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Jan 8 2018

The Power of SKY; The Defense of Freedom (V1.0.3) (Author: Mao 驴占坑)


Premise: Computer = Calculation + Storage + Network.

On the most basic level, a computer is anything that processes data. It can be a physical device, like a PC, or an abstract, virtual system involved in information processing. Every computer consists of three elements: a CPU, a hard disk, and a network card.

All computer hardware, virtualization, and computer languages include these elements, which allow computers to process data sets. However, decentralized systems pose different challenges for information processing. When data is not centralized in any one location, it can become inconsistent. Decentralized networks have the added challenge of maintaining data consistency during processing.

There are several technologies that address data consistency and storage in decentralized networks. All of these technologies have issues, as we’ll see below

  • ETH specializes in calculation with swarm technology, and can be utilized for storage. It does not include network routing. ETH protocol has its own local memory, but has a small storage capacity. Furthermore, its memory usage is high.

  • MAID focuses on storage. Its calculation is done by clients, and it has no network routing. MAID’s storage is more powerful than that provided by swarm. Swarm is a pre-image which cannot be modified once deployed. Though IPFS has raised $400 million, its storage technology is similar to ETH swarm.

  • Tor Dark Web and I2P Deep Web are overlay network routing protocols that are unaffiliated with cryptocurrency. Their technology is rapidly becoming obsolete, and both have poor performance.

  • Two general algorithms, Proof of Work (PoW) and Proof of Stake (PoS), are utilized to maintain the consistency of decentralized data. Both result in centralizing tendencies and can result in inconsistency.

Skycoin Comparison:

Calculation: CX scripting language (similar to solidity, but not limited to smart contracts)

Storage: CXO (Similar to swarm/IPFS, but has schema and is able to save structured data)

Network: Skywire network routing protocols (similar to I2P, but more flexible, more powerful, and automatic)

Consistency: Obelisk consistency protocol (completely different from PoW and PoS; it realizes resource inversion control)

a. SKY provides a powerful network that exists as a layer on top of the internet. The SKY network is protected by the Obelisk consistency protocol and has its own routing. Like the Dark Web and TOR, SKY is resistant to censorship and features robust network privacy. However, the SKY network is most similar to the I2P network.

Within the SKY network, once you cross the firewall, your anonymity is preserved and your activity cannot be blocked in any way. As long as one node in the overlay network can cross the firewall and reach foreign websites, the other nodes can as well. Nodes can connect to foreign networks via routing. The node could be a satellite, your own private line, or your own high-powered radio. Although this setup may seem superficially similar to BitTorrent, the two systems are quite different. SKY’s network is an abstractive presentation of your telecommunication network, while BT is just an application on the upper level. While you can use BT for downloading, you can’t use BT to chat in QQ. By contrast, ETH and MAID lack a network module. If you want to be anonymous and avoid network analysis, TOR is the only option. TOR is known to have many phishing nodes, and there is no way to avoid them.

c. In terms of storage, Skycoin features CXO, which is similar to swarm/IPFS but more powerful. CXO is better than swarm because has a schema, which can be understood as a set of constraints that categorize relational databases. CXO can also be modified. By contrast, MAID’s storage is a key-value system (KVS). Its strength is in its built-in privacy encryption protection. In terms of data access, KVS is a very low-level tool that must be applied towards building upper levels.

d. Skycoin’s Calculation: CX is a specialized scripting language that can operate on virtual machines on clients. CX can support two types of chain calculation. The first type is like Ethernet, where miners help you calculate and put results into the system. The second type is like MAID, where the user both calculates and puts results into the system.

e. Resources are required to prevent a sybil attack and maintain data consistency on an open network. Both PoW and PoS can control data consistency as long as they have resources. Agents who secure the network gain resources. In PoW, the agent who wields a higher hash rate will take control, while in PoS, the agent with more coins staked will prevail. These agents can initiate an attack once they accumulate 51% of network resources.

Skycoin consensus is completely different from PoW or PoS. Skycoin’s consensus mechanism realizes resource inversion. It works based on a web-of-trust system. The “resource” on Skycoin is trust. The more others trust you, the more resources you have. Resources are not provided by the securing agents themselves. If you misuse the network, people will lose trust in you, and your resources will be reduced. As a result, network abuse is self-limiting. Abusing the network will reduce your resources, thereby diminishing your capacity for network abuse.


Skycoin provides a brand-new consensus mechanism for managing the three elements of decentralized computing: computing + storage + network. It brings us a new consensus mechanism that can be used for a world computer.

The network, storage and calculation capabilities of Skycoin are extremely powerful. Skycoin is the first project to apply resource inversion in its blockchain consensus mechanism. The foundational idea behind Skycoin is that of freedom: Free coins, network, storage, computing, and consensus. No one can take your coins, block your network, or delete your data. No one can shut down your server, or dominate consensus. The SKY network is just what it sounds like: an open sky, where users can fly free.

This article was originally written in Chinese by Mao 驴占坑, a community supporter. This article has been translated into English for your perusal.