The Factom Protocol Aims to Extend Bitcoin 2.0 Technology's Usage to Traditional Spheres

Factom, a recently announced decentralized protocol aiming to solve the Bitcoin blockchain's problems of speed, cost and bloat, releases API and white paper.

The lead developers of Factom, a new protocol built upon the Bitcoin blockchain, announced on November 17, the release of its white paper and API, according to an official announcement.

The founders of Factom conducted an AMA (Ask Me Anything) session on /r/Bitcoin on the same day, at 2 p.m. (EST), where they discussed the white paper details and answered the community's questions.

“Stretching far beyond the realm of digital currency”

Announced earlier this month, Factom aims to create a faster, cheaper, bloat-free way to develop blockchain-based applications. According to the white paper:

"When Satoshi Nakamoto launched the Bitcoin blockchain he revolutionized the way transactions were recorded. There had never before existed a permanent, decentralized, and trustless ledger of records. Developers have rushed to create applications built on top of this ledger. Unfortunately, they have been running into a few core constraints intrinsic to the original design tradeoffs of Bitcoin."

These constraints, reads the paper, are speed, cost, and bloat. It continued:

"Factom is a protocol designed to address these three core constraints. Factom creates a protocol for applications that provide functions and features beyond currency transactions. Factom constructs a standard, effective, and secure foundation for these applications to run faster, cheaper and without bloating Bitcoin."

Factom's simple extension of the Bitcoin blockchain, allows users to run their own personal, provably immutable ledgers. Users and applications, also have the ability to define which information is stored in the ledgers. "Foactom lets you use the blockchain without forcing you to use the currency," explained Factorm's CEO and core developer Paul Snow, who continued:

"Factom opens the door to transparent and secure audits of all business processes, not just financial ones. Users of Factom can leverage the blockchain for projects in title records, the Internet of Things, security, medical records, banking services and more. And users can do this without using Bitcoin or any other digital token. "

Factom's numerous initiatives aim to help establish the technology as the true standard bearer of Bitcoin 2.0, and the developers are expecting to see new and innovative ways in which the protocol can be applied. This technological breakthrough is said to have to the potential to reach beyond the realm of digital currency, to more traditional spheres such as business and law.

AMA session sum-up

In their AMA session, the founders of Factom, Paul Snow, Peter Kirby, and David Johnston, answered the community's questions regarding Factom's freshly released white paper and API. Here are a few topics and questions that stood out:

shannoncode: "Do you guys see Factom as an alternative to sidechains, not related, or complementary?"

Peter Kirby (petermkirby): "Definitely complementary! Sidechains is really cool technology that lets the blockchain do much more interesting things with currencies and value exchange.

Factom is more about record keeping and data. When Sidechains gets implemented, we'll have to write some special code to accommodate them. Sidechains is a special case of the broad things that can be done with the blockchain."

The sidechains technology was introduced earlier this year, and aims to increase Bitcoin functionality by allowing off-blockchain 'add-ons.' While trying to achieve the same goals, Factom and sidechains are using different mechanisms.

cryptomarketstech: "Can you describe a bit how you are going to solve bloat/scalability issues... Given you want to use the blockchain for new things (beyond bitcoin payments etc.)."

Paul Snow (alanX): "Factom actually keeps the information off blockchain, using its own structures, and distributes them over the systems running Factom nodes. It is a separate P2P network, much like Bitcoin's. All the entries we receive over 10 minutes are combined via a Merkle Tree to place the single hash (the Merkle root) into the blockchain. In that wa