Chain

What is Chain (XCN)?

Chain is a cloud ledger service that aims to allow enterprises to adopt blockchain technology quickly.

Chain lets any sort of organization set up its own permissioned blockchains or connect to a list of other major networks with ease. With its ecosystem of products—including Chain Cloud and Chain Sequence—Chain utilizes a compelling model that could be described as ledger-as-a-service.

When Was Chain Launched?

Chain was originally launched in 2014 and has received $40 million in capital from Khosla Ventures, Pantera Capital, Capital One, Citigroup, Fiserv, Nasdaq, Orange, and Visa.

Stellar acquired Chain in 2018 to form Interstellar by Lightyear Corporation, the commercial arm of the Stellar Foundation. The price of the acquisition was undisclosed, but Forbes claimed it was the equivalent of $500 in XLM.

In 2020, Chain was re-acquired. It now operates as a privately held corporation with a newly established board of directors, officers, and shareholders. According to its whitepaper, Chain is a corporation based out of Saint Kitts and Nevis.

Who are the Founders of Chain?

Chain was founded by Adam Ludwin, a fintech professional formerly of RRE Ventures and Boston Consulting Group. Ludwin has been credited with investments in companies such as Vine, Slack, Kik, and Paperless Post. He is a graduate of UC Berkeley and has an MBA from Harvard Business School.

One of the other most prominent personalities connected to Chain is Deepak Thapliyal, its CEO and Chairman of the Board. Thapliyal is known for his work on arbitrage trading systems.

How Does Chain Work?

Chain’s offerings revolve around its ecosystem of products targeting legacy financial systems and public blockchain infrastructure. This ecosystem comprises Chain Cloud and Chain Sequence.

Both of these major product families are backed by Chain’s TxVM—the transaction virtual machine. TxVM allows Chain to incorporate immutable smart contracts into its ecosystem, similar to the Ethereum Virtual Machine.

What is Chain Cloud?

Chain Cloud is a decentralized, distributed infrastructure protocol that allows developers on-demand access to independent blockchain networks. Chain’s enterprise clients can utilize various services within Chain Cloud to meet their blockchain and Web3 product needs.

Chain’s Web3 offering begins with its free Standard RPC API for several public blockchain networks, including Ethereum and Bitcoin. Chain documentation provides detailed information on all supported chains.

Chain Cloud’s RPC layer is based on a globally distributed network of nodes, creating a decentralized RPC API designed with a fail-safe architecture.

All RPC API endpoints are constantly in sync with the underlying nodes, and Chain Protocol routes network traffic to ensure optimized routing and speed.

Meanwhile, Chain Cloud’s Premium RPC API allows developers to access a range of services to build projects on applications on a fast, secure, and private network. This Premium service is paid for annually in XCN tokens, with rates defined by Chain Governance.

Chain Cloud Nodes are deployed by Chain’s clients and are constantly monitored. These nodes belong exclusively to the client, so they can run enterprise services or connect to the Chain Protocol. These nodes have unique addresses and their own set of authentication keys, and they come in two forms:

• Protocol nodes. These are dedicated nodes deployed through the Chain marketplace for devs to connect to Chain Protocol. These nodes require XCN to be staked and bonded to the network in order to establish a connection with the protocol. Once connected, they can receive XCN rewards for providing their computing resources to the Chain Standard RPC API.

• Enterprise nodes. These are also fully dedicated nodes connected through the marketplace, but they do not require staked XCN. They can be accessed only by the developer for their own projects. They can, however, be used to stake and delegate native tokens in their respective networks.

What is Chain Sequence?

Chain Sequence is a cryptographically secured, permissioned blockchain ledger service. Its purpose is to allow clients to focus on shipping and scaling their products rather than expending resources by building and maintaining ledger infrastructure. It does so by combining the SaaS model with cryptographic transaction signing.

Sequence is made up of a number of ledgers, each of which is an immutable and append-only data structure. Balances on these ledgers are represented by token-like objects called assets, which can be created, transferred, retired, or entered into other programs.

Sequence allows developers to quickly commercialize software products that require a secure and extensible system of record. Sequence essentially provides clients with a secure blockchain ledger, and both free and premium versions of Sequence are offered.

The Sequence NFT product family also forms part of Chain Sequence. This is a managed service that allows any organization to launch its own branded, bespoke NFT solution. Chain provides these clients with an end-to-end solution for the design, development, compliance, sale, and utilization of Sequence NFTs.

What Makes Chain Unique?

The Chain Protocol is interoperable to an extent in that it supports multiple independent networks. Thanks to Chain’s blockchain agnosticism, it lets clients take advantage of the best option among those available.

The Chain Protocol also allows any user to issue assets. These assets are easy to create and deploy with their relevant programs. They can also be used to build complex systems of smart contracts.

Finally, while not quite unique in this regard, Chain is targeted purely at enterprises. A lot of its funding from major financial institutions reflects this.

How is the Chain Network Secured?

Each permissioned network setup for Chain clients is secured by a group of block signers. Block creation is delegated to a single block generator, and any network node can validate blocks. This system is secure as long as a certain number of block signers behave according to the protocol.

The XCN token itself and its token balances are secured by the Ethereum blockchain. Ethereum is a proof-of-stake (PoS) blockchain that switched away from proof-of-work in September 2022.

PoS relies on a cryptoeconomic system to ensure that its key participants, validators, behave according to the protocol. Each validator stakes or bonds a minimum of 32 ETH to the protocol before it is allowed to validate blocks.

This stake can be slashed—or confiscated—if the validator misbehaves. On the other hand, they also receive rewards in ETH when they behave according to the protocol.

What is the Use of XCN?

XCN is Chain’s utility and governance token. It is used for voting on protocol improvements and updates through the Chain DAO. It’s also utilized for node deployment, premium access, and payments on Chain Cloud and Sequence.

XCN is meant to be staked, and stakers can take part in governance. Staking XCN also sees stakers rewarded with more XCN, so staking XCN is a useful form of passive income for smallholders as well.

Who Controls Chain?

The Chain Protocol is controlled by the Chain DAO (Chain Decentralized Autonomous Organization). Holders of XCN that stake their tokens receive a Chain Governance vote, with each XCN token staked representing a single vote.

The Chain DAO has a Constitution that sets a standard of rules and practices for safe and healthy operation. Governance smart contracts control all operations of the DAO, including its treasury and protocol parameters such as fees and rewards.

In fact, Chain Governance utilizes a battle-test codebase designed by the Compound community.

Currently, 100 million XCN is required to put forward a proposal, with 200 million XCN worth of votes required to reach a quorum.

How Much XCN Is In Circulation?

Chain has a fixed maximum supply of over 53.47 billion XCN, out of which over 21 billion XCN are currently in circulation.

15 billion XCN has been set aside as a company allocation. Granted to Chain’s parent entity, these tokens are locked in a Time Lock smart contract which will begin releasing 200 million XCN per month in April 2023.

The team behind Chain, including its founders, team members, community managers, and developers, received 5 billion XCN. These tokens are also vested, with 100 million XCN unlocking monthly beginning in April 2023.

Finally, the Chain DAO also has a significant XCN allocation. Its 10 billion XCN treasury is controlled by Chain Governance Stakers.

How Do You Buy XCN?

You can buy XCN on several major cryptocurrency exchanges, as its time in the market ensures decent availability.

XCN can be purchased with fiat currencies like USD or KRW depending on the region served by the exchange, but plenty of stablecoin trading is available as well.

Is It Possible to Buy XCN Instantly?

Yes, it is possible to buy XCN instantly from most cryptocurrency exchanges. If the exchange uses a custodial model, your trades will be reflected in your account immediately.

However, if you wish to stake XCN and participate in Chain DAO governance, you may have to withdraw your XCN tokens into a private wallet.

How Do You Store XCN?

You can store XCN if you want to make a profit conveniently, and as a bonus, some exchanges may allow you to stake XCN on-platform. As mentioned, though, taking part in governance means needing a private wallet of your own.

Visiting Chain’s governance portal makes staking easy. You can do so using wallets like Metamask, Trust Wallet, Coinbase Wallet, or a Wallet Connect-compatible wallet.

Chain Energy Consumption

It is difficult to estimate Chain’s true impact in terms of energy consumption thanks to its use of the ledger-as-a-service model. Granted, permissioned blockchains don’t require huge numbers of decentralized nodes, but more nodes do come online as more companies adopt Chain.

Chain’s CSR initiative, Chain Gives, is an innovative example of using blockchain charitably. The program uses blockchain technology to send funds swiftly and securely to those in need far more swiftly and safely than traditional finance could.

Is XCN a Good Investment?

Chain is firmly in the enterprise camp, and a glance at its list of funders, including Nasdaq and Visa, shows exactly whose lives Chain aims to improve.

However, the disruption of traditional—and often monolithic and inefficient—financial systems is hardly a sin. While it doesn’t promise to benefit individuals like so many cryptocurrency projects do, Chain could improve the systems billions of people use every day.

This makes Chain a compelling investment case since the XCN token is central to both Chain’s services and its governance. Being part of the Chain DAO and helping to set the direction of the Chain Protocol may be an irresistible proposition for many.

It is also worth keeping an eye on the circulating supply of XCN and the terms of the Time Lock smart contracts vesting team and company tokens. Once these begin to hit the market in April 2023, XCN will begin to dilute.