Perspectives | MOV-Cracking the Impossible Triangle of Trading

200317_MOV Cracking the Unwillingness Triangle of Transaction_Babit

Author: eighty thousand Martian

1 Introduction

The Steem incident is still fermenting. As the exchange misappropriates user assets to vote, and thus controls the community, centralized trading faces an unprecedented crisis of trust. If EOS is controlled by the exchange and still holds half of the pipa, then this Steem incident It is nakedly controlled by capital, or a typical voting attack.

In fact, the centralized transaction is only data. This is only a simulated transaction, not a real transaction. The real token actually only exists in the exchange's wallet, and the transaction data seen on the transaction interface is only used as a record. The language of the blockchain expresses that there is only one node for accounting, not distributed accounting. This is obviously unsafe and untrustworthy. There is no moment more urgent than now that people need a safe, good experience and a good way to trade.

2. Problems with the transaction

1) Sacrifice safety to ensure efficiency and depth

Typical is centralized trading. The advantage is that various tokens can be traded with good depth and efficiency. There are tens of thousands of tps per second. After years of optimization and development, it is also relatively easy to use. The problem is that users are worried about the exchange running, being stolen, illegally misappropriating user assets, disconnecting network cables at critical moments, and even some people have initiated exchange withdrawals and advocated that people should withdraw coins from centralized exchanges into their wallets. Concerns and mistrust of exchange security, however, this is just a helpless move without a better choice.

2) Sacrifice efficiency to ensure safety and depth

Ede is the representative of this kind of transaction. The orders and transactions are all on the chain, so the degree of decentralization is better. However, there is no automatic matching mechanism in Germany. Users need to find the required transaction orders by themselves, and there is no incentive for matching, so that people do not have sufficient motivation to provide liquidity. Transactions are subject to the performance of the Ethereum network. Each time a transaction is completed, it will take some time to know if it is successful. Therefore, the security of this model is guaranteed to a certain degree, but the efficiency is relatively low and the depth is not good enough.

3) Sacrifice depth to ensure safety and low efficiency

The typical representative of this model is 0x, which is essentially a decentralized transaction protocol based on Ethereum, allowing currencies that conform to the ERC20 standard to be traded on it. The problem with 0x is that if all are on the chain, the security is great. However, due to the need for broadcasts across the entire network, each of them is deeply fragmented, resulting in poor depth. If the order is off-chain, the efficiency is better, but it is not decentralized enough to ensure security.

In addition, bancor's fund pool model has the problem of too large administrator rights. If the administrators conspire, the fund pool will be in danger and cannot be completely decentralized.

3. Impossible triangle of transactions

Summarizing the above several trading schemes, it will be found that there is also an impossible triangle in terms of transactions, that is, most schemes have a trade-off between security, depth, and efficiency.

Or sacrificing security to ensure efficiency and depth, such as centralized transactions.

Or sacrificing efficiency to ensure safety and depth, such as Germany and Germany.

Or sacrifice depth to ensure safety and low efficiency, such as 0x, Bancor.

Although the decentralized transaction is a real token, why it has not been applied. In the final analysis, it is derived from the impossible triangle of the blockchain: decentralization, security and scalability, which is a comparison with the original one-master multi-sided architecture. Good solutions provide the basis for cracking the impossible triangle of transactions.

4.MOV security

MOV is a full-type transaction protocol, which can not only trade BTC, but also ETH, EOS format tokens, which means that most of the tokens on the market can be traded in MOV.

Different from the use of contracts for decentralized transactions, a single multi-side solution is used to solve the impossible triangle of the blockchain. A single side chain is used to implement decentralized transactions, which means that MOV is not essentially a Smart contract, but an agreement.

We know that system security is like wooden barrel theory. Even if one link is unsafe, the entire system is unsafe. The security of MOV mainly comes from the following aspects:

1) Security provided by the main chain POW

The main chain is responsible for issuing and destroying assets, and the side chain is responsible for running large-scale commercial applications. The side chain can use different consensus mechanisms to greatly improve the performance and flexibility of the side chain. At the same time, there can be an unlimited number of side chains to meet different fields. The POW proof-of-work mechanism adopted by the main chain is undoubted. The security of this consensus mechanism has proven its effectiveness on the Bitcoin network.

2) Sidechains deprive the governance rights of consensus nodes

The MOV side chain uses the DPOS entrusted equity mechanism. We know that the DPOS consensus mechanism has extremely high efficiency and its work. The network of this mechanism is easily controlled by the consortium due to the conspiracy of the consensus nodes. From the Steem incident, the consortium holds currency through the exchange Human voting rights attack other consensus nodes to achieve the purpose of controlling the community. It can be seen that the weakness of the DPoS mechanism lies in the excessive concentration of its governance power.

But we can also see that no matter how the community scrambles, the data has not been tampered with. This is mainly due to the mortgage mechanism. No matter how the community fights, the contention is for control, not for destroying the project.

MOV strips the governance rights of consensus nodes in the side chain, and only uses the efficient matching right of the DPOS consensus mechanism, and uses the revenue of the matching node's basic income plus the matching income to encourage competition for matching rights. In the transaction scenario, The "unfavorable" of the seizure of power is converted into "favorable", so the side chain of MOV has better security than the traditional public chain using DPOS mechanism.

3) BUTXO independence between main and side chains

The main chain asset adopts the BUTXO model. Each BUTXO is locked by a separate contract or a multi-signature mechanism. When cracking, only the assets locked by the contract can be obtained, and other assets are not affected, thereby protecting the security of the main chain assets. The side chain can verify the information of Header and Merkle Tree on the main chain block. The main chain does not need to care about the running status of the side chain. When the side chain is attacked, the security of the main chain is not affected. When the side chain is attacked, the main chain can be quickly withdrawn.

4) Open Federal Node Gateway

Between cross-chains, the use of open federated node gateways is an extremely important part of ensuring the security of the entire system. Only by ensuring the security of this link can people dare to transfer mainstream assets such as Bitcoin into the MOV ecosystem. The advantage of this gateway mechanism is that it is highly practical and can theoretically span blockchains with different mechanisms.

On the one hand, the multi-signature and small-scale threshold signature mechanism is used to allow the alliance gateway nodes to manage different private keys and private key shares to ensure the security of cross-chain assets. That is to say, an institution cannot transfer locked assets separately, and it must be agreed and agreed by other federal nodes. This requires the number of federal nodes, and at the same time, the federal nodes should check and balance each other due to their interests. Independence is the key to system security. MOV will introduce institutional participants such as wallets, security companies, mining pools, etc., which represent interests in different fields, to provide independence of its economic interests and positions.

On the other hand, the federal gateway will be kept open and free to enter and exit. As long as the institutions that meet the qualification requirements can participate, MOV will gradually open the mortgage and free competition of gateway alliance gateway nodes to form a co-governance and co-management alliance gateway ecosystem . With the expansion of the ecology, more and more federal nodes will join in, and the system security will therefore be more robust.

5) Random inspector supervision mechanism

This is also an extremely important part of MOV. In extreme cases, if the node is evil, the inspector mechanism will be its nightmare. Because all MOV transactions are on the chain, all transactions and pending orders are publicly visible. Each transaction data and record can be inquired on the chain, traceable, open and transparent, and cannot be tampered with. Users' transactions and cross-chains can be tracked on the chain, which facilitates the supervision of transactions. Inspectors will randomly lurk in the system and stand by at any time to catch cheaters. This is actually the government's regulatory interface. Just like the police in real society wear plain clothes, no one knows who is who. On the one hand, it has a deterrent effect on cheaters. On the other hand, you can monitor whether the transaction data is true, so as to achieve the supervision of the entire transaction process. It also lays a solid foundation for the supervision, tracking, and crackdown of illegal transactions such as money laundering by state agencies.

6) Check and balance of economic interests of multiple parties

Respect for the selfishness of people is the subtlety of MOV. The same behavior is subjectively selfish and objectively others.

MOV is not only a trading system, but also a trading ecology. MOV has multiple participants and allows each party to have economic income. The most important federal nodes are basic income, matching fees, and DeFi ecological dividends. Consensus matching nodes have matching fees and node dividends.

The coordination of the interests of all parties is the key to its success. In the system, the node benefits are designed to far exceed the costs, eliminating the original motivation of the federal nodes and matching consensus nodes.

5. Efficiency of MOV

We know that the DPOS consensus mechanism has sacrificed a certain degree of decentralization due to high TPS, but high TPS is not a requirement of the actual specific scenario, and sometimes it may be better to sacrifice efficiency for security. In other words, it does not apply its own advantages and disadvantages to specific scenarios.

For example, if you let a basketball star lift weights, its advantages will turn into disadvantages. It can be seen that in different scenarios, the advantages will also become disadvantages, and the disadvantages will also become advantages.

In a specific transaction scenario, under the premise of ensuring the security of the system, MOV has demonstrated excellent efficiency. Each 0.5s of the side chain generates blocks, and each block can accommodate 8,000 transactions, which is 16,000 tps per second. This efficiency has been The efficiency beyond credit cards can be comparable to a centralized exchange. If you increase the block and upgrade the node hardware, there is still room for further improvement. In addition, you can also use fragmentation technology to raise TPS to a higher level, reaching tens of thousands of TPS. The increase in efficiency increases the time cost of evil.

6.Depth of MOV

Thanks to the high efficiency of DPOS, it is possible to adopt on-chain order schemes. User orders in the MOV system are on the chain, open and transparent, and all participants can share orders, which enhances the depth of transactions. If a market maker team is introduced , Will further increase the transaction depth. The advantages of this method are: on the one hand, the data of the main transaction and retail investors are all open and transparent, and everyone sees their orders, which eliminates the problem of asymmetric information, improves the fairness of transactions, and reduces the weak position of retail investors to a certain extent. On the other hand, the transaction depth is good, and users can match the transaction with the fastest efficiency and the best price, which is almost the same experience as a centralized exchange.

7. Summary

Although centralized exchanges still have absolute advantages in terms of scale, there is no doubt that there is a real need for safer, better-experienced transactions. MOV decentralized trading protocols based on a main multi-sided architecture are undoubtedly flashing free, open, and transparent. A win-win blockchain. It has found a balance in security, efficiency, and depth, has an excellent trading experience, solved the impossible triangle problem of transactions, and brought dawn to the ecological prosperity of decentralized transactions.