Conflux, a distributed ledger technology (DLT) project that started as a research organization focused on solving the scalability issues of Bitcoin in 2018, has now gotten the backing of the Shanghai government. Both parties will collaboratively launch a blockchain research institute by the end of December, with an incubation center slated to go live in June 2020. The alliance will also enable Conflux to develop decentralized applications (dApps) for the Chinese government.
Conflux has also stated that it is going to utilize the newly raised fund in raising a ten-person development team and take things forward from there. Their roadmap includes the launch of a testing environment in February 2019, which is to be followed by the official release of a new public blockchain sometime during Q3 2019.
So how does Conflux plan on resolving Bitcoin’s speed issue?
For starters, the limitation of Bitcoin’s underlying ledger is that it can add only one block at a time to the chain. While blockchain developers have done their bit to get around this issue with innovative tweaks, there is no foolproof permanent solution to this issue. Adding multiple blocks simultaneously to the blockchain could cause it to fork, creating two different chains.
Conflux claims to have a solution to this problem. According to the nonprofit, its researchers have figured a way which could allow one to work on blocks simultaneously and add them to the chain in one action. While details are still sketchy, the research team is convinced that not only does this method prevent a hard fork, but it also doesn’t lead to any compromise to the decentralized method of consensus (hence it’s impossible for any single party to assume full control over the blockchain).
China Pumps Millions into Conflux
Following China’s renewed interest in blockchain technology, Conflux has become one of the first public distributed ledger technology (DLT) projects to get the complete backing of the Chinese government.
Per sources close to the matter, authorities in Shanghai, China’s biggest city and global financial hub, have agreed to pump in millions of dollars into Conflux, and work with the latter to launch a blockchain research institute by the end of this year, plus an incubation center later in June 2020.
Notably, the team has made it clear that the funding will enable it to expand its ecosystem and attract more blockchain developers as well as entrepreneurs that would build highly functional decentralized applications (dApps) on its public permissionless DLT network.
Decentralizing the Chinese DLT Ecosystem
While authorities in China have exhibited a somewhat draconian stance towards crypto-linked businesses in recent times, and have not hidden its intentions to maintain the monopoly of its blockchain industry by building its digital currency named DCEP on a private blockchain, Conflux says its plans to change the narrative.
The firm has made it clear that its blockchain network will reach consensus via a proof-of-work (PoW) algorithm just like Bitcoin (BTC), however, it will have its own ecosystem and focus on eliminating the scalability issues associated with other networks.
What’s more, Conflux says the proposed blockchain startup incubation center will connect credible projects to the right venture capital firms, while also helping the Shanghai government to develop dApps that will help in enhancing its processes.
Commenting on the exciting development, Christian Oertel, reiterated that:
“Our dApps infrastructure is quite different from other blockchains. We can create dApps to enable the government to track funds and documents to fix some of the challenges it currently faces in the process.”
While Conflux reportedly sold its CFX native altcoin to a select group of investors via a private token sale, the project has made it clear that will launch its mainnet in Q1 2020 and it has no plans to organize an initial coin offering (ICO) to make its token available to the masses.
However, CFX token holders will be able to trade their assets on exchanges such as Binance.
Earlier in November, Chinese authorities launched a massive raid on Bitcoin trading venues within its shores, shutting down 173 exchanges in the process.
Conflux has made it clear that it intends to remain a nonprofit foundation. The investors backing the project have stakes in the firm in addition to access to a digital token whose value could appreciate in the future.