If all goes well, $700 million worth of cryptocurrency is about to find a new home.
That’s because Shanghai-based Ontology, a project closely tied to the “smart economy” blockchain Neo, is expected to launch its live blockchain on June 30, a step that will find one of the top 20 crypto assets finally releasing its proprietary technology.
Described as an enterprise-focused platform, Ontology is seeking to provide a high volume of fast and cheap transactions, all while helping businesses grapple with the thorny problems of interoperability and digital identity. As such, Neo is one of several public blockchains catering to enterprise that have recently or will soon go live, Tron and Vechain being other notable contenders.
However, what might distinguish Ontology’s claims is the experience of the team.
The protocol emerged from Neo, an ethereum challenger whose founder, Da Hongfei, is Ontology’s CEO. Both Neo and Ontology are subsidiaries of Onchain, which developed a private enterprise blockchain platform called DNA. Da is also Onchain’s CEO.
Meanwhile, Ontology’s founder Li Jun told CoinDesk that his company and Neo are co-funding work on API standardization, shared smart contract standards, and “cross-chain technology innovation.”
Ontology’s corporate and technological genealogy might be difficult to keep track of, but the result is a pragmatic approach that appears to combine ambition with a lack of the ideological fussiness.
As Li said at a meetup in March:
“When you want blockchain to become a mainstream industry like the internet today, you have to link to the real business scenario.”
For a while, Li added, it seemed that appealing to businesses meant building a permissioned framework like DNA, but it soon became clear that “public blockchain is the future.”
If you already trust each other, he explained, “blockchain is not necessary.”
Having adopted that stance, Onchain – which has since received backing from the Chinese conglomerate Fosun Group and been accepted to Microsoft’s Shanghai accelerator – began work on a public platform that would meet some of businesses’ most pressing needs: anchoring digital identities in the real world, allowing for flexibility in terms of technical design, and preventing the creation of restrictive silos.
Two tokens, countless chains
Ontology has created a complex framework in its bid to satisfy all of these goals.
Similar to Neo (with NEO and GAS), the network will support two tokens. So far, only ONT exists. A token on the Neo blockchain, it was distributed to NEO holders in an airdrop, half of which has been completed (the other half is set to occur after the mainnet launch this week).
Barring unforeseen obstacles, these tokens will migrate to a proprietary blockchain on June 30. Once there, they will serve as a governance mechanism, with users staking ONT in order to make network decisions.
Holders of ONT tokens will also begin to receive newly created ONG tokens, which will serve a similar role to Neo’s GAS tokens, funding the execution of smart contracts. Each ONT will “release” ONG tokens for 18 years.
The more unusual aspect of Ontology’s design is that it consists of multiple interoperable chains, anchored by a core blockchain (in a way that’s perhaps not different from how ethereum envisions its “sharding” technology). According to those involved, his choice reflects Ontology’s enterprise focus and the desire to give businesses flexibility in terms of designing a ledger – without shunting them into a silo.
Daniel Assab, Ontology’s senior overseas market specialist, told CoinDesk:
“In this industry, there’s a lot of chains that want to cut up – cut their share in the ecosystem and try and take all of the competition in this area. But we want to cooperate with everyone, work with everyone, make this as compatible as possible.”
Speaking in March, Li noted that enterprise applications want to be able to customize. “They have a lot of requirements,” he said. “They want their own blockchain with their governance model.”
Ontology’s main chain will be based on a new consensus mechanism, VBFT – a combination of proof of stake, verifiable random function and Byzantine Fault Tolerance – which the team expects to be able to process over 3,000 transactions per second.
The network intends to be able to support multiple governance mechanisms, however, on its subsidiary chains.
People and things
Ontology has conceived this elaborate architecture in order to enable what its white paper calls a “decentralized trust ecosystem.”
“We want to integrate different trust sources,” Li said in March, and not just the scattered and self-referential digital aspects of trust – such as private keys – but real-world seats of trust: the legal system and physical assets such as real estate. As he told CoinDesk, “Ontology can serve as a bridge connecting the physical world and business.”
In other words, Ontology hopes to crack the problem of identity in the digital age, another goal being pursued by a number of blockchain projects. “
But Ontology doesn’t just want to help define digital identity for people, it wants to do this for digital items as well. To that end, it’s partnered with Chain of Things (COT), which founder Wang Wen described as a “universal basic platform for IoT [internet of things] and intelligent hardware” based on Ontology’s platform.
Ontology has also partnered with Contentos, a blockchain-based streaming video project.
Ontology’s team is working on a number of implementations to be launched over the coming months and years, including an ID framework and marketplace, a reputation system, a “trust search engine” and a data exchange protocol. As with any self-respecting blockchain protocol, though, it aims to attract app developers to build out its ecosystem.
Panther, the founder of a community development group, told CoinDesk they are working on a C# software development kit and a Chrome plugin wallet, in addition to other projects.
Getting the swap right
Whether Ontology can follow through on all – or any – of its ambitions is an open question. But first it has to complete its transition to mainnet without leaving too many of its token holders behind.
Many users will have to complete the swap manually, leading to concerns that “people could forget to do the token swap or … think, ‘it’s okay, I can hold,'” Assab said.
Users who hold their ONT on certain exchanges, including Binance and Huobi, may have their tokens swapped automatically, but Ontology social media admins said they should “refer to individual exchanges’ policies.”
For users who do the swap manually, Ontology has posted a frequently-asked-questions page.
A likely headache for some users will be making sure they don’t needlessly give up some of the ONT they’re theoretically entitled to. The Ontology mainnet will accept only round numbers of tokens and disregard fractions. Even though the airdrop was for a fraction of ONT per NEO.
Users will have until October to complete the swap, but Assab said:
“If that deadline needs to be changed, it will be changed.”
Construction image via Shutterstock