Ten ‘10x Moments’ Coming to Web3s

Ten ‘10x Moments’ Coming to Web3

March 13, 2023 | 8 min read

From Developer Experience (DX) to User Experience (UX), Radix is supercharging the entire Web3 stack. Making every element 10x better sums up to a big number; a really, really big number…

Web3 began with Bitcoin when the vapor of Austrian economics condensed into an engineering solution. Ethereum gave birth to decentralized finance (DeFi) and with every 10x improvement in speed, transaction costs, and security, even more use cases are annexed from TradFi into the decentralized future.

However, as Web3 speed-runs its evolution, scalability problems have led to Layer-1 (L1) nation states becoming Layer-2 (L2) city states, with all of the economic and social friction that entails.

One lesson from history is that trade is ruthlessly unsentimental - it migrates to wherever it is most welcome. In the 11th century, Florence was a pastoral backwater, but by 10x-ing its law, money and network it grew 25x in size and magnitudes more in wealth. Web3 is no different in principle and moves at 1000x the speed, as illustrated by blur.io unseating opensea.io in three months by 10x-ing its fee structure, user experience (UX), and liquidity.

In a few weeks’ time, [edit: Babylon is now live!] Radix will storm the citadels of Web3 with a network, language and constitution that, if successful, is again braced to turn shepherds into kings. Every one of Radix’s innovations is a 10x moment in itself, but compounded together they become an irresistible magnet for commerce and a candidate for the dominant Web3 protocol.

Exit Florence, enter Babylon…

1. Babylon

Let’s begin with a 100,000x moment.

Radix’s Babylon release will introduce several innovations that will combine to dramatically improve the utility and UX of Web3.

Native assets are especially transformative. Without them, Ethereum is stuck with a laborious peer-review process to agree standards on innovations like rental NFTs or soulbound tokens. These processes can take months. In contrast, adding access rules to tokens is trivial on Radix, requiring only single lines of code:

The following video takes a deeper dive into Radix’s implementation of soulbound tokens:

2. The Radix Engine

Native assets on Radix live in an application and execution environment called the Radix Engine, so-called because it acts like a physics / game engine that enforces asset and transaction rules by default. Just as Unreal Engine has transformed the gaming and VFX industries, the Radix Engine is a 10x for DeFi developers, who are free to build complex applications without worrying about basic logic and safety considerations.

3. Scrypto

Scrypto is a secure smart-contract language written in Rust and designed specifically for DeFi. Working with the Radix Engine, it reduces asset operations to single lines of code, making it possible to build complex decentralized applications (dApps) like Uniswap in 155 lines or others like chess that are barely feasible on Ethereum.

Data suggests that there are 14x more Rust developers than Solidity developers worldwide, and Github hosts ~29x more repos in Rust than Solidity. By building on Rust’s existing ecosystem and developer community, Scrypto significantly improves the DX for existing developers and reduces the barriers to entry for those new to DeFi.

The following video takes a deeper dive into how Scrypto 10x’s DX:

4. Cerberus

Radix’s founder Dan Hughes spent seven years testing the limits of distributed ledger technology before combining a pre-sharded architecture with the Tempo consensus mechanism to achieve 1.4m transactions per second (tps) in 2019.

Following Tempo, Cerberus enables cross-shard parallel processing, meaning that unrelated transactions don’t have to wait in a global queue to be processed. Multi-threading opens the door to linear scaling where throughput is limited only by the number and power of validators.

Cross-shard processing will be fully utilized by Radix’s Xi’an release in 2024. In the meantime, Web3 is waking up to Cerberus.

5. Atomic Composability

Atomic composability is the ability for multiple operations to be batched and executed as a single transaction. It is essential for DeFi and one of Radix’s core concepts.

While L2 solutions like Zero-Knowledge (ZK) rollups are prime candidates to 10-100x the throughput and security of Ethereum, their sequencing time and trust boundaries impede the ability to atomically compose transactions. In contrast, Radix operates within a single trust boundary and on the release of Xi’an will atomically ‘braid’ substates across shards, easily exceeding the throughput of rollups, without their limitations.

6. Sharding / Linear Scaling

Now for a 2^256x moment.

In its 2024 Xi’an release, Radix will upgrade its state model to 2^256 shards. Compared to the single-chain or dynamic sharding solutions of other L1s, pre-sharding delivers several significant benefits:

The main benefit of sharding on Radix can be summarized as linear scalability; making transaction capacity a function of validator count.

A second order effect is that miniscule shards allow anyone to participate in validation, which is at least a 10x for decentralization, with positive implications for network security and wealth distribution.

7. Low Fees

It is hard to overstate the importance of low transaction fees to a healthy market economy. By penalizing transactions, high fees prevent accurate price discovery, leading to poor decisions and the misallocation of resources - a kind of economic dementia. Contrarily, intelligence is the ability to error-correct - the lower transaction fees are, the more accurately prices can signal the true cost of production / demand, and the more ‘intelligent’ an economy is.

Fees on Radix are currently ~500x less than Ethereum and likely to decrease further after Xi’an when the current validator cap is lifted.

8. Delegated Proof of Stake

Switching from Proof of Work (PoW) to Proof of Stake (PoS) made Ethereum 100x more energy efficient, 100x more economically efficient and 5x more secure. However, validators must stake a minimum of 32 $ETH (~$53k) to benefit from staking rewards. Third-party staking is available for less but comes with smart contract and slashing risks. Radix has a minimum stake of 90 $XRD (~$4) to deter spam but otherwise allows anyone to stake their funds to a validator to earn staking rewards. This system is known as Delegated Proof of Stake (dPoS) and is a 10x for network participation and distribution.

9. Burn the Bridges!

Prior to Radix, no protocol has had the capacity to unite Web3 as TCP/IP united Web1. High demand on Ethereum block space led to high fees, which drove users and liquidity providers to deploy their capital to newer L1s, sidechains, rollups and other L2 scaling solutions. Because of the trust boundaries of blockchains and other digital ledgers, bridging to these alternatives usually requires assets to be locked in a smart contract on the original chain and newly minted on the other. This has had several deleterious effects on the growth of Web3:

1. Bridging is poor UX, costing time and fees.
2. Spreading capital across separate ledgers fractures liquidity, leading to higher interest rates, higher spreads and lower velocity.
3. Bridges are vulnerable, accounting for ~50% of all DeFi exploits since September 2020.

Being fast, linearly scalable and atomically composable, Radix eliminates the reasons for bridges entirely.

10. Simplicity

By attempting to build a global financial system on a slow, single-threaded chain without native assets, Ethereum is having to resort to Byzantine solutions like Proto-Danksharding to scale. Throw in competing ZK circuits and cross-chain bridges and eventually complexity itself becomes a drag on growth: every increase means fewer engineers, charging higher wages for sub-optimal solutions. If the complexity were a byproduct of new functionality then it might be justified, but the current stack is still grappling with the basic provisions of data availability and - by breaking atomic composability - actually reducing functionality rather than increasing it.

History in the Making

By the 16th century, despite issuing the World’s reserve currency, Florence grew insular and began to stagnate. Instead of adapting to competition from other states, the Grand Duke fixed the gold price. Unproductive Cain killed productive Abel and, true to form, commerce moved elsewhere.

History shows that economic growth is not difficult, it just requires a commitment to reduce friction enough to entice capital away from its sunk costs and into a new ecosystem. With that, the virtuous relationship between liquidity and growth is fairly linear, shown by a $1m trade on the ~$5tn forex market being ~50x cheaper than one on the ~$100bn stock market. Marketing campaigns might help at the margins, but, fundamentally, commerce is a marriage of convenience, not looks.

Characterized as a nation, Web3 is heir apparent: it has sound money, inviolable property rights, no defence expenditure, no immigration restrictions, and no national debt. All it lacks are lower operating costs - understood broadly as DX and UX - as well as transaction fees; in short, a ‘broadband moment’. On these measures, Radix has too many 10x’s to ignore, and is ready to make history.

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