Bulletproofs Merge

Yesterday the network was upgraded to “bulletproofs” version of Monero.

This is a significant upgrade that brings important new features and improvements to the network such as much smaller block sizes, multi-signature wallets, and better security.

The merge has been quite a bit of work and we’re excited to get this done as it paves the path to other network features on the roadmap.

Congratulations to the team and community. Thanks for the hard work!

You can find the latest 1.8.2 Release HERE





The Role of Stable Coin in GRAFT Network

Recent announcement from JP Morgan about the launch of JP Coin (albeit used internally for now) is just the latest in the wave of stable coin developments.

2019 is looking like it might just be a year of stable (tethered) coins after all, and for a good reason. If you believe, like we do, that cryptocurrencies main vectors of expansion are fiat currency augmentation or replacement and transaction optimization (in addition to existing speculative investment and asset diversification), stable / tethered coins will play a critical role in this next leap forward.

Consider a real alternative payment network like GRAFT. While merchants (and the users) are interested in switching to cryptocurrency for transactions, one of their biggest concerns for the merchant is the fluctuations that go along with the volatile nature of the cryptocurrencies.

Merchant wants to receive the value for the product they have sold without taking a extra gamble on whether they get more or less money than they are owed based on the underlying wild currency fluctuations. That type of guarantee can be accomplished one of two ways – either every transaction immediately gets converted into fiat, or.. ,the transactions get converted into an interim “stable” coin that holds its value, and at the end of the day, all the transactions get tallied up by the merchant service provider and are settled into the merchant’s fiat bank account. It is this latter model that the merchants and MSP’s are used to today, and the one that requires the least amount of change for everyone involved.

To enable this latter model of merchant service provider holding the merchant funds in stable coin currency (preferably in a multisign merchant specific wallet), GRAFT will first be partnering up with a stable coin underwriter to make it available as part of the Payout broker, and later will be opening it up to a choice of stable coins*. The stable coin / payout token concept has long been an important part of GRAFT’s vision and it’s encouraging to see many different entities step up to the plate to offer such product – the timing is perfect!

* We are currently collecting interest from the stable coin providers and the first stable coin implementation will be auctioned off to the highest reputable bidder

The future of GRAFT as Delegated Proof-of-Stake (DPoS)

It’s Valentines day, so we thought it would be appropriate to show some extra love for GRAFT 🙂

We wanted to lift up the covers a little bit on what we’ve been thinking about over the past few months as what the future holds for GRAFT’s technology. Please meet the beginnings of LYRA DPoS*- the Next Big Thing for GRAFT Platform, based on the most recent advances in the field.

Down cycles provide an opportunity to hunker down and build a great solution in preparation for the upturn and market expansion. The market WILL return and when it does, it will reward those who have the most advanced technology for the application, so we need to be ready for that!

The keyword is BUIDL!

Enjoy the read – we hope you will come away as inspired as we have been with it!
As usual, we welcome your feedback – please use github’s issue subsystem to comment.
https://github.com/graft-project/LYRA

* DPoS stands for Delegated Proof of Stake

** GRFT isn’t going away – it will remain the voting and gas/reward currency in the new DPoS platform

Nicehash Attacks Update

As many of you know, GRAFT and numerous other projects are being regularly attacked using Nicehash (service providing hash power on demand). The attackers’ goal is to perform a sustained 51% attack to produce an alternative chain that would include their own double-spending transaction in it, and attempt to withdraw the funds from the exchange before the network adopts a new chain.

These attacks are unpleasant for several reasons: 1) the exchanges have to raise number of confirmations leading to very long withdrawal and deposit times, 2) some legitimate transactions get stuck while being written to the alt-chain, and it takes days until they get reversed.

What others have done:

A common approach is to create a small tweak to the hash algorithm, or use existing tweaks.

https://www.graft.network/wp-content/uploads/2019/01/CryptoNight-PoW-Versions-1.pdf

The downside of this approach is that it requires coordinated changes to the node, miner software, and pool software. (some of it is going to happen organically since miners are incentivized, but it is far from guarantee as practically no software miners support all the changes listed above).

What we plan to do about it:

The best approach to solving this problem at this time is something like ChainLocks, which is using the 2nd layer network to help validate the blockchain. This approach is much more robust and provides a long-term solution to the issue. The “ChainLocks approach” will take some time, however, as it’s reduced from conceptual to practical implementation and will rely on having a robust 2nd tier network to execute it, so we’re looking at 4-6 months out.

We recognize the need to deal with this issue now, however, and as such have decided to implement our own unique CryptoNight variation (more details will be published soon, after we finish preliminary testing). Rolling out this tweak will not be trivial, however, as again, it will require support from mining software and pool software. We will create a separate testnet for the new PoW algorithm and will rely on the miners community to not only test for robustness and unintended consequences, but also engage with the mining and pool software publishers to incorporate the change.

Keep in mind that any new hash algorithm solutions are temporary and are only effective until Nicehash adds support for it, which is driven by economics of the gains for the Nicehash community.

Additional Information

We’ve done some polling among the miners as to what mining software they use and how likely they would be to switch mining software if necessary. Here are some results so far, but we welcome you to provide your feedback as well.

https://docs.google.com/forms/d/e/1FAIpQLSdt85jV4QxY2a3N8jD6bj4SGSuDnEp4G0xc4QVNfyLiZLIZdA/viewform

Update

Earlier this week we implemented a tweak to CN8 algorithm we dubbed CryptoNight Waltz, which will prevent the attackers from using available Nicehash hashing power.

We have put together a private testnet. To test download CryptoNight Waltz here Seeds:

  • 54.208.86.27:28880
  • 54.144.192.6:28880
  • 35.175.164.180:28880
To launch miner on the node simply run node and enter command “start_mining

The main reason we created this testnet is to add the possibility for miner and pool maintainers to add and test support of CryptoNight Waltz. Please help reach out to your favorite mining software maintainer or pool operator to get them to update their software. We will not be able to roll this patch out to the Mainnet before we have that support.


Enterprise Perks and Rewards on GRAFT Blockchain

Paypal recently revealed that it was playing around with payment blockchain for its own internal “perk and rewards” purposes. Quoting the article,

“PayPal’s new blockchain platform rewards employees in crypto-tokens, but they only have value inside of PayPal and the platform. Staff can earn tokens by joining innovation programs and contributing ideas, they can also trade tokens. The token transactions will be recorded on the platform’s blockchain ledger and can be redeemed for over different 100 rewards, or experiences. These range from poker tournaments with PayPal vice presidents, a morning of martial arts with PayPal CEO Dan Schulman to borrowing the dog of the head of the investor relations.”

We at GRAFT have long seen this as one of the most viable early use cases for a payment blockchain adoption by the enterprise, and it (along with merchant loyalty programs) was the impetus behind GRAFT Network’s plans for secondary tokens and virtual private chains.

Going down this path what Paypal and others will likely discover the following:

  1. They will struggle with centralized vs decentralized approach to the blockchain. On one hand, yes, they can spin up a Hyperledger and do their own hosting, but they will be responsible for the security and the uptime – and the stakes are high as this is REAL money that can be traded for goods and services

  2. They will struggle with transaction speed and privacy Should this blockchain be public where everyone can see where their coworker is spending their perk dollars, or should it be private? The answer most likely is that privacy IS important, which rules out Ethereum token solutions. Speed wise, even though Hyperledger for instance provides a good TPS, it’s not a GUARANTEED TPS and is subject to bottlenecks.

  3. They will have to figure out how to store and accept the tokens, meaning that they will have to develop their own wallet and POS/Terminal applications and web plugins.

  4. They will face a question of portability Should these tokens be exchangeable for good and services outside of the immediate “walled garden” of perks (think cafeteria credits, child sitting credits, Uber credits, etc)?

  5. Finally, they will have to think about maintainability People inside corporations leave and move to other jobs, projects get deprioritized, the organizations goes through growth and cuts. Maintaining a in-house system is a big commitment for an organization.


A payment network like GRAFT makes for a good solution for this use case as it provides support for the company (aka merchant) tokens and private overlay networks while leveraging the robust features of the underlying POS-compatible permissionless blockchain network, ready made apps (POS/terminal and wallet) that can be customized by the commercial entity to their needs and branding, and an infrastructure of service brokers that can provide exchange capabilities and various other services and applications.

We invite Paypal and others who are considering offering a “perk money” program based on a blockchain designed for payments to explore GRAFT Network as a potential solution.

How GRAFT Is Similar To And At The Same Time Different From Visa And Other Payment Card Networks (Part 2)

Slava Gomzin, Co-Founder of GRAFT

In the previous post we reviewed the similarities between GRAFT and plastic card networks. Now let’s review the differences.

Difference #1 – Decentralization

There is such a key property of GRAFT Network that fundamentally differentiates it from plastic cards. Unfortunately, not all buyers realize and appreciate this property immediately because it is not that obvious to the average consumer, especially in developed countries. And let’s be completely honest with ourselves here – not everyone cares about this property – it’s not until you find yourself in, not before your get into a situation that it suddenly becomes very important. I am talking about decentralization.

The card processing consists of several elements represented by multiple corporations: payment networks (Visa, Mastercard, American Express, etc.), issuing and acquiring banks (such as Chase, Bank of America, etc.), and payment processors (such as First Data, Heartland, etc.). Each corporation has its rules and compliance to national governments, which means they can reject any merchant or buyer, anytime. They can put you out of business, make you “persona non grata” – without any reason, notice, or explanation, just because you don’t fit their requirements – by declining your credit card application, decreasing your credit limit, locking your funds, or cancelling your merchant account. Millions of people live behind the “invisible wall” built by those corporations and governments, without access to banking system, i.e. without ability to use credit/debit cards.

Unlike plastic cards, GRAFT Network does not belong to anyone. GRAFT is more a protocol rather than a product due to its open source nature and peer-to-peer architecture. Therefore, the buyers and merchants cannot be either rejected or approved: they simply connect to the network (by downloading free apps) and start using it, no strings attached. But remember that unlike typical ”bare” cryptocurrencies, the features #1 – 4 from above are still there to satisfy both buyers and merchants standards on the same level as they are satisfied by payment card processors, only without centralization.

Difference #2 – Privacy

Another key difference is somewhat related to #1; however, it is completely separate feature, which is achieved by using special additional technical means rather then just solely based on the fact that GRAFT is independent from corporations and governments. What’s really similar to #1 is the fact that for some people this property may not been important at first glance – again, until you get into specific situation when it does become important. This property is absolute privacy provided by GRAFT Network to both buyer and merchant. Unlike plastic cards and most cryptocurrencies, GRAFT’s sender address, recipient address, transaction amount, and transaction fee amount are invisible to everyone except for the sender and recipient themselves. Although payment card networks do not expose the details of transaction to the public, this data is accessible by employees of multiple corporations, can be shared with governments, and can be stolen by hackers. Unlike plastic cards, no employees or hackers can access GRAFT transaction data which is encrypted forever – thanks to strong cryptography and underlying blockchain’s CryptoNote protocol.

Difference #3 – Security

Security is another thing that differentiate GRAFT Network from plastic cards. I spent years working on security of plastic cards payments . This technology was created in 1960s, and improved in 1990s by introducing EMV – “chip and pin” cards. But back then, even in 1990s, people were not very familiar with terms like “cybersecurity” or “hacker”, so the technology was not designed with security in mind. The result – a multi-million industry called “credit card fraud” that flourishes to this day.

I am not saying cryptocurrencies don’t have security issues at all – everything related to computers and network has potential security issues. However, if you manage your wallets and keys properly, the security of GRAFT for both buyers and merchants is much stronger than plastic cards: no chargebacks, no lost or stolen cards with the primary account number embossed on the face of the card, and no hacked point of sale systems with millions and millions of payment card records stolen and sold on dark market.

Difference #4 – Technology

Let’s not forget about technology – payment cards use centralized networks, relational databases, and centrally managed customer and merchant accounts. GRAFT uses decentralized peer-to-peer network, distributed blockchain database, and random wallet addresses which are not linked to customer identities.

GRAFT “inherits” all the positive features of traditional payment card processing networks while offering solutions to negative sides of centralized, insecure, olding technology. Give it a try!

How GRAFT Is Similar To And At The Same Time Different From Visa And Other Payment Card Networks (Part 1)

Slava Gomzin, Co-Founder of GRAFT

GRAFT Network is often compared to credit and debit card processing networks such as Visa, Mastercard, and other plastic payment brands. Most of the time such a comparison is focused solely on the differences while in fact GRAFT and payment card networks have some (good) things in common. In this post I will try to describe both similarities and differences.

Let’s start with the good things that both GRAFT and plastic cards have in common. GRAFT “borrowed” many good features from payment cards, which have been tried and tested for over 50 years, and become a defacto standard for payments in that time.

Similarity #1 – No cost to the user

Traditionally in cryptocurrency, transaction fees are paid for by the buyer – a practice that goes against the grain of payment workflows in the global merchant space, where transaction fees get charged to the vendor. Just like with plastic cards, GRAFT Network does not charge the buyer a fee for processing a payment transaction. This difference might seem to be insignificant, but in reality it is one of the most important features which positions GRAFT on the right side of the user experience battle. After so many years of plastic card payments, where the buyer is not even aware of transaction fees paid by merchants, Bitcoin and other crypto started “forcing” consumers to pay “network” fees for each transaction including in-store purchases. This setup creates an inhibition to spending and is one of the reasons cryptocurrencies are still not widely supported by mainstream consumers as a payment method at checkout. In some cases, the fees reach an incredible amount, often making the purchase itself illogical. Would you buy a cup of coffee that costs $3 and pay another $1 (extra 33%) as a “network fee” if you can pay just $3 by credit or debit card? GRAFT resolves this problem by charging the merchant instead of the buyer, just like plastic cards do, leaving it to the merchant to price their goods and services accordingly

Similarity #2 – Predictable transaction costs

There is another, more serious problem with cryptocurrency transaction fees: inconsistency. Retail is a tough business with small margins, and it likes predictability. Retailers want to be able to know in advance what part of the revenue they take home and what part they pay to the payment processor. Payment card brands recognized this issue many years ago and resolved by setting very consistent rules. The fees may vary based on amount and type of transaction, but they always can be calculated in advance. The most important rule is that there is always a rule. For example, the processor can charge the merchant 3% + $0.20 for each transaction. If the merchant sells its product for a total of $10,000 today to 100 customers, they know they will pay $320 in transaction fees.

Unlike payment cards, blockchain-based cryptocurrencies usually charge transaction fees based on the size of transaction record in kilobytes. It is impossible to predict the fee as the buyer’s wallet compiles the payment “on the fly” from a number of outputs of previous transactions which varies from wallet to wallet. If GRAFT only “flipped” the fees burden from buyers to merchants but kept the same common cryptocurrency approach to fee calculation, it wouldn’t work for merchants. So GRAFT made the fees predictable, dependant on transaction amount just like payment card brands. The authorization cost of a GRAFT Network transaction (paid to the supernodes supporting the network) is 0.5% of the transaction amount while the settlement (paid to the miners) is a fixed fee of 0.1 GRFT (more details about GRAFT fee structure can be found here). This helps bring predictability, and thus stability to the process, making accepting crypto payments more attractive to the merchants.

Similarity #3 – Special transaction types.

When we go deeper into the specifics of retail – especially the hospitality and gas station business – there are more exotic features of payment systems, and many people, including developers of other cryptocurrencies, have not developed around their existence, leaving big holes for cryptocurrency use in these areas. Most of us, however, are familiar with features such as pre-authorizations from our day to day life as consumers. Payment card brands developed these features because they were vital for many businesses to replace cash payments. Cryptocurrency designers, however, have underestimated the importance of brick-and-mortar business requirements because they focused mostly on online payments.

When you swipe your card at gas station to fill your car’s gas tank, your card is not charged immediately, but instead it is preauthorized for a particular amount set by the merchant or its payment processor; for example, $50. Preauthorization (aka “pre-auth”) ensures that your account has enough money to pay for the gas, up to $50, but it does not charge your account. Technically, you still have the $50, but temporarily you cannot spend it because pre-auth decrements your spending limit. It’s done this way because the pump does not know in advance how much gas will enter your tank (and how much you will have to pay for it). Once you’re finished fueling, the pump sends the exact amount to the network and finalizes the transaction. This operation is called completion because it actually completes the transaction. Completion unlocks the funds previously locked by pre-auth and charges your account for the exact amount. So if you owe the pump $25 for the gas, it will cancel your $50 hold and debit your bank account balance by $25 (or increase your available credit in the case of a credit card).

“Pre-auth”/”complete” mechanisms are also applicable in other big industries such as hospitality – when you check in to the hotel your card is pre-authorized for the approximated cost of your entire stay plus some additional amount for unexpected expenses. When you check out, your room your card is “completed” for the exact amount including your mini-bar charges. It sounds simple but there is a whole infrastructure behind the scenes supporting this. All existing cryptocurrencies lack “pre-auth/complete” functionality and therefore cannot be used as a method of payment at gas stations, hotels, and many other businesses. GRAFT fills this gap and provides a “pre-auth/complete” mechanism similar to plastic cards – thanks to the supernode infrastructure.

Similarity #4 – Real Time Authorizations

Finally, let’s talk about the most important feature provided by payment cards (this could very well have been listed at #1 but it’s important to emphasize the previous three as they are big challenges for the cryptocurrency paradigm that should not be overlooked). Payment cards work remarkably fast when it comes to authorization and preauthorization. Typically it takes a fraction of second (up to several seconds if their processor is slow) to get authorization or pre-authorization from Visa or most other card processing networks. It takes from several minutes to several hours to confirm payment with most cryptocurrencies. Bitcoin itself was designed for online transfers of funds where authorization time is not a critical factor. Bitcoin is more like a bank ACH transfer than a credit card payment. Most cryptocurrencies have followed Bitcoin’s design and inherited this “feature”. In the reality of brick-and-mortar stores, however, time is money, literally, as for these merchants more time spent on every payment means less customers (less revenue) and more cashiers (more expenses).

GRAFT Network processes instant authorizations and preauthorizations using special technology called Real Time Authorizations (RTA) which is accomplished through GRAFT’s decentralized supernode topology. Therefore, payments processed through the GRAFT Network are suitable for brick-and-mortar merchants.

This part is concluded now; in the next post, which will be published tomorrow, we will discuss key differences between GRAFT and plastic card networks. After all, there must be something fundamentally different in the way GRAFT processes payments, otherwise, why would anyone forget good old plastic card and rush to pay with crypto via GRAFT Network?

RTA Public Alpha Release

GRAFT Development Status Update November 12, 2018

Today is a very big day for GRAFT project – we’re releasing the new baby into the world!

The RTA Supernode is a linchpin of the GRAFT project, allowing the real-time transaction authorizations. To get to this point it took a lot of work engineering reliable transport protocol, supernode sample selection, all in a maintainable and modular way.

With the RTA Public alpha release, we’re opening the testing up to the wider public to further test and optimize its performance and reliability.

How to participate in RTA Public Alpha

  • Follow these instructions to install the RTA supernode
  • Submit this form to request the alphanet supernode PoS stake.
  • Join the RTA Alpha Telegram group to get more info about the testing process and share your findings and ideas with the community and developers.

What kinds of goals is RTA public alpha pursuing?

There are several goals for the RTA Public Alpha testing stage:

  • Find potential issues and bugs that cannot be found on a low scale network of closed alpha (about 50 participants/supernodes)
  • Allow supernode owners to get familiar with the supernode setup and maintenance processes so they will be fully prepared for the RTA Beta launch on the mainnet
  • Allow the supernode owners to estimate the earnings on the real network (the stimulus transactions will be running on public alphanet on the same or similar scale as they will be available on the mainnet after the Beta launch)
  • Most importantly, work on preparing the network for the mainnet launch by allowing community to discover any security holes and potential exploits
The RTA alpha is time to find vulnerabilities in the design, from both scaling and exploits point of view. We expect the RTA alpha testers to contribute to pushing the network’s scalability limits as well as security and usability. To that end we’re working on a bug bounty reward program that will be announced shortly.

What to expect?

  • November 12 – the RTA SN instructions are available to the community to build their RTA supernodes, configure them and connect to the Alphanet (RTA Alpha testnet)
  • November 14 – Transaction simulator availability – a special bot that will generate regular test transactions in the system
  • November 15 – Alphanet hard fork to enable the latest release of RTA supernodes and client apps; Wallet/POS RTA-compatible clients updates available via Apple app store
  • November 26Stimulus Tx package testing…

How long with the RTA public alpha last?

We don’t know what kind of things are going to get uncovered during the course of the public alpha, so it’s hard to put a date on the Mainnet beta release. 8 weeks is a good case scenario, but at this point it’s a rough target.

How to report bugs / suggestions?

Please funnel the bug reports and suggestions through our community dev liason – Jason R @jagerman..

Happy GRAFTing!

GRAFT “Anti-ASIC” Major Network Update 1.5 on October 31, 2018

Last Updated: October 25, 2018

GRAFT developers just released a new version of GRAFT software for the upcoming major network update that will introduce a new variation of the PoW hash algorithm which prevents ASIC mining. Network hashrate is important, but it is not the only factor in blockchain security. The way this hash power is distributed between the miners is also important. ASICs break the balance and facilitate centralization (concentration of hash power) which can be dangerous for the network.

The major network update will apply a new variation of CryptoNight hash algorithm (CryptoNight V8 / CN variant 2) which is currently ASIC-resistant. The source code of the new version 1.5.1 can be downloaded from master. The Linux (both Ubuntu 16.04 and 18.04) and Windows binaries are available for download from github.

The major network update (aka hard fork) in GRAFT mainnet is scheduled for Wednesday, October 31st at block 207,700 (block 194,130 in GRAFT testnet tomorrow, October 24, 2018).

The major network update means that if you are running the GRAFT network node (graftnoded) you must upgrade to the latest software before October 31st. If you do not upgrade your node before October 31st, it will be disconnected from the mainnet. Note that users of GRAFT mobile and desktop wallets are not affected by the hard fork and should not do anything – as long as they are still connected to the default proxy supernodes (if you are connected to your own supernode, do not forget to upgrade the underlying network node).