Casper

What is Casper (CSPR)?

Casper is a decentralized proof-of-stake (PoS) blockchain, billing itself as “the future-proof blockchain.”

Casper is open-source but optimized for enterprise and developer adoption thanks to its various unique features. These include upgradeable contracts, predictable network fees, privacy flexibility, on-chain governance, and developer-friendly languages.

One of Casper’s key design elements is rapid optimization for security, decentralization, and high throughput. This allows development teams to build on Casper with confidence in the network’s ability to evolve.

CSPR is the Casper network’s governance token, used as a medium of exchange on the network as well as for staking and fee payment.

When Was Casper Launched?

The Casper mainnet launched on the 30th of March, 2021. The Casper Network’s genesis block saw configuration files installed by 54 node operators.

The final testnet preceded the mainnet launch by several months, and the network’s Genesis Event saw developers receive several incentives. DEVxDAO was seeded with 500 million CSPR tokens, and a further 1.1 billion CSPR would go to developers over the next six years.

According to Casper’s documentation, CasperLabs, the company behind Casper, raised $14.5 million in Series A funding in September 2019. This round was led by Terren Piezer and saw participation from firms such as Consensus Capital and Axiom Holdings Group.

Who are the Founders of Casper?

Casper was founded by Medha Parlikar and Mrinal Manohar, who hold the positions of CTO and CEO at CasperLabs.

Parlikar is a SaaS specialist who has delivered solutions for Adobe, Omniture, and Avalara. Meanwhile, Manohar was an associate at Bain & Company and Bain Capital.

How Does Casper Work?

Casper is a Byzantine Fault Tolerant, proof-of-stake blockchain that uses a specific consensus mechanism called the Highway Protocol. The Highway Protocol takes BFT to the next level—as it allows the network to reach higher thresholds of finality—and achieves flexibility in an unusual way.

Highway Protocol assumes that the vast majority of network validators are doing their job since they are well incentivized to do so. It also allows nodes to operate at different thresholds of finality, with some allowed to prioritize speed and others latency.

Beyond Highway, Casper also uses developer-friendly languages. Its development ecosystem is designed to be familiar to Web2 developers rather than requiring devs to work in languages like Solidity.

Casper is also developing protocols to assure predictable network fees. A few decentralized blockchains, such as Ethereum, can sometimes be tricky to use due to the volatility of gas. This has been identified as a priority by the Casper team, which aims to establish consistent and transparent gas costs.

What Makes Casper Unique?

The Casper network sets itself apart through several performance features, none more so than Correct-by-Construction (CBC). This network specification allows the rapid adoption of blockchain services and ensures fast and easy upgradeability.

However, CBC was not a Casper invention. It was originally established by early Ethereum developers.

Casper’s upgradeable smart contracts are another stand-out feature. Most blockchains employ immutable smart contracts under the principle that users can trust the code to perform as it is deployed. Like Flow, Casper features smart contracts that can be upgraded even after they go live.

One of the reasons for this approach is that Casper doesn’t really target retail users. Rather, Casper is positioned as an enterprise solution, fully focused on organizations and institutions as the users and clients of the network. For these stakeholders, the ability to upgrade and update smart contracts after deploying them makes life a lot easier.

How is the Casper Network Secured?

Casper is secured by proof-of-stake consensus but with its own twist. Casper’s CBC utilizes an upgraded approach to Byzantine Fault Tolerance systems, giving Casper its extreme upgradeability.

Meanwhile, Byzantine Fault Tolerance is a property that ensures that a proof-of-stake (PoS) system maintains consensus even if up to a third of nodes misbehave. Misbehavior of nodes doesn’t always mean maliciousness—it simply suggests that they aren’t validating transactions or maintaining uptime.

PoS is a method of consensus that replaces proof-of-work’s focus on computation with a system driven by incentives. In PoS, node operators bond a certain amount of native tokens—CSPR, in this case—to become validators.

On Casper, this is called a “self-stake” because other CSPR can stake their tokens to validators. This means that a validator could have more tokens staked to them than just their own.

The main job of a validator is to propose and approve blocks on the network. Without them, a PoS blockchain cannot really function since they also operate all the hardware that the network uses.

If validators behave according to the protocol and do their job well, they are rewarded with new CSPR tokens that are issued through inflation. The more CSPR they stake, the more they earn. However, if they misbehave, they are normally slashed—their stake is confiscated, which means a loss of their investment.

The Casper mainnet currently has disabled slashing. If a validator doesn’t behave according to the protocol, they are instead evicted from the network, and they lose their rewards. When slashing is enabled, misbehavior will result in CSPR token removal as well as loss of rewards during the eviction period.

What is the Use of CSPR?

CSPR is the native and governance token of the Casper network, so it is used as a medium of exchange, as well as for fee payment and network security via staking.

The Casper network’s validators stake CSPR to the protocol, but other holders can also stake their tokens. Token holders can stake their CSPR to certain validators, increasing the total stake attributed to that particular validator. This is called delegation.

Who Controls Casper?

Similarly to many blockchain projects, there are two chief entities behind Casper. One is CasperLabs, which is run by the team behind the project and its developers. The second is the Casper Association, a non-profit that leads efforts around Casper’s adoption and evolution.

One of the Casper Association’s main tasks is accepting validators of the Casper Network as members. These validators can then get involved in Casper Network governance. Meanwhile, CasperLabs plays a major role in the development of Casper but isn’t the only developer of the network.

How Much Is CSPR In Circulation?

CSPR has a circulating supply of 10.45 billion CSPR and no capped maximum since it is inflationary in nature.

Interestingly, the Casper Association used a different methodology for reporting circulating supply for a time. At first, tokens were only counted as being in circulation once they had left their genesis wallets.

Now, more in line with the rest of the industry, all unlocked and transferable CSPR tokens are considered to be in circulation. According to the Casper network’s explorer, over three-quarters of circulating CSPR are staked.

How Do You Buy CSPR?

You can buy CSPR tokens from various cryptocurrency exchanges, including KuCoin, Huobi Global, Gate.io, and OKX.

A majority of the CSPR liquidity is found with stablecoins such as USDT, but trading in fiat currencies and major cryptocurrencies is also possible on some exchange platforms.

Is It Possible to Buy CSPR Instantly?

You can buy CSPR instantly if your trading platform offers custodial storage. This means that the effect of that trade will be reflected immediately in your account once you complete a swap or spot trade.

However, the CSPR tokens you bought remain in the custody of the exchange. Much like buying a traditional company share on a broker’s platform, you hold an entitlement to an asset rather than the actual asset itself.

Most major exchanges are usually good places to store cryptocurrency and could even provide on-exchange staking. However, many investors prefer private custody options because of the failure of custodians like Mt. Gox, Celsius, and Voyager over the years.

How Do You Store CSPR?

If you’d like to take full custody of your CSPR and perhaps even stake it yourself, Casper’s documentation has a detailed guide on doing so. Staking CSPR helps to secure the network and allows you to earn more CSPR from your investment. Even if you don’t want to stake, you’ll need a wallet that can store CSPR tokens if you want to take them off-exchange. The native option is the CasperLabs Signer tool, which you can use on a Chromium-based browser like Brave. You can also use hardware wallets like Ledger to store and stake CSPR.

Like with most cryptocurrencies, Casper wallets have both a public key and a secret private key. You’ll need the public key of your wallet when you want to request a withdrawal from an exchange platform.

Casper Energy Consumption

According to a CasperLabs blog post, the Casper Network is up to 136,000% more energy-efficient than Bitcoin. This was calculated with the assumption that Bitcoin has around 9500 nodes, while Casper has just 400.

Bringing Casper up to a theoretical 10,000 nodes to better equate to Bitcoin’s network size, Casper’s energy efficiency still showed an improvement by some 5400%. However, Casper is a PoS network, and Bitcoin uses a far more computing-heavy PoW consensus mechanism.

In terms of aggregate power consumption, this study rated Casper at 700,800 kWh per year with its 400 nodes. This actually puts Casper at a comparable or higher level of electricity consumption than other PoS networks like Polkadot and Cardano.

Is CSPR a Good Investment?

Casper hits a lot of the right notes when documentation on the project advertises concepts like Web3, decentralization, and the blockchain trilemma solution.

It’s important to note that Casper is very much an enterprise-focused project designed to be adopted by businesses to enhance their efficiency and profit. Upgradeable smart contracts are a big part of this since they mandate that users have to trust the operators rather than the code.

In fact, enterprise users of Casper can decide whether they want to use the public network or a private instance. Hybrid solutions are also offered.

The blockchain trilemma of scalability, decentralization, and security plagues many of the best blockchain projects. This is because most blockchains hold to the philosophy that cryptocurrencies are meant for the masses—at least to some extent. After all, Bitcoin was invented as an alternative to the fractional reserve banking system.

As far as Casper is concerned, the decentralization element of the trilemma is solved by removing major hardware demands. This allows validators to be geographically decentralized and eliminates the centralizing pressures of economies of scale.

Regardless, none of this disqualifies CSPR as a good investment. In fact, the adoption and use of Casper’s technology at scale by enterprises is exactly what a CSPR holder might hope for. In all likelihood, that would massively boost the use of and demand for the CSPR token.