The Future of Public Chains: A Review of New Public Chains in 2022

Looking back at 2022, it is destined to be an extraordinary year. The cryptocurrency market is no exception, with the market trend in the cryptocurrency field continuing to decline. The recognition of the cryptocurrency winter and long-term bear market has become the consensus of 2022. However, in the primary market capital flow of this year, we can observe that the focus of investment institutions is on new public chains.

After entering the era of multi-chains, new public chains optimized based on Layer1 and Layer2 have emerged continuously. In 2022 alone, there have been nearly 30+ new public chains. Among these new public chains, there are many well-known institutions such as A16Z, Coinbase Ventures, and Binance Labs participating in the investment. During the last bull market, new public chains received a good increase in value by absorbing the overflow funds from Ethereum. However, the elimination rate in this track is extremely high. From the current market demand, concepts and applications such as DeFi, NFT, etc., have been rapidly developing, placing higher demands on public chains.

Therefore, these new public chains are constantly innovating and striving around the "impossible triangle" of "security, decentralization, and high performance," through different structural logics and application scenarios, to bring more possibilities to the public chain track.

Starting from the blockchain logical architecture, public chains can be divided into three layers: Layer 0, Layer 1, and Layer 2. Specifically:

Layer 0 corresponds to the "transport layer." This is where the Internet and hardware connect, allowing blockchains to interact with each other. For example, Polkadot and Cosmos have created cross-chain interoperable ecosystems at this layer. In addition, as it is at the most basic level, as long as they are built using the same Layer 0, developers do not need to start from scratch repeatedly, and many functions can be used at any time.

Layer 1 corresponds to the "data layer, network layer, consensus layer, incentive layer." This is where on-chain data processing, transactions, block dispute resolution, and other technical operations take place. Ethereum is the most famous Layer 1 public chain, but the most important problem faced by this layer of public chains is how to overcome the "impossible triangle dilemma."

Layer 2 corresponds to the "application layer, contract layer." This is a third-party integration used in combination with Layer 1, mainly to improve the scalability and throughput of the blockchain. Currently, Layer 2 technology solutions include three categories: State Channel, Rollups, and Plasma. Among them, the Rollups solution has gained favor in the Ethereum community, and it is divided into two types: Zero-knowledge Rollups and Optimistic Rollups.

The veDAO Research Institute has summarized and analyzed some public chain projects that received financing in 2022, most of which are Layer 1 public chains, in order to gain a clearer understanding of the characteristics and differences of these public chains.

Aptos

Aptos is a high-performance Layer 1 public chain created by former Meta engineers, using the Move programming language, focusing on security, scalability, and upgradability. At the end of January last year, Diem was sold by Meta, with some core members leaving and forming a team to develop the Aptos public chain based on the open-source code of Diem. Compared to existing public chains on the market, Aptos's biggest feature lies in the use of a new development language, Move, which was originally designed for the Diem project. Aptos achieves high TPS through Block-STM and allows new nodes to participate in state synchronization, emphasizing the security, scalability, and upgradability of the blockchain. Another feature of Aptos is that it does not force users to hold Aptos. If users do not have local currency, they can pay gas fees with other non-local currencies.

In March 2022, Aptos completed a $200 million financing round led by a16z, with other participating investors including Tiger Global, Katie Haun, Multicoin Capital, FTX Ventures, Coinbase Ventures, Binance Labs, PayPal Ventures, etc. In July 2022, Aptos completed a $150 million financing round, with FTX Ventures and Jump Crypto leading the round, and other investors including Griffin Gaming Partners, Franklin Templeton, Circle Ventures, and Superscrypt.

Sui

A Layer 1 public chain built by Mysten Labs, founded by former Meta engineers, using the Move programming language, with a PoS consensus mechanism, focusing on high TPS and low latency, mainly to enhance the composability of applications in the metaverse, including games, social, and commercial applications, and to build dynamic NFTs.

It raised $36 million in Series A financing, with major investors including a16z, NFX, Scribble Ventures, Redpoint, Lightspeed, Electric Capital, Samsung NEXT, Slow Ventures, Standard Crypto, Coinbase Ventures. The Series B round was led by FTX Ventures, with an expected total fundraising of $236 million.

Linera

A Layer 1 blockchain founded by former Meta engineers and former Zcash researchers, aiming for low latency and linear scalability. In addition to employees who participated in Diem and Novi at Meta, the team also includes former Zcash employees. Unlike the previous two projects, the information publicly available about the Linera project does not explicitly mention the use of Move, only that it uses a language based on Rust for development.

On June 29, Linera completed a $6 million seed round of financing led by a16z, with participation from Cygni Capital, Kima Ventures, and Tribe Capital.

Aleo

The Aleo team initially proposed the Zexe scheme in 2018 and published a paper, intending to fill the market gap in privacy and programmability in a new way. Zexe, short for zero-knowledge execution, allows transactions to be verified by anyone in a very short time without revealing the details of the computation, supporting many applications to run simultaneously and handling large-scale applications. This improves the scalability and privacy of the blockchain. In addition, Aleo has created its own programming language, Leo, which makes it easier for developers to build decentralized and privacy-preserving applications.

The early Series A financing was led by Andreessen Horowitz (a16z). Aleo then raised $70 million in a B+ round led by SoftBank Vision Fund and Kora Capital, following an oversubscribed $200 million Series B round led by Kora Capital and Softbank Vision Fund 2.

Portalverse

PortalVerse, as the computing infrastructure for the Metaverse, aims to build a distributed edge cloud rendering network through pioneering decentralized streaming cloud rendering verification consensus protocol (PoSR), in collaboration with GPU miners, 3A game content providers, and player communities, allowing anyone to enter a truly immersive virtual world anytime, anywhere.

Portalverse Network completed a seed round of financing worth millions of dollars, with participation from Big Brain Holdings, Cogitent Ventures, Octopus Venture Dao, 2Moon Capital, and individual angel investors.

AltLayer

An Ethereum scaling startup founded by Yaoqi Jia, who previously co-founded the Zilliqa blockchain and served as its CTO. It provides application-specific chains, customized blockchains for individual applications. Instead of building on blockchains like Ethereum, application developers build their own blockchains from scratch through platforms like AltLayer.

AltLayer completed a $7.2 million seed round of financing through SAFT sales, with Polychain Capital, Jump Crypto, and Breyer Capital jointly leading the round, and participation from Ethereum co-founder Gavin Wood, Balaji Srinivasan, former CTO of Coinbase, co-founder of Circle Sean Neville, co-founder of Synthetix and Bodhi Ventures Kain Warwick, and Jordan Momtazi.

Espresso Systems

Espresso aims to optimize the privacy and scalability of public chains through zero-knowledge proof technology. It is a Layer 1 blockchain that combines proof of stake (PoS) consensus and ZK-Rollup mechanism. In addition, Espresso has developed the Configurable Asset Privacy (CAPE) application for Ethereum, a privacy application that can run on any EVM blockchain, allowing asset creators to provide custom privacy guarantees to users.

Espresso Systems raised $32 million, with Greylock Partners and Electric Capital leading the round, and participation from Sequoia Capital, Blockchain Capital, and Slow Ventures.

Evmos

Evmos is a Layer 1 general-purpose public chain using cosmos underlying technology (Tendermint Core) and compatible with Ethereum smart contracts. Evmos can integrate Ethereum and other EVM-compatible chains into Cosmos, meaning chains like Fantom, Avalanche, and Harmony can integrate assets into the Cosmos ecosystem. EVM-based decentralized applications, tokens, and NFTs can be bridged to the Cosmos ecosystem through Evmos.

Evmos will also support IBC chains to access protocol types seen on Ethereum, including but not limited to decentralized exchanges, lending protocols, NFT applications, and more.

Kujira

A new Layer 1 public chain in the Cosmos ecosystem, dedicated to building a balanced decentralized financial competition environment for ordinary crypto users to develop DApps from 17 blockchains across Cosmos.

Celestia

A modular Layer 1 blockchain network supporting scalable and secure Web3 applications, with a CEO who holds a Ph.D. in blockchain scalability from University College London and is a co-founder of Chainspace, which was acquired by Facebook.

Celestia completed a $1.5 million seed round of financing, with participation from Interchain Foundation, Binance Labs, Maven 11 Capital, KR1, and others.

Polygon Avail

Polygon Avail records blockchain transactions and proves data availability. It focuses on data availability and ordering, representing a key component of Polygon's modular chain design vision.

Sei Network

Built using Cosmos SDK and Tendermint, with a built-in central limit order book (CLOB) module for Layer 1 blockchain.

Metabit

Metabit integrates decentralized algorithms, smart contracts, DeFi, NFT, and other blockchain technologies, targeting high-performance commercial application public chains for metaverse scenarios, aiming to build the underlying operating system for the future metaverse and provide a standard business ecosystem foundation for future metaverse applications, becoming a high-performance Web3.0 public chain, supporting decentralized finance, social, e-commerce, search, storage, and metaverse applications.

Metabit completed a $2 million seed round of financing, with Golden Bridge Capital and Eagle Capital leading the round, and participation from MCA, DG Capital, Tiger Venture.

Rubix

Rubix is a Layer 1 blockchain protocol for peer-to-peer data transmission and transactions, built by the Blockchain Association of Singapore (BAS), and recently announced a $100 million investment from LDA Capital.

Klaytn

Klaytn is a public chain developed by GroundX, a subsidiary of the large Korean communication company Kaokao, in June 2019. It is a service-centric enterprise-level distributed trust blockchain platform, providing a seamless user experience and development environment. It completed a $90 million ICO financing in March 2019, and its token diluted market value is currently about $10 billion.

Klaytn is backed by Kakao and has strong resources and inherent development advantages. Klaytn was initially positioned as an enterprise-level, service-centric platform, combining the characteristics of a public chain (decentralized data and distributed governance) and a private chain (low latency and high scalability) through "hybrid" design. Klaytn has also signed a central bank digital currency (CBDC) project with Korean banks.

Klaytn has now entered the Klaytn 2.0 era, targeting everyone from enterprises, positioning itself as a "metaverse blockchain." Its ecosystem projects are gradually focusing on AAA-grade games, P2E games, NFT, and DeFi services that support metaverse businesses.

Conclusion

Aptos, Sui, and Linera are often discussed together because the co-founders of these three projects are all from Meta and have worked at Diem and Novi. Diem was originally a stablecoin project of Facebook, which started in 2019 as a digital currency project for payment transactions, but due to regulatory reasons, it transitioned to stablecoins and was renamed Diem. It has not been well launched and was sold by Meta for nearly $200 million in January this year. Novi is another project of Meta, a digital wallet, also a pilot project, like Diem, it did not develop well. Most of the members of Diem and Novi projects chose to start their own businesses, leading to the emergence of these three public chains, Aptos, Sui, and Linera. These three public chain projects are also known as the "Meta series public chains" because of the co-founders, software engineers, and researchers who have worked at Diem or Novi. These three public chain projects are all aimed at solving the impossible triangle. Aptos and Sui both use Move as the programming language, which, compared to Solidity, sacrifices some flexibility but brings a considerable improvement in security. Both use Byzantine consensus or improved Byzantine consensus. However, using Move also brings a problem. The Ethereum ecosystem is strong, and the vast majority of dapps choose to develop using Solidity. Most public chains also want to use EVM compatibility to capture the value overflow from Ethereum. Whether developers are willing to rewrite programs using a new language is a question.

Looking at the development of the three projects, Aptos has the most momentum due to its early start and testnet incentives, followed by Sui, and Linera, due to its late start, has not received much attention, but the future development of these two projects may not necessarily be weaker than Aptos. In terms of investors, there is a very high overlap with Solana's investors, which is not a good thing.

In addition, Aleo, based on zero-knowledge proof, is also worth paying attention to. One of the biggest challenges facing blockchain protocols is the trade-off between privacy and programmability. In the entire privacy network, the most important thing is to shield identities and transactions. Aleo meets the demand for programmable privacy through the zkCloud system: zkCloud uses a peer-to-peer, decentralized privacy computing model, in which shielded identities can interact directly (such as asset transfers) or programmatically (through smart contracts).

In the context of coexistence of multiple chains, the differentiated competition of new public chains is becoming more apparent. Looking at these public chain projects, those that have performed well at the beginning of 2022 have several characteristics:

• Old projects with sufficient technical accumulation;
• NFT, which is highly disruptive, public chains that prioritize meeting NFT application scenarios will have enough heat;
• Vertical application scenarios, whether backed by large platforms for multidimensional, all-round coverage, or anchored in a specific segment application in the Web3 ecosystem, the above public chains are making efforts from this perspective.

Currently, various public chains are still in the exploration stage, and the public chain track is still waiting for the true arrival of Web3. Although it will take time for the cryptocurrency field to emerge from the severe winter, public chains are actively sowing, waiting quietly for spring.

🔴The above content is for reference only and is not investment advice. Please invest cautiously🔴

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