding out who our stakeholders are, we need to find a way to connect them. Bridging the gap between blockchains will be possible if both chains are using a compatible interface, like second layer protocols, or are supporting the same cryptographic hash function. That given, it is possible to execute trustless transactions between different blockchains. In Bitcoin’s case, we can utilize the Lightning Network as the default interface for peering two different chains, as we have already done with Bitcoin, Litecoin, and Stakenet. Other blockchains such as Ethereum or EOS can be integrated into our stakeholder network via their own smart-contract language. We will develop XSNETH and XSNEOS tokens to swap trustlessly between our native chain and the opposing chain with the help of hash time locked contracts, or HTLCs. The usage of hashlocks and timelocks provides us a solution to lock XSN on our native chain while unlocking the corresponding XSN tokens on the smart contract chain and swap these tokens in the opposing side and subchain mesh with other cryptographic currencies. Besides the exchange of coins and tokens, connecting the stakeholders of blockchains also means that you need to integrate the periphery industries of these blockchains as well. Therefore, we drafted a solution for decentralized mining pools, cross-chain staking, and the hosting of dApps with interfaces to other chains’ applications, too.
3) Protect integrity: All these ideas would be empty words if we just developed another centralized solution. We protect everyone’s integrity by combining the advantages of different blockchains into one interchain management architecture. The key pillars are our very own Trustless Proof of Stake consensus, an upgraded Masternode layer with watchtower functionality, and an upgraded Lightning Network layer with specialized swap resolvers. As well as several products, one of which is our hardware device XSN Viper – used for storing, exchanging, and utilizing different chains native assets and tools.
In short, Stakenet connects the largest distributed network developments into one decentralized place where individuals can operate with any blockchain simply by using Stakenet as the default interface.