Why Wanchain is investing in FinNexus
Co-authored by Wanchain VP Lini and Technical Marketing Manager Noah Maizels
1) Development Isn’t Keeping Up With Changing Policy Landscape:
On the evening of October 25th, the central Chinese government released a favorable report on blockchain which once again thrust the technology into the mainstream spotlight:
“The Central Committee of the CPC conducted the 18th collective study on the current status and trends of blockchain technology development on the afternoon of October 24. They emphasize that the integration and application of blockchain technology will play an important role in new technological innovation and industrial transformation. They also stress that it is necessary to use blockchain as a core technology to allow for independent innovation breakthroughs, to clarify the main direction of development, increase investment, and focus on overcoming a number of key technological barriers and accelerating the development of blockchain technology and industrial innovation.”
With this one small piece of news, the whole industry was suddenly invigorated. That night the price of BTC rapidly surged to over 10k, the highest it has been in the recent weeks. At its core, blockchain is a decentralized ledger book. It is composed of cryptographically linked bundles of data, each of which contains information for multiple transactions and verification. Its characteristics make blockchain particularly suitable for applications in the field of finance.
Development falls behind policy
Since 2019, decentralized finance or DeFi as it is commonly known has become a hot topic. Proponents of DeFi are frequently heard promoting the revolutionary and disruptive benefits it will bring. However, when you take a closer look at some of the largest so-called ‘DeFi’ projects, you will find that the reality of them is far from their supporter’s dreams. There has yet to be any sort of wide spread adoption, and each of the major ‘DeFi’ projects such as MakerDAO, Compound, single chain DEXes and others, are all facing serious limitations in terms of usability, accessibility, convenience, and diversity of investment options. It is far from the dreams of universal access to quality financial applications for all which is the dream of Open Finance and DeFi supporters.
2) Development Bottlenecks:
There are both technical and commercial reasons why development is not keeping up with policy changes. From a technological point of view, blockchain has made great progress in the past 10 years, but there are still many significant challenges and flaws holding back application development.
Interoperability: While there have been several minor attempts at interoperability, there has been no truly comprehensive solutions for connecting the various public blockchains. In general, the major public blockchains are almost entirely unconnected with each other. There has been some minor progress made on the cross chain transfer of value, and even less on generalized cross chain data interoperability.
Consensus mechanisms: There is a general trend in a shift away from PoW (Proof of Work) consensus mechanisms such at that used by Bitcoin towards more energy efficient and faster PoS (Proof of Stake) mechanisms. While PoW may work for for one or a small handful of chains, by its nature, it cannot work for all the thousands of public chain networks around the world.
Usability: Even as there have been a number of technological breakthroughs, blockchain based financial applications still tend to be significantly less user friendly than their traditional counterparts. More work must be done to make them accessible for all.
How Wanchain is addressing these challenges
Wanchain is uniquely positioned as a global public blockchain to create a framework for heterogeneous cross-chain interoperability in order to connect the various blockchains of today’s largest mainstream digital assets.
Wanchain’s mainnet went live in January of 2018, and has currently reached its 3.0 stage of development with support for the cross chain transfer of a variety of assets including BTC, ETH, WAN, and a number of ERC20 tokens. Cross-chain support for EOS will be completed by the end of 2019.
In addition to its independently developed cross chain solution, Wanchain has also introduced an innovative Proof of Stake consensus mechanism which went live on the mainnet this year. Wanchain’s research and engineering teams are filled with the top minds of the industry.
The cross-chain mechanism technical paper was released in June 2017, and in 2018 the mechanism was used to integrate the worlds largest two public chains, Bitcoin and Ethereum, as well as a number of ERC20 tokens.
The cross-chain mechanism is built based on the principles of secure multi-party computation (sMPC) and threshold secret sharing. In order to manage cross-chain assets, groups of ‘Storeman’ nodes work together to manage the locking, unlocking, and transaction of assets across multiple chains based on the above mentioned technologies. The solution ensures the security and atomicity of cross-chain transactions without requiring any changes to the core mechanism of the crossed chains. It can be said the Wanchain’s cross-chain mechanism is the industry leader in terms of currently usable cross-chain solutions.
2. Consensus mechanism
The Wanchain research team released the PoS Galaxy Consensus paper in March, 2019, and officially launched on the mainnet in September. Galaxy Consensus is the world’s first practical PoS consensus protocol with a robust delegation mechanism based on Cardano’s Ouroboros consensus mechanism. The design introduces safer and more efficient random number generation and block selection algorithms, which greatly reduce the risk of natural forks, shortens consensus time, and guarantees the chain safety and propagation of chain data. Galaxy Consensus was included in the “China Blockchain Development Report (2019)” Blue Book and the China Computer Society Blockchain Technology Conference SCI Journal.
Wanchain’s light wallet updated as of October 2019 features convenient staking, delegation, mainnet, cross-chain and private transactions — packaged in an attractive, modern, and easy to use interface. Through private transactions, users may anonymously transfer assets to each other without it being visible to the public.
Having overcome these various bottlenecks, Wanchain is now fully capable of supporting a wide variety of open finance applications for a global audience.
3) The road forward to truly ‘open’ finance
All blockchain based financial application must adhere to the basic rules of business — to provide products or services that others need to make money. The majority of recently developed blockchain based projects lack sustainable business models, and have no clear road forward for establishing long term business. While many of these projects have lofty ideals and ambitious goals, many have done little to create anything of real value with the millions raised by their ICO. As a result, the perception of the entire blockchain community has slowly changed for the negative. It can be said that bad coins drive away good money.
The success of any public chain technological infrastructure project is closely tied to the success of applications built on the chain. As a public chain project, Wanchain’s focus on on providing infrastructure for interoperability and cross-chain transfer of value. In terms of commercial positioning, Wanchain maintains a clear focus on finance applications, with the vision to “rebuild finance”, as its guiding goal. Wanchain therefore places great emphasis on attracting high quality financial applications to its ecosystem. FinNexus is just such an application.
“As a multi-chain asset channel, FinNexus rejects the value anchoring of a single digital asset, and is committed to allowing users to enjoy a richer and more transparent portfolio by integrating native digital assets and traditional assets on the blockchain. Blockchain assets are criticized by some people as ‘valueless coins’, but FinNexus is different because of the traditional asset support behind it.
As a so called layer three protocol, FinNexus is a coordinator for layer 1 blockchain protocols and layer 2 scaling and storage protocols (such as RiveX, a layer 2 decentralized storage project built on Wanchain). Just as third-party payment providers help merchants and users more easily interact online, FinNexus’s financial application protocol makes it easier for users to access assets on the blockchain.” — FinNexus founder Yang Tao
If you want to use a more intuitive metaphor to describe FinNexus, it is a hypermarket for blockchain based assets. It gives users access to financial products combining various elements of blockchain and traditional finance, while providing users and investors with a one-stop convenient and secure financial channel. Therefore, whether as a protocol or as an application, FinNexus is exactly the type of application Wanchain needs.
Investing in people
There is a famous saying in the investment community:
You don’t actually invest in business, you invest in people
We understand the founding team is very important to the success of a project. The FinNexus team is full of talented and experienced individuals:
FinNexus CEO Yang Tao (Boris Yang) is a former key member of the Wanchain team, and one of the main designers of the white papers and the core vision driving Wanchain. Yang Tao is a professional with experience in both the blockchain and the traditional finance industries. Mr. Yang worked closely with Jack Lu from the early days of Wanchain, and worked hard to get the project to where it is today. After making sure Wanchain was in good hands, Mr. Yang later left to form his own project inside the Wanchain ecosystem with FinNexus.
Yang Tao (Boris Yang)
Ryan, the chief economist in the team, is an experienced designer of financial products. He has more than 10 years of experience in traditional investment banking and has extensive experience in traditional finance law, regulation, and financial product design.
FinNexus CTO Bob Chen is a senior technical expert from Cheetah Mobile, and is also a core developer of Cheetah Mobile Internet products and digital asset trading systems.
Dr. Bob Chen
The team also includes internet operations expert Maik Liu, financial regulation and asset management expert Jack Tung.
The entire team has a wide range of talent from various industries with backgrounds in blockchain, traditional finance and mobile internet, and financial regulation.
FinNexus is also joined by a number of impressive partner companies. In addition to Wanchain, professional guidance is being provided by the fintech company SuperAtom and Zhongguancun Dahe Capital Partners. With such an impressive team and list of partners, we are confident in our belief in FinNexus!
BKEX Capital partner Zhu Jiang’s evaluation of FinNexus:
“With the current lack of high quality digital assets today, whoever can offer good assets will be the leader in the future. As FinNexus will connect users with authentic and high quality assets, it’s clear that FinNexus’s innovative model will set a new benchmark for open finance.”
Author — Lini
Currently Vice President of Wanchain Global, core advisor for the FinNexus Project, Vice President of Beijing Wanglu Tech Co., Ltd., Deputy Secretary General of Blockchain New Financial Laboratory, Expert Committee Member of China Electronics Chamber of Commerce Blockchain Committee, 2018 China Blockchain 3.0 top 50 industry figures.
Mr. Lini also serves as an IT consultant at the Food and Agriculture Organization (FAO). He is the author of ‘Innovative Risk Management Strategies in Rural and Agriculture Finance’ (Food and Agriculture Organization of the United Nations Press).
Co-Author — Noah Maizels
Currently technical marketing manager at Wanchain, Noah is a bilingual (Chinese & English) marketing and communication professional with 7 years experience working in China. As a professional marketer and technology enthusiast, Noah has been actively following the blockchain scene since the early 2010s. His passion is making tough technical concepts easy for everyone to understand.
Wanchain is the infrastructure connecting the decentralized financial world. Wanchain’s live cross-blockchain solution is EVM-based, includes optional private transactions, and provides a decentralized, permissionless, and secure approach for interoperability. Wanchain has employees globally with teams in Beijing (China), Austin (USA), Kuala Lumpur (Malaysia), and Madrid (Spain).