IRISnet is a blockchain network designed to build a foundation for next-generation distributed business applications. As named after Iris, the Greek goddess and faithful messenger between heaven and humanity, IRISnet enables cross-chain interoperability with its unique service infrastructure.

Blockchain has been developing very fast today and thousands of chains are launched with various functions and applications. However, applying blockchain technology to the real-world distributed business collaboration is still facing challenges. The complicated business logic may not be suitable for on-chain processing. And many applications are in need of a comprehensive system to support cross-chain communication[1]. By building IRIShub based on Cosmos SDK and adding an IRIS service (iService) layer to improve inter-chain collaboration, IRISnet provides a novel network foundation to facilitate the distributed business applications.

1. Consensus and Governance

IRISnet utilizes Bond-Proof-of-Stake (BPoS) to maintain the consensus of its blockchain and blocks are produced by validators elected by delegators. The probability a validator gets picked to propose the next block is proportionate to its total votes received. If a validator’s behavior is considered undesirable, they will be jailed and their bonded token will be slashed. For the double sign violation, 1% of total staked tokens on the validating node, including tokens delegated by delegators, will be slashed and the validators will be jailed for 5 days[2].

Validators are also responsible for on-chain governance through proposal voting. When proposals are submitted for validator voting, a deposit is required to discourage low-quality proposals. Whether the proposal is passed or not, 20% of the deposit will be burned and the remaining deposits will be returned.

Delegators can bond their tokens to validators. Bonded tokens are locked and non-transferable. Delegators can submit a request to unbond tokens but the process takes 3 weeks to complete[3]. To encourage voting, validators often offer to share a percentage of their mining income with their delegators. This has an impact on the validators income which we will cover more details later.

2. Innovative Features

There are thousands of either public or private chains running for different purposes. In the real world, a business may want to utilize resources from various chains and make comprehensive applications. To connect these resources, IRISnet builds IRIShub to allow communications among different chains. And by creatively implementing a set of services interfaces, called iService, IRISnet provides suitable solutions to the real-world business applications.

2.1 IRIShub

IRIShub is a native blockchain of IRISnet to allow value transferring among different blockchains under IRISnet’s network. Different blockchains have their own layers of consensus and applications. IRIShub connects these heterogeneous chains and uses Inter Blockchain Communication (IBC) technology to allow tokens to be transferred from one chain to another safely and quickly. The mechanism is straightforward. When transferring tokens, a representation of these tokens will be created on new chain, along with a proof that these tokens are locked on its original chain. With IRIShub, users do not need to rely on centralized crypto exchanges and can exchange tokens more efficiently. And it makes cross-chain business possible.

2.2 iService

IRISnet applies an innovative feature, iService, to improve its suitability for real-world business applications. iServices is a set of services defined by IRISnet to meet users’ needs. By using iService, users can request services from service providers, who could be users of other chains. If users are not satisfied with the service, they can make a complaint and the arbitrators will participate in the process to resolve the dispute. Because iServices allows service providers to offer service off the chain, complicated business logic could be handled. For example, hospitals could assist medical research without passing the highly confidential raw medical records through iService protocol. iService offers a very convenient and comprehensive structure to assist realistic business because sophisticated business logic can be moved off the chain and only necessary transactions and requests need to be executed on-chain.

3. Token Incentives

IRISnet allows different tokens to be transferred. Users can use all tokens on the whitelist to make transactions. But the staking token and the main fee token are its native token, IRIS. Validators will receive IRIS as rewards to their contribution to the network. The rewards consist of two parts, token inflation and transaction fee. Because the transaction fee on the network is hard to estimate at the moment, we will only consider token inflation in our following analysis. The initial total supply of IRIS is 2,000,000,000 and the annual inflation rate for the first year is 4%[4]. Note that the inflation rate can be modified through on-chain governance. Suppose there are 416,000,000 IRIS staked on the entire network. A validator node has 12,480,000 IRIS delegated from delegators and the validator didn’t stake any token by themselves. Let’s further assume the validator charges a 10% default commission fee, then the returns can be calculated as follows:

Validator’s return:

  • Annual inflation amount: 2,000,000,000 * 4% = 80,000,000 IRIS
  • Tokens minted by the node: (12,480,000 / 416,000,000) * 80,000,000 = 2,400,000 IRIS
  • Commission fee: 2,400,000 * 10% = 240,000 IRIS
  • Validator’s return in first year: 240,000 / 12,480,000 = 1.92%

Delegators’ return:

  • Annual inflation amount: 2,000,000,000 * 4% = 80,000,000 IRIS
  • Tokens minted by the node: (12,480,000 / 416,000,000) * 80,000,000 = 2,400,000 IRIS
  • Income for delegators: 2,400,000 * (1–10%) = 2,160,000 IRIS
  • Delegators’ return in first year: 2,160,000 / 12,480,000 = 17.31%

Based on earlier assumptions, the returns for the validator and delegators are 1.92% and 17.31%, respectively, in first year. It is important to note that the calculation was based on the assumption that all of the voting power comes from delegators and the validator didn’t stake any token.

4. Conclusion

IRISnet provides a service infrastructure for coordinating on-chain transaction processing with off-chain data processing and business logic execution. It offers innovative solutions to cross-chain communication and builds an ecosystem for distributed business. With more and more chains introduced in the future, IRISnet will bridge these distributed resources and power the new-style business applications.

Reference

[1] Theta White Paper, https://github.com/irisnet/irisnet/blob/master/WHITEPAPER.md
[2] Punishment Mechanism, https://www.irisnet.org/docs/features/slashing.html#punishment-mechanism
[3] IRISnet Features: Stake, https://www.irisnet.org/docs/features/stake.html#core-concepts
[4] IRISnet Features: Mint, https://www.irisnet.org/docs/features/mint.html

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