Today, with the rapid development of blockchain technology, Conflux Network is undoubtedly a dazzling star in China's blockchain industry. As China’s only regulatory-compliant public blockchain, Conflux is known as the “Chinese Ethereum” and, in recent technological innovations, has surpassed Ethereum to integrate Bitcoin into its ecosystem. This article will delve into Conflux’s background, technical features, and the importance of its native token, CFX.
Introduction to Conflux Networks
Conflux is a permissionless blockchain that mixes Proof of Work (PoW) and Proof of Stake (PoS). Initially, Conflux used a PoW consensus mechanism, but received a major upgrade in 2022 with the launch of the Hydra upgrade, which introduced a PoS component to the network. This change not only improves the security of the network, but also provides CFX token holders with the opportunity to stake, allowing them to earn rewards for staking their tokens.
The core advantages of the Hydra upgrade: The Hydra upgrade introduces the concept of "space" to the Conflux network, which mainly includes Core Space and eSpace. Core Space represents the original Conflux network, while eSpace is a fully EVM-compatible subchain that allows developers to easily deploy Ethereum projects at low cost. This structure enables different projects to transfer assets on the same distributed ledger, greatly improving the interoperability of the ecosystem.
Conflux’s Bitcoin L2 solution
In January 2024, Conflux launched an EVM-compatible Bitcoin Layer 2 (L2) solution. This solution not only supports Bitcoin staking, but also promotes the development of decentralized finance (DeFi) and GameFi applications. With seamless asset transfers, users can easily switch assets between Conflux and Bitcoin, further promoting cryptocurrency usage scenarios.
Advantages of the L2 solution: Conflux’s L2 solution has built-in BTC staking functionality, allowing users to contribute to the security of the Conflux platform. The introduction of the PoS consensus mechanism makes it possible to support ordinary protocols and inscription protocols, thus promoting the diversity of asset creation. This innovation not only enhances user participation, but also injects new vitality into Conflux’s ecosystem.
CFX Token Functionality and Economics
CFX is the native token of the Conflux network, and users can use CFX to pay mining fees and storage fees. Additionally, CFX supports the maintenance of the network through staking and mining rewards. According to the annual inflation report for August 2023, miners receive 1 CFX per block, while PoS stakers are rewarded at an annualized interest rate of 0.04%.
Staking and governance rights: Users who stake CFX will not only receive rewards, but will also have voting rights in network governance. The longer the staking period, the more voting rights the user receives, up to a maximum of one vote. Although users can extend the lock-in period of the pledge, they cannot reduce the pledge or withdraw coins during the pledge period. This mechanism effectively guarantees the security and stability of the network.
Conflux wallet choice
CFX can be stored in a variety of cryptocurrency wallets, including Fluent, MetaMask, and Ledger. Fluent is the Conflux Network’s native Web3 wallet designed for storing CFX and ERC-20 tokens and supports interaction with DApps. MetaMask is a popular hot wallet that mainly supports eSpace assets. Ledger, as a secure hardware wallet, can store CFX assets in Core and eSpace.
Conflux’s technical advantages: The uniqueness of the Conflux network lies in its combination of tree graph structure and Greedy Adaptive Subtree (GHAST) consensus mechanism. This innovative design enables Conflux to process multiple blocks in parallel, significantly improving throughput far beyond traditional linear structures such as Bitcoin and Ethereum.
GHAST consensus mechanism
The GHAST consensus algorithm is maintained through a decentralized node structure. As the number of nodes increases, the scalability of the network also increases. There are three types of nodes on the Conflux network: full nodes, archive nodes, and light nodes. Full nodes are typically used for PoW mining and PoS staking, archive nodes are used for RPC services, and light nodes can be used as wallets.
in conclusion
Conflux Network is rapidly emerging as an important player in the blockchain industry with its unique technical advantages and compliance. By launching an EVM-compatible Bitcoin L2 solution, Conflux not only improves the interoperability of the ecosystem, but also provides users with more opportunities to participate. As the native token of the network, CFX’s staking mechanism and governance rights bring a higher sense of participation and profit potential to users.
As the Conflux ecosystem continues to develop, it will surely occupy a place in the blockchain field in the future. Conflux is a project worth paying attention to, both for investors and developers.