ICO Analysis: Nervos

Among blockchain thinkers and scholars, it is quite established that it is not possible to increase security, decentralization, or performance without sacrificing one (or both) of the others. On the other hand, some huge improvements of these properties are needed for mainstream adoption as the biggest blockchains such as Bitcoin and Ethereum have quite low transaction speeds, high transaction fees, and other issues. Nervos is a blockchain project that is aiming to solve these problems by introducing a layered design on a chain called Nervos Common Knowledge Base.

Architecture and Design

Appealing to a layered structure is not something completely new among blockchain projects. What truly differs Nervos from the herd is Nervos CKB itself. The chain is formed by five different components:

  1. Cells: Cells are the smallest storage units in the chain. They cannot be changed, as the Nervos chain is immutable, but can be updated by the same owner of the cells creating new cells, which invalidates the old cells.
  2. Types: Types consist of data schema, cells’ data structures, validators, and cells’ validating rules. Each cell has a determinate type.
  3. Validators
  4. Generators: Generators create new cells for types and run on the client side.
  5. Identity: Identity in CKB determines the owner of a cell and allows him or her to update a cell belonging to him or her.

Nervos CKB, with these five components, forms the foundational layer of the Nervos network. It deals with what states are created within the network, but not how they are. The second layer, called Generation Layer, is used for data generation as the name implies. With this layered architecture, data and computation can use different consensus mechanisms and this makes more flexibility and scalability possible.

One of the biggest differences Nervos has is that transactions store new states, not events which usually the state machine deals with. Thanks to this, the blockchain directly stores states and blocks and no further synchronization protocol is required.

In Nervos CKB nodes of three different types work together to form a P2P network:

  • Archive Nodes: Archive Nodes takes the role of full nodes in Nervos CKB chain as they validate and relay new blocks and transactions and store the whole transaction history.
  • Consensus Nodes: Consensus Nodes take new transactions, compress them into blocks and obtain consensus on these new blocks.
  • Light Clients: Users store very small amounts of data and can run the client on desktop computers or even on mobile devices.

Token

The Nervos native tokens are used to create and store states on the chain, ensuring consensus. These created states shall be validated by full nodes, thus presumably full node runners will be rewarded by these tokens. Updating cell data and transferring their ownership costs tokens as well.

Details on Nervos’ token distribution or how the team is planning to use the token sale proceeds are not made public yet.

As for the token sale, interested investors can submit their interest in contributing via Nervos’ interest form.

Team

The team has nineteen members and the most notable ones are as follows.

Chief Architect & Co-Founder Jan Xie: Xie has worked as a researcher and developer at the Ethereum Foundation and as an architect and full-stack developer at Yunbi, a Chinese cryptocurrency exchange.

CEO & Co-Founder Terry Tai: Tai is a former core developer at Yunbi.

Co-Founder Daniel Lv: Lv, the former CEO at Yunbi, is a co-founder and the former CTO at imToken, a popular Ethereum mobile wallet.

Co-founder Kevin Wang: Wang has worked as a software engineer at IBM for 9.5 years.

Advisors

Edith Yeung: Yeung is a partner at 500 Startups and a founding partner at RightVentures. She also held several positions at Dolphin Browser, a popular mobile browser.

Chris McCann: McCann works for GreyLock Partners, a US-based venture capital firm founded in 1965.

Partners

Nervos has a partnership with Cryptape, a China-based blockchain company. Many team members also hold positions in Cryptape.

Investors

Twenty-eight VC firms, including but not restricted to Blockchain Capital, FBG Capital and Polychain Capital, have funded Nervos.

Verdict

Below is a breakdown of the risks and growth potential of Nervos.

Risks

  • Low community interest and no considerable hype at the moment. (-2)
  • No details on the crowdsale or token metrics are made public yet. (-1)

Growth Potential

  • There are not many blockchains with multi layer structures. (+2)
  • Backed by many important venture capital firms. (+2)
  • Team members have prior experience in blockchain development. (+3)

Disposition

Nervos’ CKB and double-layered architecture are quite promising and the team is capable of developing such a beast. But the project seems to lack hype and community interest at the moment and poor or no marketing in the future might be troubling. Nervos receives a 4/10.

Investment Details

  • Type: Native – Utility
  • Symbol: Unspecified
  • Platform: Native
  • Crowdsale: Unspecified
  • Minimum Investment: Unspecified
  • Price: Unspecified
  • Hard Cap: Unspecified
  • Payments Accepted: Unspecified
  • Restricted from Participating: Unspecified

For More Information

Featured image courtesy of Shutterstock.

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