Analyzing the characteristics of the basic infrastructure RPC and Pocket Network in blockchain

In order to understand Pocket Network, we must first understand what RPC API is in blockchain infrastructure. When we press the confirm transaction button on our wallet, what happens behind the scenes, and how many people are helping us complete the transaction?

Infrastructure of Blockchain: Full Nodes

We all know that in the blockchain, full nodes record all transaction messages, including the content of smart contract functions. Whenever a transaction that needs to interact with the chain occurs, a full node is required.

For example, when someone exchanges a token using Uniswap and sends the transaction, Metamask will send the transaction content to a "transaction pool" in a full node via RPC, waiting to be packaged by miners. Even if a user just wants to read information from the chain, they still need to communicate with a full node. The same goes for the operation of smart contracts; most project development teams of DApps also need to communicate with full nodes.

You will find that interacting with the chain requires the assistance of a full node. However, due to cost or technical issues, most users and development teams do not run a full node themselves. Therefore, in most cases, pre-set and open full nodes are used. When setting up a network in our wallet, the RPC URL is the network location of the full node.

What is RPC? RPC stands for Remote Procedure Call, which specifies how to remotely control the function libraries in the full node of the other party. A more primitive code implementation of the RPC protocol is the JSON-RPC API, which uses JSON format to communicate with the full node. However, because the JSON-RPC API is not user-friendly enough, newer APIs such as Web3.js and ether.js have emerged, which essentially repackage the JSON-RPC API with additional features. Note: Implementation means to code the functions specified in the protocol, where the protocol is a specification document and the implementation is the code.

For example, transfer functions or balance inquiry functions are in the ledger of the full node. Therefore, Metamask or DApps use APIs like Web3.js or ether.js to communicate with open full nodes, submitting transaction information to the full node. Therefore, open full nodes are also called RPC nodes, available for remote connections, and these APIs are called RPC APIs.

API Integration Solution Providers

Understanding RPC API, let's take a look at some well-known open full nodes. There are many free open full nodes available online, but the speed and stability may vary depending on the provider. The most well-known full node is Infura, which provides stable full nodes and RPC API integration services for project development teams. Infura focuses on stable API services, which can improve the stability of DApps. Others, such as Flux or Pocket Network, also provide similar services. This should help understand the position of Pocket Network in the industry, as an API integration solution provider.

Supplement: Free API integration solution providers allow ordinary users to apply for a dedicated or public endpoint when setting up networks. These RPC URLs are provided by third parties.
Why not just use Infura? If most DApps and users connect to the same full node to communicate with the chain, there is a risk of a single point of failure. In the past, there have been incidents where Infura failures caused most DApps to crash. Therefore, there are more and more teams launching API integration solutions to communicate with the chain in a more secure and decentralized manner. Pocket Network is one of them.

Pocket Network

Introduction

What makes Pocket Network special is that it uses Cosmos's Tendermint module to build its own blockchain as an application chain, rather than achieving it at the level of smart contracts. It meets the needs of different chains from the bottom layer and maintains more flexible functions, providing a trustless API layer, which is a less common approach in the industry. Pocket Network has also issued its native cryptocurrency, POKT.

The economic model of POKT involves attracting potential node operators to set up Pocket Network full nodes using POKT, then requiring these full nodes to run specific blockchain full node programs, which could be for Ethereum, BSC, Harmony, depending on which blockchain security the user wants to provide, and stake a certain amount of POKT. When a user communicates with this full node, the full node can receive POKT token rewards, the amount of which depends on how many transactions or access attempts the full node has handled.

The full nodes representing Pocket Network are decentralized and permissionless on various networks, making it a more decentralized choice compared to Infura, reducing the risk of a single point of failure. Additionally, because POKT rewards are recorded on the Pocket Network blockchain, fund utilization is relatively more transparent. Infura is a provider, while Pocket Network is a decentralized protocol.

The relationship between Infura and Pocket Network is more like a cooperation rather than competition, as Pocket Network is an open protocol that can strengthen Infura's node services in certain regions or explore more possibilities for collaboration through modularity.

Currently, Pocket Network supports networks such as Ethereum, BSC, Solana, Avalanche, Harmony, Polygon, Algorand, and other blockchains. In the future, Pocket Network will undergo a major upgrade, as the current mechanism built using Tendermint does not meet the demand for accommodating more nodes. Therefore, the team has decided to build a new blockchain from scratch using a consensus mechanism, referred to as v1.0, which is expected to have four main modules and support over ten thousand network nodes.

Economic Model

In terms of supply, the supply of POKT will be determined by the DAO and has no upper limit. The roadmap plans to use burnt POKT staked by project development teams to balance and achieve a soft cap in the future, but this is still at the planning stage, and its feasibility remains to be seen. According to the official website, the inflation rate in April 2022 is still at 80%, which belongs to the rapid supply phase.

On the demand side, it varies according to the development stage. In the current growth phase of Pocket Network, project development teams can access full node information stably by staking a certain amount of POKT, meaning the more usage, the closer the cost is to zero compared to Infura's monthly fee of $50. However, the cost is that the staked POKT will be diluted in value over time as more POKT is distributed to node operators.

When Pocket Network enters the Maturity Phase, it will start charging project development teams POKT to burn and reduce circulation, meaning project development teams will need to regularly replenish staked POKT to maintain services, increasing the demand for POKT.

For node operators, once the stake reaches a fixed threshold, they can receive POKT rewards, encouraging node operators to distribute a large amount of POKT to different nodes, increasing network decentralization and promoting security.

Conclusion

We look forward to more innovations in infrastructure in the future. For the API integration solution provider industry, perhaps addressing MEV issues could be a more powerful killer application. Readers can pay more attention to this aspect in the market.

Solve Web3.0 world problems in a Web3.0 way. Pocket Network considers the interests of both project development teams and node operators through its unique economic model, aiming to create a sustainable and secure infrastructure for future on-chain applications. We look forward to seeing more teams contribute to making the blockchain ecosystem more robust in the future.