What is Harmony?

What Is Harmony? Check out our primer on the exciting chain, just in time for their Ethereum bridge.

Covered:

What Is Harmony?
Who Created Harmony?
How it Works?
What Is One?
Concerns

What is Harmony?

Harmony is a blockchain-based sharding protocol designed to enable lightning-fast transactions and interoperability. It is a project that offers cross-chain bridges for asset transfers within Ethereum, Binance, and others. It’s designed as an advanced layer-2 solution for Ethereum.

Harmony makes it easy and convenient for developers to create and scale decentralized apps (DApps) and enables them to have frictionless, cross-chain token swaps. The high-speed protocol is hosted on the Ethereum network and aims to provide a solution to the limitations faced by the network. The project’s grand vision is to build a self-sustainable environment in which users can create markets for fungible and non-fungible tokens (NFTs), benefiting from the interoperability and scalability that the platform provides.

Harmony also has one of the fastest block generation times in all the industry, as it takes no more than one second to generate a new block. The protocol’s fast block times allow for virtually instantaneous transactions, solving the slow transaction speeds plaguing Ethereum.

Who Created Harmony?

Dr. Stephen Tse is a man who probably needs no introduction to the crypto-savvy population. Dr. Tse founded Harmony. He is one of the core developers of Google Maps, and he sold one of his start-ups to Apple for a seven-figure sum. He later went on to work for Apple as well before quitting in 2015 to pursue his passion for blockchain technology. Dr. Tse has also developed his own programming language called ‘Min’ that is used to create blockchains.

Dr. Tse formed a team of blockchain developers and professionals, and in 2018, founded Harmony. Of the 12 initial members of his team, 7 of them had previously held positions at Google, Apple, Amazon, and Microsoft. About $20 million were raised by the project in fundraising, this included investments from private investors and Binance Lab. The native token of the platform, ONE coin was launched through a Binance Initial Exchange Offering (IEO), in May 2019. The very next month, the Harmony mainnet went live.

How It Works?

Harmony is one of those networks that is specifically designed to solve the blockchain trilemma of security, scalability, and decentralization. Besides these three aspects, another dimension, privacy, is integrated into the making of Harmony. Dr. Tse refers to it as the fourth trilemma.

Recommended: Here Are The Details On The Upcoming Harmony Ethereum Bridge

In terms of decentralization, Harmony isn’t entirely decentralized yet, but it remains a key goal to attain complete decentralization. The aim is to create a decentralized, open network community of nodes which shall be named Pangaea. Currently, the network has in excess of 1000 nodes, and almost 64% of them are from the community.

The plan for the future is that as popularity of Harmony grows, so will the number of nodes. This will exponentially increase the decentralization of the platform. There is also the plan of Pangaea being the main governing body of the platform. The Pangaea community will have the voting rights to determine the future course of the project. The community currently consists of members from over 100 countries.

Influences

In terms of architecture, the design of the Harmony blockchain is deeply influenced by both Ethereum and Cardano. It is a sharded blockchain, and currently, it is divided into four shards. These include the beacon shard, and shards one, two, and three. Each of these shards can support up to 250 validators. Harmony was the first successful launch of a sharded proof-of-stake blockchain. Other projects have tried tirelessly to create a solution for the task of interoperability between shards.

Recommended: How To Use The Polygon Bridge To Save On Gas Fees

Harmony presented its solution, by maintaining the same blockchain state throughout multiple shards. This allows the transactions between different shards to be as quick and as cheap as same-shard transactions.

The consensus algorithm used in Harmony is known as Effective Proof-of-Stake (EPoS). It is a unique consensus mechanism that incorporates the Practical Byzantine Fault Tolerance (PBFT) innovations to create the Fast BFT (FBFT). This allows the network to have almost instant finality and very low transaction fees. Currently, Harmony has a speed of almost 2000 transactions per second (TPS); however, the team claims that adding every new shard will add another 500 TPS. The aim is to have 2000 shards to achieve the speed of 1 million TPS across the network.

What is ONE?

ONE token is the native cryptocurrency of the platform. It powers the whole project, as it has numerous utilities. The name of the token, ie ‘ONE’ is a product of the vision behind the project which is, “For One and For All.”

Harmony aims to provide ‘open consensus’ to 10 billion people. ONE is available both as an ERC-20 token on the Ethereum network and as a BEP-2 token on the Binance Chain. Initially, it was intended to be an inflationary currency which means that it had no fixed limit, and more could be minted at any time. However, this changed in March 2020, as a fixed inflation rate of 441 million ONE token to be minted each year was imposed.

As Harmony is a Proof-of-Stake blockchain, the holders of the ONE token participate in securing the network, and thusly rewarded for doing so. The users can stake their ONE tokens and earn passive income through it.

The users who stake their tokens are known as validators. It is fairly easy to become a validator in this platform, as the minimum threshold is 10,000 ONE tokens to be staked. The validators get their rewards based upon the quantity of ONE token they have staked. There is also a plan for the ONE token to become the governance token of the platform in the future. This will allow holders of the token to vote on proposals pertaining to the future development of the protocol.

Concerns

The primary concern with Harmony is the level of competition that it has to face. Many projects are trying to solve the blockchain trilemma effectively, and some of them have shown themselves to be quite successful. Harmony faces stiff competition from the likes of Cardano, Polkadot, Solana, and Avalanche, etc. Furthermore, Ethereum 2.0, if successful, could spell the end for all of these upstart projects.

Another problem that Harmony faces is its comparatively low adoption rates till now. Its competitors, such as Cardano, and Solana, have seen high adoption rates as more and more developers flood to those platforms to create their DApps.