What is Harmony (ONE) blockchain and why it is getting so much traction?
What is Harmony(ONE) crypto?
Harmony (ONE) is a blockchain-based platform that aims to address the conundrum of achieving both scalability and decentralization without sacrificing either.
Harmony (ONE) was launched as part of the Binance Launchpad's initial exchange offering (IEO) in May 2019. It is aimed to be a bridge between scalability and decentralization efforts. It was built with the motto "decentralization at scale" in mind, emphasizing data sharing and the construction of fungible token and nonfungible asset marketplaces.
Furthermore, Harmony promises to give high throughput with two "lows": latency and costs. They're expected to put the platform at the center of efforts to establish the groundwork for future decentralized trustless economies when they're combined.
Harmony began as a company in 2018 before the IEO. But, who is behind Harmony (ONE)? Multiple investors, including Silicon Valley's Consensus Capital, Hong Kong's Lemniscap VC, and others, were interested in its fundraising endeavor, which raised $18 million in April 2019. Investors bought almost $2.8 billion of the company's ONE tokens, with $12.6 billion put aside for pre-mining.
Harmony gives investors access to an ecosystem that will enable the company's adoption across a variety of businesses, with a focus on data sharing, decentralized marketplaces, supply chain monitoring, ad exchanges, credit rating systems and gaming.
What is ONE?
The ONE token is utilized as a stake in the Harmony consensus model. Holders can earn block rewards and be rewarded for keeping the system running smoothly.
Harmony, like many other layer 2 (L2) platforms, has its community token, Harmony ONE, which stresses the protocol's objective of assisting open consensus procedures for billions of individuals throughout the world.
The Harmony ONE token is used to pay for all platform activities and amenities, including voting, transaction fees, gas fees, staking and earning rewards.
The Harmony ONE token had a dynamic inflation schedule up until March 2020. Later, the rate of inflation was changed to a fixed annual rate.
How does Harmony ONE work?
Through the use of random state sharding, Harmony improves scalability and speeds up transaction and block generation.
Random state sharding allows the network to divide the database into smaller segments called shards to reduce latency. In addition, sharding allows for near-instantaneous transactions while avoiding network congestion.
The sharding technique is based on a distributed randomness generation procedure that uses an adaptive proof-of-stake (PoS) consensus mechanism. Security, scalability and simple and easy verification are all possible with this combination.
Fast Byzantine Fault Tolerance protocol (FBFT) is a variant of the BFT protocol used by the Harmony network. FBFT improves the Harmony network's speed and efficiency by processing transactions in parallel. Simultaneously, Harmony minimizes communication costs by signing transactions using an aggregate signature, allowing 250 or more validators to reach a consensus in less than two seconds.
What network does Harmony ONE use?
Harmony is an open and fast blockchain, featuring a mainnet that runs on an Ethereum network with 2-second transaction finality and 1000 times lower fees than Ethereum.
Harmony (ONE) blockchain is an L2 blockchain platform built on the Ethereum network, making it easier for developers to create decentralized apps (DApps).
Because of Ethereum's high gas fees, more altcoins are developing scaling solutions in an attempt to dethrone Ethereum as the most popular network for developing DApps. Unlike many other platforms in this category, Harmony collaborates with Ethereum rather than competing with it.
How to buy Harmony ONE?
Harmony can be purchased most easily through a cryptocurrency exchange; however, the Coinbase app and Coinbase wallet do not allow Harmony ONE coin trading.
Steps to buying Harmony ONE are listed below:
- Compare ONE-supporting cryptocurrency exchanges: Fees, security and payment methods vary among cryptocurrency exchanges, so you'll need to do some research to figure out which is the best fit for you. You don't need a wide selection of features being a beginner, and you can always change exchanges later.
- Create a trading account on a platform: Visit the website of the exchange where you want to create an account. Click on “sign up,” which will lead you to the account creation page, where you can fill out your personal information, beginning with your name, email address, and submit a proof of address, etc.
- Deposit funds into your account: To purchase Harmony, fund your account using a bank transfer, credit or debit card, or Bitcoin from a crypto wallet.
- Buy Harmony: After that, complete your Harmony purchase by entering the amount you want to purchase and clicking “buy.”
You may also want to know how to mine harmony ONE? Surprisingly, Harmony (ONE) is not a mineable coin, which means it is not designed to replace fiat money.
What is Harmony ONE staking and how to stake Harmony ONE?
Holders of Harmony ONE can use the staking explorer to delegate their tokens to existing validators. As a delegator or a validator, you can participate in Harmony's staking.
Staking Harmony tokens to a specific network validator might be similar to a bank deposit in that you delegate (delegation means bonding with the smart contract, not real transferring in this case) your Harmony tokens to that validator to enable network decentralization, security and performance. Individuals that staked their ONE tokens are rewarded as part of this program.
Delegation is the most significant way for those who want to participate in staking but don't want to run a validator to collect block rewards. If the tokens are delegated to an elected validator, the delegator will receive a portion of the block reward obtained by the validator (according to section block reward).
The delegators earned block rewards are saved in a separate reward balance that can be withdrawn directly to the delegator's account balance. The block rewards can be staked again to get the compounding impact of staking.
Your delegated tokens are also linked to lowering the validator's risks. As a delegator, you should carefully pick validators based on past performance indicators like uptime and commission. In addition, you should split your delegations among different validators to reduce the danger of apathy or indecisiveness.
The Staking Explorer makes it simple to delegate, send payments, and view validator information, as shown in the image below:
You can browse the dashboard without using your ONE address, but your ONE address will be used for any transactions. The Harmony Chrome Extension, MathWallet Chrome Extension or Ledger Nano S can all be used to log into an account, as shown in the image below.
You can access network data, a list of validators, validator profiles and other information after logging in to assist you in deciding whom to delegate to, as shown in the image below.
A signature is required for every transaction or delegation. The Harmony Chrome Extension, which supports the Ledger Nano S, can be used.
How to choose a Harmony ONE wallet?
Google Chrome plugin, hardware, software or online wallets are various mediums to store Harmony crypto.
The Harmony ONE wallet is available as a Google Chrome plugin that is simple to install and much simpler to use. There are a plethora of third-party wallets for storing ONE, and the type you choose will likely be determined by how much you need to keep and what you plan to do with it.
Hardware wallets, also known as cold wallets, like Ledger or Trezor, are the safest way to store and backup cryptocurrency. They do, however, necessitate more technical knowledge and are a more costly option. As a result, more experienced users may be better suited to store more significant volumes of ONE.
Software wallets offer a different solution that is both free and simple to use. For example, they might be custodial or non-custodial and can be downloaded as smartphONE or desktop apps.
With custodial wallets, the service provider manages and backs up your private keys on your behalf. Non-custodial wallets hold private keys on your device using security compONEnts. While they are convenient, they are less secure than hardware wallets and may be better suited to smaller groups of ONE or more inexperienced users.
Online wallets are also free and simple to use and can be accessed from various devices using a web browser. On the other hand, hot wallets are regarded as risky and can be less secure than hardware or software alternatives.
Because you'll be entrusting the platform with your ONE, make sure it's a reliable provider with a proven track record in security and custody. As a result, they're best for people who have a modest number of cryptocurrencies or trade frequently.
Why is Harmony ONE getting so much traction?
Harmony is getting a lot of traction because it addresses core blockchain concerns, is energy-efficient, has cross-chain capabilities, offers lower gas fees and has a huge potential for nonfungible tokens (NFTs).
Maintain decentralization and security
Harmony thinks its network can scale while maintaining decentralization and security because it uses sharding, which divides validators into multiple groups and allows them to approve transactions and new blocks simultaneously. Harmony can now process 2,000 transactions per second (TPS), which is comparable to Visa, ONE of the world's largest payment networks. Harmony believes it will process 10 million TPS in the long run.
On the other hand, Harmony does not compromise security or decentralization even as it scales. For example, the network assigns nodes or computers that join the network and validate transactions, to distinct shards via a distributed randomness generation mechanism. Harmony also keeps the minimum number of ONE tokens required for nodes to join the network as validators and preserve decentralization at a low level.
Many blockchain networks are now adopting the proof-of-stake model, which Harmony has employed since its inception. As a result, nodes put up existing tokens as collateral in this procedure to have a chance to be chosen at random to validate transactions. For a block to be approved, several validators must check transactions. Harmony stands out from other networks because its architecture and proof-of-stake consensus method allow it to complete blocks in under two seconds.
Additionally, Harmony introduced Horizon, a cross-chain interoperability bridge with Ethereum, allowing assets to be exchanged between the two networks. This innovation can revolutionize cross-border payments and make cryptocurrency exchanges more convenient. Harmony has also established connections with other blockchains, such as Binance.
By allowing nodes on other blockchain networks to validate transactions, Harmony's platform can transfer data across various blockchain networks, regardless of whether they use proof-of-stake or proof-of-work governance.
Lower gas fees
Harmony's network seldom becomes clogged, thanks to its high TPS and usage of proof-of-stake validation. As a result, it does not have high gas fees, which are now a fraction of a penny per transaction on Harmony.
On the other hand, a network like Ethereum sees far more overall demand and transactions than Harmony. Still, Harmony claims that it can alleviate congestion issues by simply adding additional shards, even if the network is fully utilized and witnessing exceptionally high demand.
Huge potential for NFTs
The network's cross-chain capabilities open up some exciting possibilities for NFTs, which are secure digital art, video and audio assets that may be transmitted on a blockchain network. Moreover, cheaper gas expenses may make the network appealing to developers interested in minting NFTs.
According to Harmony, bridging NFTs from ONE network to another may be costly at first, but subsequent transactions will be inexpensive. Harmony also announced on Twitter that it is working on NFT lending, NFT verification and fractionalization, among other features.
Is Harmony ONE a good investment?
Investing is a very personal endeavor. Do your own research and try to stay on top of any advances in the Harmony ecosystem that might help it grow.
Although there is still much to be done, the Harmony project has been considered a solution to poor scaling and interoperability and a useful foundation for DApp developers to scale their apps and transactions.
Harmony aspires to be a top crypto network known for its speed and efficiency, and it's well on its way to achieving that goal. The platform delivers on its promise of low gas and transaction costs.
As with any other cryptocurrency or platform, ONE will appreciate as Harmony becomes more prevalent. Perhaps then, in addition to buying, selling and staking, we'll see other use cases of Harmony ONE in the future.