Technical dive into blockchain based protocols and decentralized applications, challenges, design principals and security risks. Will try to answer the question why next generation of protocols is just around the corner.

1. DECENTRALIZED
PROTOCOLS
AND
APPLICATIONS
P I OT R KO S I Ń S K I

2. Piotr Kosiński
@piotrkosinski
piotr@blockdiggers.com

3. PROTOCOL VS APPLICATION

4. PROTOCOL VS APPLICATION
Internet of information
Google, Facebook
HTTP, DNS, FTP
Internet of value
Jaxx
Bitcoin, Ethereum
V
a
l
u
e
c
a
p
thttp://www.usv.com/blog/fat-protocols

5. BLOCKCHAIN PROTOCOLS VALUE
𝑝𝑟𝑜𝑡𝑜𝑐𝑜𝑙 𝑣𝑎𝑙𝑢𝑒 = 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑐𝑟𝑦𝑝𝑡𝑜𝑐𝑢𝑟𝑟𝑒𝑛𝑐𝑦 ∗ 𝑣𝑒𝑙𝑜𝑐𝑖𝑡𝑦
𝑝𝑟𝑜𝑡𝑜𝑐𝑜𝑙 𝑣𝑎𝑙𝑢𝑒 = 𝑠𝑢𝑏𝑝𝑟𝑜𝑡𝑜𝑐𝑜𝑙 𝑣𝑎𝑙𝑢𝑒
𝑛𝑒𝑡𝑤𝑜𝑟𝑘 𝑣𝑎𝑙𝑢𝑒~ 𝑛2
https://medium.com/@primoz.kordez/the-economics-of-blockchain-protocols-18bca548e596

6. ETHEREUM
(SUB)PROTOCOLS
• Based on EVM (written in Solidity)
• Interoperable within Ethereum
• Fueled by tokens
• Open source

7. THINGS TO
CONCERN
• Cryptoeconomics
• Attacks
– Sybil attack
– Front running
• Immature technology
• Scalability
• Governance
• Cost of the transaction

8. ETHEREUM STACK

9. ETHEREUM DAPP ARCHITECTURE
Geth Ethereum Network
Parity
Web3
endpoint
Geth
DApp
Web3
client

10. ETHEREUM ALARM CLOCK
EACScheduler
Scheduler
Executor
Executor
Executor

11. ETHEREUM ALARM CLOCK
Naive implementation
𝑝𝑎𝑦𝑜𝑢𝑡 = 𝑟𝑒𝑤𝑎𝑟𝑑 − 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑒𝑥𝑒𝑐𝑢𝑡𝑜𝑟𝑠 − 1 ∗ 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑓𝑎𝑖𝑙𝑖𝑛𝑔 𝑡𝑥
𝑟𝑒𝑤𝑎𝑟𝑑 = 𝑛 ∗ 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑓𝑎𝑖𝑙𝑖𝑛𝑔 𝑡𝑥
𝑝𝑎𝑦𝑜𝑢𝑡 > 0
𝒏 > 𝒏𝒖𝒎𝒃𝒆𝒓 𝒐𝒇 𝒆𝒙𝒆𝒄𝒖𝒕𝒐𝒓𝒔 − 𝟏

12. ETHEREUM ALARM CLOCK
Claiming
𝑝𝑎𝑦𝑜𝑢𝑡 𝑐𝑙𝑎𝑖𝑚𝑎𝑛𝑡 (𝑡) = 𝑚𝑜𝑑𝑖𝑓𝑖𝑒𝑟(𝑡) ∗ 𝑟𝑒𝑤𝑎𝑟𝑑 − 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑒𝑥𝑒𝑐𝑢𝑡𝑜𝑟𝑠(𝑡) − 1 ∗ 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑓𝑎𝑖𝑙𝑖𝑛𝑔 𝑡𝑥
start
Claimwindow
Freezewindow
Exclusive execution
Execution window
𝑝𝑎𝑦𝑜𝑢𝑡 𝑡 = 𝑟𝑒𝑤𝑎𝑟𝑑 − 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑒𝑥𝑒𝑐𝑢𝑡𝑜𝑟𝑠 𝑡 − 1 ∗ 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑓𝑎𝑖𝑙𝑖𝑛𝑔 𝑡𝑥 + 𝑑𝑒𝑝𝑜𝑠𝑖𝑡

13. QUESTIONS ?