What is Elrond?

Elrond is a popular choice among investors looking to trade altcoins. However, before you TradeEGLD, it is essential that you know what you are investing in. Let's find out what's Elrond and how it works.

Elrond is a favored option among investors looking to trade altcoins. However, before you Trade EGLD, it is vital that you understand what you are investing in. Let's find out what's EGLD and how it functions.

Elrond is an ambitious blockchain system that aims to provide lightning-fast transaction times via sharding. Fintech, distributed finance, and the Internet of Things are all components of what the project calls its technology ecosystem for the new internet. The project claims that its platform for executing smart contracts can handle 15,000 transactions per second with a six-second latency and a transaction cost of $0.001.

Community members and contributors who actively use the Elrond network get EGLD tokens as a symbol of appreciation. Electronic Gold (EGLD) is the currency used on Elrond. It is a medium of exchange that may be saved up and used to buy time on the network. The token is used as a means of exchange between the platform's users and validators. EGLD relies on transaction fees paid by users and validator services.

On EGLD, developers may create decentralized applications, smart contracts, and protocols. Participants are given the freedom to take any activity they choose within the network. The Elrond network is administered by EGLD, which is funded through transaction fees, staking incentives, and validation awards. Also, EGLD has the capabilities of a governance token, allowing its holders a voice in the direction the network takes.

How is Elrond different?

According to Elrond, they are a blockchain platform for the future internet economy, decentralized apps, and business use. It boasts of being the first blockchain network to include state, network, and transaction sharding, which is a key selling feature. Its white paper states that the company's overarching goal is to expand its ecosystem and legitimize EGLD as a commodity that can be used as a store of value.

To reach this aim, the network works on 2,169 validator nodes split into four shards: three execution shards, capable of 5,400 transactions per second each, and one coordinating shard, the Metachain. Elrond's adaptive state-sharding architecture entirely partitions state, transactions, and network. If the system's throughput requirements are not being fulfilled, it may be scaled by adding more shards. In open-source testing, 263,000 TPS has achieved over 1,500 nodes in 29 countries organized into 50 shards.

To further encourage widespread use,the project is offering 30% of all smart contract payments as royalty to developers who create new applications for the platform

During the first year of the network's existence, the firm reserved a supply of EGLD tokens for staking, with validator nodes earning a 36% annual percentage rate.The parallel processing approach is used to speed up the time and increase the number of transactions, as stated by the Elrond crypto team. The project supports three types of segmentation: state, transactions, and network.

Elrond is an all-encompassing piece of software that makes use of Adaptive State Sharding to increase scalability by pooling resources and supporting an increasing number of ledger-based apps and transactions. All sharded portions of the network remain connected to the platform using a modified version of the standard PoS operating protocol. Thus, the integrated environment contributes to creating dApps, which mimic existing goods and services.

The Elrond team used elements from three different sharding approaches to produce their own, highly flexible approach. The network is split into four pieces called shards. Three of these shards are execution shards,which handle the actual processing of transactions and can validate 5400 transactions per second. The fourth shard is Metachain, which handles transaction coordination and completion.

State sharding is one sort of sharding in which the network's state history is split up across many shards. Each segment maintains its own ledger at its associated node; Network sharding, in which the nodes are divided into segments and then processed; Transaction sharding, in which the transactions are mapped to segments and processed, segments process the transactions in parallel, and nodes capture the state of the whole network. One way in which network slicing helps improve connectivity is by isolating certain parts of a network.

How many EGLD tokens are there?

New EGLD tokens are issued to reward network validators, with the total supply starting at 20,000,000. The circulating supply of the token will drop as more transactions are processed.

19% of Elrond's original supply was sold in a private sale, with 7.5% accessible immediately upon token issuance and 15.41% issued every three months. Elrond also had an initial exchange offering on Binance, in which 25% was sold and made accessible instantly.

The remaining 56% was distributed as follows: 7% was set aside for ecosystem rewards, with 50% released instantly and 50% released after six months; 8.5% was set aside for marketing and an accelerator pool for DApp developers, with 81.17% released imnstantly and 9.41% every six months; 2% was set aside for a community fund, with 33.3% released immediately, 33.3% released after six months, and 33.3% released after 12 months; 2.5% was set aside for advisors, with 10% released after one year.

Elrond's tokens, known as ERD, were initially distributed on the Binance Chain and have a maximum quantity of 20 billion. On the Ethereum network, 500,000,000 were burnt in November 2019 and issued as ERC-20 tokens; in September 2020, the firm held a token exchange event during which token holders could trade in their ERC-20 and BEP-2 tokens for mainnet EGLD tokens. Due to the swap ratio being set at 1,000 ERD for 1 EGLD, the total quantity of tokens was lowered from 20 billion to 20 million.

Network Security

Nodes on Elrond's network must stake EGLD tokens in order to validate transactions, and the rating score given to each validator based on their prior behavior is taken into account when making selections. A validator will not be chosen and will be subject to penalties if its reputation drops below a certain threshold. If a validator consistently conducts actions that compromise the security of the network, they may be kicked off the network and have their stakes reduced.

There is no way to forecast or influence the selection of validators from one round of validations to the next. To further deter collusion, validators are frequently redistributed among shards. Strong cryptographic security is provided during inter-node communication by the use of modified Boneh-Lynn-Shacham multi-signatures (BLS).

Founders

Elrond was established by brothers Beniamin and Lucian Mincu and Lucian Todea towards the end of 2017 to address the issue of blockchain scalability.

Before starting Elrond, Beniamin and Lucian Mincu launched the digital asset investment company MetaChain Capital, where Beniamin served as CEO and Lucian as CTO. They also started an ICO data aggregator called ICO Market Data together.

In addition to being an early investor in companies like Zilliqa (ZIL), Tezos (XTZ), Brave, and Binance, Beniamin Mincu oversaw product, marketing, and community for the blockchain platform NEM in 2014 and 2015. Besides his work as a software developer, Lucian Mincu has also been an IT engineer and security expert for companies including Uhrenwerk 24, Cetto, and Liebl Systems.

Todea is a serial entrepreneur in the field of technology; he was the CEO of Soft32, a software download, and review website, and he is also a co-founder of the mobile payment service mobilPay. Additionally, he is an angel investor who has put money into the biometrics technology firm TypingDNA and the accounting platform SmartBill.

Where can you buy EGLD?

EGLD is available on the licensed cryptocurrency exchange CryptoForce and several other national and international exchanges.

Disclaimer: Cryptocurrencies are highly volatile and subject to market, technical, and regulatory risks. Crypto trading requires olne’s own diligence, and Cryptoforce will not be responsible for any losses incurred. Any information provided here should not be regarded as Cryptoforce’s technical or financial advice.