What is Harmony (ONE) | What is Harmony token | What is ONE token

What is Harmony (ONE) | What is Harmony token | What is ONE token

Harmony aims to offer a fast and open blockchain for decentralized applications. The protocol, according to the team, has achieved secure and random state sharding. Harmony Mainnet can reportedly support thousands of nodes in multiple shards, producing blocks in a few seconds with instant finality. Its staking mechanism reduces centralization while supporting stake delegation, reward compounding, and double-sign slashing. Harmony aims to build an open network of nodes operated and governed by a large community. What is Harmony (ONE) | What is Harmony token | What is ONE token

Harmony (ONE) is one of the latest projects that is trying to tackle the issue of blockchain scalability. They have built their platform from the ground up with optimisation in mind.

Using a “full-stack” approach, Harmony is developing a  sharding based blockchain that is not only scalable but provably secure, and energy efficient. They are also the latest project to be raising funds on the Binance Launchpad. This after completing a large private seed sale back in May of 2018.

So, should you consider it?

In this Harmony review I will give you everything you need to know to make that decision. I will dig into their technology, team and development. I will also analyse the long term adoption potential of their ONE token.

What is Harmony?

Harmony provides a high-throughput, low-latency and low-fee consensus platform designed to power the decentralized economy of the future. They plan to address the issues faced in other blockchain ecosystems through the use of the best research and engineering practices in an optimally tuned system.

The technical focus of the project is on resharding and secure staking with decentralized randomness. Harmony also implements optimal cross-shard routing and fast block propagation.

In practice, Harmony helps businesses to build marketplaces for fungible token usage (such as loyalty points or energy credits) and non-fungible assets (such as in-game digital assets). Harmony also uses its  zero-knowledge proofs to enable data sharing with consumer privacy.

Benefits of Harmony One

Benefits of the Harmony Protocol. Image via __Harmony.one

This incentivizes users and could be used for credit ratings, ad exchanges, and other data sharing that’s traditionally seen centralized platforms profiting and users being left with nothing.

After launching its mainnet in June 2019 Harmony has seen excellent growth, and as of June 2020 there are more than 1,000 nodes helping to decentralize the network. The project has also been able to migrate from the ERC-20 and BEP-2 tokens originally issued to its own native tokens.

Finally, the project has implemented a staking system based on Effective Proof of Stake (EPoS). It’s been a busy year at Harmony, so let’s dig in and explore some of the details of the progress being made.

The Harmony Technology Stack

In order to achieve the goals of scalability the Harmony built the entire technology stack from the ground up with a focus on optimisation. They have built in a number of important innovations into their Consensus Protocol, internal systems and network engineering.

By implementing these innovations, Harmony will provide a platform for Decentralised Applications (dApps) which were not feasible on other blockchains. These include dApps such as decentralised exchanges, high-throughput payment systems and Internet-of-Things transactions.

Consensus Protocol

Blockchains are goverened by consensus and the type of protocol used can drastically impact on the speed with which decentralised consensus is achieved. Currently, blockchains such as Bitcoin’s, use Proof-of-Work consensus protocols which have become inherently expensive and slow.

Other protocols such as Proof-of-Stake use different incentive mechanisms that overcome some of these challenges. Indeed the Ethereum protocol is trying to move to their Casper PoS consensus to address their scalability issues. However, PoS has its own unique challenges.

Network Communication Harmony

_Network Communication in a round of Consensus. Source: [Whitepaper_](https://harmony.one/whitepaper.pdf)

The Harmony consensus protocol, which they call Effective Proof of Stake, uses the latest design principles such as sharding and pipelining. This allows the network to process numerous different transactions in parallel. This means that there is no single bottleneck to the confirmations for all of the transactions.

Essentially, with the Harmony approach, connection latency is greatly reduced and the transaction throughput can scale as the network grows.

Network Infrastructure

Harmony is implementing networking techniques that can improve the speed of message propagation and achieve consensus faster. As stated in their whitepaper, Harmony uses RaptorQ fountain code which allows the network to propagate blocks quickly or within shards. Not only does Harmony shard its network nodes, it also shards blockchain states, which allows for linear scaling in all three aspects of storage, transactions, and machines.

They also adopt Kademlia routing which is able to achieve these cross-shard transactions which can scale logarithmically with the number of shards in the network. This entire implementation allows Harmony to run a highly concurrent protocol.

The infrastructure has also been decentralized to avoid single shard attacks. Eventually the network is built to contain shards of 1,000 nodes in order to provide cryptographic randomness and to re-shard regularly, however currently Harmony is using four shards of 250 nodes each.

This gives the network a strong security against Byzantine behaviors. In addition the network uses a Verifiable Random Function for unpredictable and unbiased shard membership.

The ONE Token Ecosystem

The Harmony platform is powered by the native ONE token, which allows users to participate in the ecosystem and serves as a payment mechanism for various actions. By using the Harmony blockchain developers and businesses are able to create alignment in the goals and incentives of various stakeholders.

In addition, the upcoming zero-knowledge proof implementation will make Harmony a data sharing platform that is capable of overcoming the common problem of many data markets; that is the mistrust that participants have for sharing data, even as they have a strong desire to acquire the data of others.

Harmony Token Ecosystem

“Open Consensus for 10 billion people”. Image via Harmony

The Harmony ONE token is designed to have the following three functions within the protocol:

  1. The token is used as a stake for the  EPoS consensus model, allowing staking holders to earn block rewards and transaction fees.
  2. The token will pay for transaction fees, gas fees and storage fees.
  3. The token will be used in the governance of the protocol by allowing token holders voting rights for on-chain governance.

In January 2020 Harmony kicked off the migration of the ONE token from the Ethereum and Biannce chains to its own blockchain. This was needed to realize the plans for staking and on-chain governance. Users are required to swap their ERC-20 (Ethereum) and BEP-2 (Binance) tokens for native ONE tokens if they wish to participate in staking, governance or any other network activities.

As of June 2020 the harmony team has not announced a deadline for the swap to the native ONE coins. Holders should know there is no way to manually swap the tokens to mainnet coins. The process is done automatically on any exchange that is participating with a bridge to Harmony.

That includes BitMax, Binance, KuCoin, Gate.io and the staking service HonestMining. To make the swap simply deposit any ERC-20 or BEP-2 ONE tokens on a participating exchange and when withdrawn the native ONE tokens will be delivered.

Staking Harmony ONE Token

Harmony made history on May 16, 2020 when it launched staking, making it the very first sharded blockchain to offer staking. According to the Harmony team staking was necessary in order to create trust for network participants without knowing them.

This will allow for much greater decentralization as it opens up the protocol to the public. Now that staking has been made available 320 of the 1,000 nodes are being run by the public rather than by Harmony or one of its trusted partners.

Harmony One Validators

List of Some of the Validators Staking Harmony. Image via __Harmony

Staking launched with 16 staking partners who can be used by anyone to easily stake coins. These partners include Staked, Stake.fish, Blockdaemon, Everstake, and InfStones among others. Several exchanges also provide staking, such as BitMax and Binance. The current reward for staking is just north of 10%, although any of the staking services will keep a small portion. You can see a full list of current staking services here.

It isn’t required to use a staking service though, and the Harmony team encourages standalone staking because of the decentralization benefits. Running a validator requires 10,000 ONE tokens (currently worth $43) as well as a computer with a minimum of two cores, 2GB of memory, and 30GB of storage.

However due to the current limit of 320 public nodes the actual minimum required to run a node is roughly $20,000 worth of ONE tokens. Eventually there will be slots for 1,000 public validators.

The Harmony Community

Harmony has pursued a blend of offline and online community building. Since 2017 the Harmony team has held a weekly 4-hour meetup in San Francisco to increase interest in the project and to increase its community of partners.

The online community building has led to a smallish group, but one that appears to be extremely well engaged and excited about the potential for the Harmony protocol. For example, the Harmony subreddit has just 1,300 readers, but there are multiple daily posts and a number of comments on each post. The subreddit has only been in existence for 3 months.

Other social media accounts are equally small, but with equally engaged communities. The Twitter account has just over 6,000 followers, but an outsized number of shares and comments on its tweets. The Telegram channel is the largest community, with over 11,700 members.

Overall the Harmony community is a positive and encouraging sign. It may be small, but the members are very engaged and excited about the possibilities of the protocol.

The ONE Token

As noted above the ERC-20 and BEP-2 ONE tokens have been deprecated and the official coin is now the native ONE coin. Users holding the Ethereum or Binance chain versions can easily swap them by depositing them at an exchange that has a bridge to Harmony, such as Binance, Gate.io, BitMax, and others. Once deposited the deprecated tokens are automatically converted to native ONE tokens.

Binance ONE

Register at Binance and Swap ERC-20/BEP-2 Tokens for Native ONE Coins

As a staking token ONE is expected to gain in value, and in fact it has doubled since hitting a mid-April low of $0.002109. The real gains began after Harmony announced staking, with the token jumping from a value of $0.002684 before the announcement of live staking, to $0.004310 just one month later. It should be noted that this is slightly below the $0.004730 value of ONE on January 1, 2020 but the upward momentum is promising.

As far as storing your ONE tokens, the Ledger is your best choice. There’s no native staking wallet yet for ONE, but it is in development. In the meantime the multi-currency Guarda, Trust Wallet, and math Wallet all support storing ONE coins.

Launching Full Ethereum Compatibility on Harmony

At Harmony, our roadmap  in 2021 is to scale Ethereum applications and cross-chain finance. Today we’re excited to announce a critical milestone in our pursuit — full compatibility with Ethereum tools — Metamask, Web3.js, Ether.js, Truffle, Remix.

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Over the past few months, we have met with many developers, organized a few hackathons, conducted community calls, followed the spectacularly exploding DeFi and NFT space — all of this to understand what are the hurdles for developers to grow and scale their applications, and what prevents millions of more users to benefit from decentralized finance, social money and digital collectibles communities powered by blockchain.

The answers and insights are rather practical. Developers and users are already familiar with the mature Ethereum ecosystem but are looking for lower fees and faster transactions. Porting assets and deploying applications to a new platform needs to be simple, it should only take from a few seconds to a few minutes. This drove us to prioritize completing a **[full Ethereum tool-chain support](https://docs.harmony.one/home/developers/ethereum-tooling-compatibility) on Harmony —** Developers can now easily port their applications already written using ether.js or web3.js onto Harmony. Users can use the Metamask wallet to transact their assets on Harmony, without worrying about high fees or latency.

What Ethereum compatibility already exists on Harmony?

  1. Harmony is fully EVM compatible, already supporting Ethereum v1.9.9 Muir Glacier.
  2. Ethereum-Harmony Horizon bridge, using which you can bring ETH and ERC20/HRC721 assets to Harmony and take ONE and HRC20/HRC721 assets to Ethereum, in a permissionless way. Try it out here.
  3. Deploy smart contracts using Truffle and Remix.

What are we launching today?

As of Epoch 442 (Thursday, February 4, 2021, ~10am PT), Harmony will support Ethereum RPC, which means we can now recognize the Ethereum transaction data structure.

What does this mean:

  1. Users can now connect to the Harmony network using Metamask wallet.
  2. Users can create accounts, send and receive transactions of native ONE or HRC20/HRC721 using Metamask.
  3. Users can interact with dApps written using web3/ether.js but deployed on Harmony, simply using their Metamask account.
  4. Developers can directly deploy dApps written using web3/ether.js on Harmony.

If you’re keen to know details about how we made this happen, here’s a technical snippet.

Harmony’s transaction data structure includes two additional fields, ‘ShardID’ and ‘ToShardID’, on top of Ethereum’s transaction structure. Metamask didn’t work with Harmony out of the box since any transaction submitted by Metamask to the Harmony nodes across shards would not have the ‘ShardID’ and ‘ToShardID’ fields and as a result be rejected.

To solve this, the core developers proposed a new logic that lets shards recognize the original Ethereum transaction data structure without ShardID and ToShardID in it. This way the original Ethereum transaction can be treated and processed as an intra-shard transaction.

Now, Harmony reserves a unique ChainID for each shard and assigns transactions to shards based on the ChainID, which can be derived from the V field of the txn signature. With this change introduced in the latest node-software, the new transaction type can be accepted and processed by the validators across shards, making Harmony fully-compatible with existing Ethereum tooling.

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How to navigate between Harmony and Ethereum address format?

For each Harmony account address (‘one…’), there is a corresponding Ethereum address format (‘0x…’). You can easily find the ONE-Ethereum corresponding address pair on the Harmony Explorer, just toggle to switch between the address format.

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you can toggle between the Address formats on the top

ONE address

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Ethereum address

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_Note: _when using Metamask to send transactions on the Harmony network, you have to specify the corresponding Ethereum address format (starting with ‘0x’), instead of the ONE address ( starting with ‘one’). On the Harmony ONE wallet, you can send transactions using either the ONE or corresponding ETH (‘0x’) address format.

What can users and developers do?

Connect Metamask with Harmony. You can find detailed instructions here.

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Harmony custom RPC for Shard 0 on mainnet

After connecting Metamask with Harmony Shard 0 on mainnet, you can easily do the following:

  • Import an existing Harmony account into Metamask using your private keys.
  • Create a new Harmony account directly on Metamask, which can later be imported into ONE wallet, if needed.
  • Receive ONE and HRC20 tokens in your Metamask account from any Harmony account.
  • Send ONE and HRC20 tokens from your Metamask account to any Harmony account, using the Ethereum address format of the recipient account.
  • Search for your transaction history on Harmony block explorer, using your Ethereum or Harmony address format.

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