When Bitcoin decided to attack the traditional centralised financial payment systems through the power of immutable and traceable decentralized and distributed cash transfer legacy blockchain, an economic war was declared.

And humanity innovates best in times of war.

Bitcoin itself is under attack from descendants of its blood.

Third generation blockchains are looking to address its inherent scaling problems while bridging the regulatory gap that bitcoin intentionally created to decentralize money.

And Usechain is arguably one of the best efforts at addressing this gap through the Mirror Identity Protocol.

In this article, we will explore the blockchain and see how different and better it is to the other efforts out there.

The blockchain evolution

Blockchain technology is barely a decade old, but its constituent technologies have been researched and documented since the late ‘70s.

Bitcoin was the first generation, and with Ethereum introducing Blockchain 2.0, the world was introduced to decentralized applications and smart contracts.

All the while, blockchain started with the idea of complete non-disclosure of transactional nature, especially to governments.

And then regulatory bodies started systematic crackdowns on ICOs, mining rigs and any other decentralized effort they could lay their hands on due to criminal activities like drugs and money laundering fears, and the unspoken quest for self-preservation.

Everyone agrees that blockchain technology provides an opportunity to do human-related activities like money transfer, reputation building and governance immutably, transparently and with full accountability.

But can blockchain shake of its weaknesses and accommodate regulation?

Its main problems have been low performance, token value volatility, escalating fees and wastefulness of computational power and electricity.

But the other real pain has been the blockchain’s de-linking of real identities with on-chain identities, which allows crime and other undesirable activities like cyber-attacks to be untraceable.

Understanding the Impossible Trinity

For the blockchain technology to be available to the masses, it must provide three main ingredients to solve the problem of centralization; Scale, Security and Decentralization.

Scaling

The bitcoin blockchain can only handle seven transactions per minute.

Ethereum is slightly better, at 25 tps.

Visa handles more than 10,000 tps.

The problem with these speeds is hard-coded into the Proof of Work protocols.

Each full node must compute the current state of the ledgers.

Hence, the blockchains are limited to the average speed of a single full node on their networks.

When this happens, transaction fees skyrocket and wait times are the order of the day, and this is the major put-off for every-day folks. They ask, "where are the instant and almost free services that the blockchain technology promised?"

Security

The original allure of the blockchain technology included a hitherto unseen financial possibility for anonymity.

When it became clear that anything you do on-chain cannot be traced to you as a person, drug barons, money launderers, Ponzi schemes and internet hackers started running rough-shod on society, including the same blockchains that protected their anonymity.

For example, Ethereum was forced to effect a costly hard fork to avert a massive Eth drain in the DAO Hack, and they lost a chunk of their community which continued mining the legacy blockchain under Ethereum Classic.

But most people want authentication before they can trade in assets. It is the old way of trusting, and the only way governments can include KYC and AML in blockchains and allow the technology to thrive.

Decentralization

If you are the kind of person who is already harping on and on about decentralization and how it is changing the way we do business and interact with each other, you are actually in a small crowd.

We have not been able to bring everyone on board. You should feel like Tim-Bernes Lee and his little band of researchers at CERN in the late 80s when they started the internet.

You must be wondering, 'when will my grandma use blockchain without worrying about wait times, transaction fees, hacking,etc.?'

The reason is that there are no widely adopted public blockchains. Banks, Social Media behemoths, Fiat Currencies, Insurance brokers and all manner of centralized enterprises still dominate how we do business.

Usechain’s Big Six

The central promise of anonymity is for users to be able to carry out transactions without being physically identified.

But based on the society's also significant concern on authentication of identity before value can change hands, Usechain proposes a Mirror Identity Protocol.

The first such effort in blockchain technology, the combined technologies that make this blockchain allows it to increase transactional power while boosting identity and security exponentially.

It has six unique features;

1. Multi-level authentication

A mapping relationship between the blockchain address and the physical identification will be used to accord the multi-level identity traceability and complete the authentication process seamlessly.

This will be achieved without disclosing the real identity of the owner of a user account.

2. Randomized Proof of Work

This consensus mechanism is fundamentally different from PoW as used in bitcoin and Ethereum.

It employs the use of Trusted Execution Environments (TEEs) to achieve anti-attack capability at a micro level and allow for ledger sharding, creating inter-nodal synergies to eliminate attacks.

This will allow the blockchain to achieve a high degree of scaling potential with high security and speed at low costs.

3. Identity and Transaction Sharding

Use chain combines the KaZaA P2P technology, Identity Network Sharding and Identity Transaction sharding to create a sharded chain on the base of user addresses.

Each address will belong to a sharded section, and each transaction’s confirmation will be completed in the trusted shard, eliminating the need for all nodes to compute the current state of the whole blockchain.

4. The IVM

The Identity Virtual Machine is a new standard that will allow the development of high-performance smart contracts and create a communication layer between the underlying blockchain and external data through bridges and APIs.

This will enable the blockchain to exponentially increase the scenarios on which dapps can be deployed to it.

5. Light Node Clients

Through higher level Merkle Trees, the blockchain will allow light nodes into the network as a result of reduced in-process data.

This will allow even mobile devices to run as full nodes.

6. Online Fault Tolerance

There will be a specialized board to check any transactions and addresses that occasion a conflict or fork in the network.

When a full node encounters such, the transaction or the address will be suspended and referred to the board as all other transactions go on unabated.

The overall experience

Used together, these technologies will assist the blockchain to achieve high levels of security and performance, but also allow public participation and mass adoption.

The blockchain will allow individuals, assets, things and objects to achieve identity mapping and carry out highly cost-effective and trusted transactions, instantly.

With the enabled identity tokenization, entities can use the resident UST token to purchase identity tokens and bypass money transfer fees.

The blockchain will also enhance trust-based interactions through reputation building, powered by the immutability of blockchain records.

Other scenarios will be enhanced and interest-free loans, insurance, games, decentralized exchanges and passive investment funds.

Final Thoughts

The blockchain is the technology of human interaction for the future.

The baby steps were done by Bitcoin, and the Ethereum ushered the smart contract era through Blockchain 2.0.
In Blockchain 3.0, the primary focus must change to enabling blockchains to scale, with high security and performance, while retaining the true spirit of decentralization.

Through the six features that allow the blockchain to effectively compartmentalize blockchain functions through sharding and the incorporation of the Mirror Identity Protocol, Usechain has entered the third generation with relish.

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