Harmony is a Layer 1 smart contract platform that’s more scalable, secure, and can process transactions faster than other popular blockchains.

Harmony uses a technology called sharding, which splits the validator network into shards so that each shard can process different transactions at the same time.

In Harmony’s case, it also splits its blockchain state so that each shard only needs to store info on 1/N of the global state, where N is the number of shards.

The random way Harmony shards its network, coupled with its own consensus algorithm, ensures that Harmony’s transactions remain secure and decentralized.

Sharding the blockchain state also lowers the computing barrier for nodes. Finally, the ability to just add more shards down the road makes Harmony a fully scalable blockchain network.

Harmony is the first major blockchain to use sharding with a proof-of-stake (PoS) consensus algorithm.

It currently uses four shards that can accommodate up to 1,000 nodes and process up to 4,000 transactions with a 2-second (or so) transaction finality.

How does Harmony work?

Finalizing a block begins with assigning transactions and validators to different shards. Harmony uses its own distributed randomness generation (DRG) protocol to randomly assign validators to shards every epoch (~ 1 day).

The right to propose blocks is determined by the Effective Proof-of-Stake (EPoS) mechanism. EPoS considers the amount validators stake each epoch, but block rewards are based on the median staked by all validators.

This discourages an over-concentration of tokens with any one node or group of nodes, prevents single-shard attacks, and allows for thousands of validators across shards.

Consensus is achieved using the Fast Byzantine Fault Tolerant (FBFT) consensus protocol. A round of FBFT has three phases, starting with the (1) announce phase where the EPoS-elected leader proposes a new block and broadcasts the block to all validators in the shard.

Validators verify the message and sign on the block hash with their signature on the (2) prepare phase. When more than 2/3 of voters have submitted their signatures, the leader will compile the votes into one aggregate signature and send it back to the validators to start the (3) commit phase.

When more than 2/3 of voters have verified the proposed block, the leader compiles the bitmap and aggregates signatures, and broadcasts the block so that validators can commit the same info.

Unlike Practical Byzantine Fault Tolerance (PBFT), FBFT validators don’t need to communicate their votes to all the other validators to reach a consensus.

Instead, block leaders use the Boneh–Lynn–Shacham (BLS) multi-signature process so that validators only need to receive and commit one aggregate signature. This process helps validators reach a consensus within 2 seconds.

Aside from building its own chain, Harmony is also building bridges so that it can operate and scale dApps on other blockchains like Ethereum, Binance, Terra, Polkadot, Bitcoin, and many others.

Team background

Harmony was founded by Google Senior Infrastructure Engineer and Apple Search Ranking Engineer Stephen Tse in 2017.

He and his co-founders Rongjian Lan, Sahil Dewan, and Leo Chen got together with other FAANG bros and successfully launched an initial exchange offering (IEO) on Binance Launchpad in 2019.

Tse remains CEO of Harmony while Lan is CTO and Dewan is Chief Product Officer (CPO).

What is the ONE token?

Harmony’s token, ONE, is derived from the platform’s vision “For One and For All.”

ONE is an HRC-20 token that follows Harmony’s token governance. ONE was launched via the Binance Launchpad and, like a lot of HRC-20 tokens, is native to the Binance Smart Chain.

The smallest unit of ONE is called Atto, which is 0.000000000000000001 ONE and is equivalent to Wei in Ethereum.

ONE owners can stake a minimum of 10,000 ONEs to run a validator note or stake 100 ONEs to delegate to a validator. They’ll receive a portion of the transaction fees that are also paid in ONE tokens. Finally, owners can use their ONEs to participate in the governance process.

Token Metrics:

  • Circulating supply: 12.67B ONE
  • Annual reward  supply will remain at 441M per year regardless of block time and staking ratio
  • Transaction fees are paid in ONE, which is then burned. As adoption grows, this mechanism should offset the yearly 441M ONE issuance