The Evai.io founders and ratings development team are always looking out for innovative projects to analyse and debate with cryptocurrency investors, traders, and enthusiasts. As we prepare to launch “The Bridge,” our pioneering AI and Machine Learning-based analytics tool, we are starting to explore cryptocurrencies at the top of our list to rate when we go live. This week we decided to take a first look at Wanchain and its unique approach to cross-chain transfers.
Wanchain is an ethereum-based public blockchain with smart contract capabilities created by Factom founder Jack Lu. Launched during the ICO boom of 2017, Wanchain’s goal was to connect isolated private and public blockchains to facilitate a cohesive flow of data and combat incompatibility issues.
The project aims to create a new financial market of digital assets by allowing cross-chain transfers between different blockchains. Wanchain is not the only project that is working on this idea. Crossing s-chain interoperability is something that has attracted attention from many developers recently. Therefore, Wanchain has a lot of work to do to convince investors and developers that it is offering anything unique.
What is Wanchain?
Wanchain allows users to transfer assets between different blockchains. This means a user can convert their cryptocurrency (e.g., from bitcoin to ethereum) without having to transact via an exchange.
In addition to cross-blockchain transfers, Wanchain supports other useful financial actions:
- Lending and borrowing
- Exchange and settlement
The DeFi movement has been gaining traction in the last few months. Wanchain’s versatility gives it a realistic chance of competing against rivals such as Ark and Aion, as well as some of the newcomers to the market, such as Chainlink, Polkadot, and Cosmos. With Interoperability easing access to DeFi protocols and potentially increasing their liquidity, Wanchain is tapping into an entirely new use case.
How Does Wanchain Work?
Wanchain combines smart contracts with cross-chain communication to facilitate transfers across blockchains. It is fundamentally made up of three modules:
- Cross-chain transaction data transmission
- Transaction status queries
The registration module registers the original chain participating in the transaction and assigns it an ID, then registers it as transferring, and assigns rules to the dataset.
The user of the original chain delivers a cross-chain transaction request to Wanchain, which is then validated and sent back to the original chain using the cross-chain transaction data transmission module. Validation is performed using a Delegated Proof of Stake (DPoS) system with three nodes validating transactions. Those nodes are vouchers that provide proof of a transaction, verification nodes that provide a record of consensus, and storemen that confirm the keys of locked accounts.
Throughout this process, the transaction status query module monitors the progress of the transaction.
The WAN Token
The WAN Token is used to pay nodes when a cross-chain transaction is being made. Before the launch of its mainnet, WAN operated via the ERC20 token standard, but now has its own (WRC20), and users holding ERC20 can convert it to WAN if they wish.
WAN prices have seen extreme volatility since their ICO. At the time of writing, WAN is valued at around $0.26, down 26% from it’s ICO price.
Being a PoS-based cryptocurrency, holders are able to stake WAN. With a minimum stake of 100 WAN, delegates can earn an annualised return of up to 7.29%.
The Wanchain Team
Headed by founder and CEO, Jack Lu, the Wanchain team cites a wealth of experience within both the tech and business sectors.
Lu himself boasts the co-founder of enterprise-focused blockchain solutions company, Factom, as well as Beijing-based IT firm Wanglu Tech. And Wanchain’s vice president, Weijia Zhang, stands as the Enterprise Ethereum Alliance’s (EEA) regional head of China.
What Else Does Wanchain Offer?
Wanchain’s main ‘product’ is cross-blockchain transactions, but that’s not all it offers. Wanchain has some other notable features:
Existing Ethereum Dapps will run on Wanchain without requiring redevelopment. Wanchain extends Ethereum’s smart contract features with its own API, adding cross-chain capability and privacy features.
The ring signature feature offers privacy for the signer of a transaction while still allowing the recipient to confirm that the sender signed the transaction. This is a feature many other currencies lack. In addition, it is possible to use a one time address to enhance privacy when receiving funds through the Wanchain system.
The Future of Wanchain
Despite its age, Wanchain continues to move with the times—capitalising on its token staking features and turning its hand to facilitating interoperability within the DeFi sector.
Strategic partnerships with Aion and ICON forged early on are a good sign, as is Wanchain’s membership with the Blockchain Interoperability Alliance—two factors which go some way providing the project and its alliances with a competitive edge.
Wanchain also continues to innovate. In Dec 2019, the Wanchain team released its 2020 roadmap, which among a litany of other things aims to instill cross-chain compatibility with a host of blockchains including Facebook’s Libra. A crucial roadmap milestone was hit in January 2020, when Wanchain 4.0 launched—providing support for private blockchains and fulfilling one of Wanchain’s primary goals.
Wanchain has many projects that are trying to achieve the same goals, including Polkadot, Cosmos, Aion, Ark, and ICON, to name just a few. Stiff competition and market dilution could mean Wanchain becomes crowded out as new tech steps in.
Concerns around WAN distribution transparency remain as well. How many coins are allocated to the project team, and whether or not they’re locked up, has never been disclosed.
Moreover, the WAN token itself has left investors with room for improvement, with a negative ROI of – 26% from its 2017 ICO price of $0.34.
If you’re interested in Wanchain or other cryptocurrencies, tokens, and blockchain technologies, be sure to explore our blog and insights. At Evai.io, we are committed to pioneering up-to-the-minute, unbiased information and reviews of cryptocurrencies using AI and machine learning. More about the Evai Rating process.