On Monday (July 1), Singapore-based Huobi Group, “a leading global digital asset financial service provider”, announced that it is partnering with Nervos Foundation (aka “Nervos Network”) to launch a public blockchain (“Huobi Finance Chain”) focused on modernizing the services of the financial industry for the “decentralized future.”
Nervos says that it is “a network of scalable and interoperable blockchains built on top of an open network,” the Common Knowledge Base (CKB), which “is built to store crypto-assets and to securely anchor Layer 2 protocols and blockchains.” It is important to note that rather than being a single blockchain, Nervos is “a network of interoperable protocols.” The Nervos CKB “provides only decentralization and security and is designed to be a verification platform (like Bitcoin), instead of a computation platform (like Ethereum).”
Decentralized applications (DApps) will “interact with the Nervos CKB through various Layer 2 protocols that utilize the Nervos CKB to ensure their trustless operation.”
Nervos balances the trade-offs of a decentralized system by using a layer approach. The Nervos CKB can be “a public chain that provides the broadest consensus and strongest security without sacrificing decentralization” since it leaves optimizing for “expressiveness, performance, finality and throughput” to Layer 2 protocols.
The Nervos CKB was open-sourced in December 2018, and a testnet was released in May 2019.
According to Huobi Group’s blog post, Huobi’s upcoming Huobi Finance Chain platform “allows enterprises, financial institutions, and exchanges to deploy their own blockchains, tokenized assets, and DeFi services.” Furthermore, this platform will have the potential to host lending services, debit services, stablecoins, security token offerings (STOs) and other means of asset issuance, decentralized exchanges (DEXs), real-world payment services, and more.”
This joint project “will provide multi-asset support and smart contract capabilities to enable third-party developers to build and deploy a wide range of DeFi services.” In addition, the platform “will also support multi and side chain architectures to provide a flexible and globally scalable blockchain infrastructure for financial institutions and enterprises.”
Interestingly, Huobi apprarently wants to make this platform address the concerns of financial regulators by supporting Decentralized Identifiers (DIDs) and implementing protocols such as Know Your Customer (KYC) in order to deal with Anti-Money Laundering (AML) requirements. Also, regulators will be able to join Huobi Finance Chain and “contribute to the network as validators.”
Livio Weng, chief executive of Huobi Global and vice president of Huobi Group, said:
We believe this project has enormous potential to do for established and emerging financial products and services what cryptocurrency is doing for the world of money. One of our core missions has always been bringing the power of blockchain to the public and we think something like this has the potential to benefit millions of people globally. We’re extremely excited to be working with the Nervos team on this.
As for Leon Li, the CEO and Founder of Huobi Group, he had this to say:
From a strategic point of view, decentralized financial services are still in an early stage of development. The market demand is clear, however, and we believe this is a very definite business opportunity.
According to this partnership agreement, Nervos will be providing the blockchain technology (described earlier) for this new platform. The two companies are aiming to launch the testnet in Q1 2020, with the launch of the mainet expected to take place in Q2 2020.
Kevin Wang, co-founder of Nervos Network, stated:
Our vision is to build the infrastructure for the future decentralized economy, so we’re thrilled to partner with Huobi to bring our technology to the financial sector. More and more assets are being tokenized and moved
to the digital world, including both native cryptocurrencies and traditional physical assets. The financial industry is now at an inflection point, and together with Huobi, we’re well positioned to help it modernize its services for the decentralized future.
Featured Image Courtesy of Huobi Group
