High Speed, Low Cost: Real-World Applications on the Velas Blockchain

Since the 1990s, internet speeds have increased by about 19 million times—from 56 kbps to 10 Gbps—and dynamic web apps like Figma and Google Docs replaced static sites.

A similar trajectory is emerging in the blockchain industry: throughput of protocols keeps rising. What will the dapps of the future look like? We examine with the Velas developers — Velas is an EVM-compatible blockchain with a throughput of 50,000 TPS and a block time of 0.4 seconds.

Blockchain-based social networks

Social networks are among the most popular apps in the world. Facebook’s user base is almost 3 billion, Telegram — 700 million.

At the same time, messages, photos, logins and passwords are stored in centralized data centers without adequate protection. In 2021 alone, hackers stole the personal data of 533 million Facebook accounts.

Social-media owners periodically announce blockchain integration, but they limit themselves to economic experiments. For example, in August Reddit released an NFT collection, and the integration ended there. Although distributed networks could have enabled decentralized data storage and allowed earning revenue from renting disk space.

Yet blockchain-based social networks offer a number of other advantages:

• Ease of registration. Logging in with a wallet — no email verification, 2FA setup or other steps;
• Account security. Instead of a login and password — a private key. It cannot be guessed or recovered, but it can be stored on a hardware device;
• Message privacy. End-to-end encryption of messages using a private key — without it the data cannot be read, even on an open blockchain or IPFS;
• Enhanced user experience. Ready-made infrastructure for payments, tips, trading and NFT collection.

Similar projects already exist: Minds — a decentralized analogue of Facebook, Quilt — an anonymous chat with end-to-end encryption, Bitorbit — a social network for NFT artists and collectors.

Decentralized exchanges with instant order fulfillment

Centralized exchanges beat DEX on trading conditions — speed of execution and order prices — but lose on other parameters:

• Asset control — the trader deposits and entrusts their cryptocurrency to third parties;
• Anonymity — almost all centralized platforms require KYC;
• Regulation — exchanges do not allow registration for users from some countries and freeze accounts.

DEXes do not require registration or the provision of personal data, operate without deposits and cannot restrict access to smart contracts for individual users.

The main drawback of decentralized exchanges is slow order execution. It stems from the mechanism: a trade is completed only after inclusion of the block in the blockchain. Waiting time depends on the protocol and can reach 30 seconds.

Additionally, DEX use AMM and liquidity pools, so traders suffer from slippage: as the trade size increases, the average execution price deteriorates.

The first problem can be solved with fast blockchains, the rest by implementing an order book in a separate smart contract, as on 1inch.

Transaction finality speed on Velas is 1.2 seconds — WagyuSwap guarantees execution within this time.

There are no Velas order-book exchanges yet, but in theory it should work quickly and cheaply: the cost of storing 1 MB in the blockchain is $0.14, and the fees for calling a smart contract do not exceed $0.00001.

The Internet of Things as a separate economy

The Internet of Things (IoT) is a concept of a network for data transmission between different devices. A typical IoT example is a kettle that boils water when the owner’s smartphone connects to home WiFi.

Primarily IoT is associated with gadgets and automation in buildings. But in tandem with blockchain it can be used in business and manufacturing.

IBM solutions on the basis of a distributed ledger already help companies automate logistics, monitor the status of aircraft spare parts and log the operation of various devices.

Also IoT paired with blockchain is suitable for creating decentralized economic systems with micropayments. For example, for WiFi distribution by the second or 3D printing with pay-per-use materials.

Using tokens in business

Companies worldwide are launching loyalty programs: point-based cards, discount apps and gift certificates. And all of them can be replaced by a blockchain wallet and corporate tokens.

Possible use cases:

• staking tokens for access to discounts and special offers;
• NFT certificates instead of paper receipts;
• tokens for voting — on changes to product lines or opening new stores;
• trading and exchanging discount tokens among customers.

Transaction fees can hinder attracting people unfamiliar with cryptocurrency concepts, but this problem is easily solved by using a fast and affordable blockchain.

Companies will prepay hundreds of transactions in advance and hide from customers the calls to smart contracts, signing operations and other wallet-related work.

A second hurdle could be the need for additional investments and expertise.

Typically protocol teams are invested in growing their ecosystems: they advise startups and allocate funds for dapp development. For example, Velas has launched a grant program of $100 million for projects that bridge blockchain with traditional sectors of the economy.

Symbiosis of games and blockchain technologies

Developers have already adapted cryptocurrencies for in-game economies: Mir4 has resources in token form, Sorare released NFT football player cards, and projects like Velhalla popularised the Play-to-Earn mechanic.

Nevertheless, these games resemble DeFi tools with a polished UI. Here are several blockchain use cases that benefit gamers:

• store speedrun records in a smart contract — so they cannot be tampered with or erased;
• record player actions to train neural networks on them;
• store the order of the deck to prove fairness in card games;
• issue keys to games as NFT and use a blockchain wallet to access the gamer’s library;
• issue characters, highlight reels and achievements as NFTs.

Gaming mechanics are not the only things that can be improved. Velas is working on Velas Account platform, which will simplify authentication and interaction with apps. Among its features:

• Account registration in four seconds. Instead of entering a username and password, email verification and CAPTCHA, the user authenticates via session keys linked to the account;
• Transactions without confirmation. Most actions in blockchain games involve calls to smart contracts that must be confirmed manually. Velas Account enables automatic signing of operations, making blockchain games more dynamic;
• Permissions for apps. An app will be able to spend only a defined amount or perform actions within set limits. This helps prevent asset theft by malicious apps;

In addition, using Velas Account requires no additional apps or browser extensions. This makes blockchain games more approachable for users without experience interacting with cryptocurrencies.

Conclusion

The capabilities of any device are limited by its specifications: you cannot watch videos on a Nokia 3310, and on a slow blockchain — you cannot create a convenient and affordable-to-use app.

Perhaps in a few years we will be able to present NFT tickets at concerts and access Twitter through Velas Account or another blockchain platform. The onus is on the developers who want to make it happen.

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