Crypto Market Cap$2,021,665,680,265-3%
Proof-of-Stake Marketcap$374,203,665,754-3.55%
Global Staked Value$263,871,750,898-4.31%
SR20$921.4325.6% MTD
Benchmark Interest Rate23.62%1.32%
Benchmark Total Staked52.13%-0.55%
Global Stakers3,943,6933.85%
Crypto GDP$337,593,364,319-0.11%
Proof-of-Stake Flippening PoW31.64%
Crypto Market Cap$2,021,665,680,265-3%
Proof-of-Stake Marketcap$374,203,665,754-3.55%
Global Staked Value$263,871,750,898-4.31%
SR20$921.4325.6% MTD
Benchmark Interest Rate23.62%1.32%
Benchmark Total Staked52.13%-0.55%
Global Stakers3,943,6933.85%
Crypto GDP$337,593,364,319-0.11%
Proof-of-Stake Flippening PoW31.64%

      Introduction

      Radix is one of those rare projects that publicly displays the strength of its technology, delivers promises on time, and whose website is so replete with information that it functions like a reverse akinator. Founded by Dan Hughes, an experienced software developer, and leader in the mobile technology industry, Radix prides itself on being the only decentralized network solving blockchain scalability issues where developers will be able to build quickly without the constant threat of exploits and hacks. XRD is the mainnet’s native token powering the Radix ecosystem. Its mission: Give anyone, anywhere, friction-free access to the digital economy.

      TL/DR

      This is a complete review of Radix, its tech, tokenomics, investment potential, etc. So navigate to the side menu on the left to find relevant section headers to dive into details on specific topics. Generally, Radix is not like other blockchains, because it’s not one. After seven years of R&D, the Radix team has built a distributed ledger consensus protocol that doesn’t have the inherent architectural constraints of blockchains. Building a unique data structure that’s more decentralized than Iota’s Tangle (a Directed Acyclic Graph or DAG) and Hedera’s Hashgraph, Radix was able to prove that its ledger’s capacity (from its old consensus algorithm, Tempo) can handle 1.4 million transactions per second (TPS) publicly.


      Aside from an impressive demonstration, its current mainnet, Olympia, can only handle 50 TPS. Its roadmap is humble, waiting till 2023 to release its final, infinitely scalable mainnet version, Xi’an, and has yet to be met with delays. As an investment, its tokenomics have the appearance of potentially being hyperinflationary with a total supply of 24 billion XRD tokens and 9 billion in circulation. In actuality, it will take over 40 years for all to be distributed. Facing competition from sharded blockchains like Polkadot, which can process over 1 million TPS theoretically, it remains to be one of the stronger distributed ledger technology (DLT) projects that’s also relatively decentralized.

      Table from Radix DeFi White paper, pg. 5.

      Radix Distributed Ledger Technology

      The Radix DLT data structure differs from the typical blockchain and DAG data structures used for building distributed ledgers. After seven years of R&D, the Radix team has built a hyper-complex protocol and product that they believe addresses the issues that blockchains and DAGs couldn’t. As per its whitepaper, it seeks to build interoperable decentralized applications (dApps) faster, incentivize a decentralized developer community, scale dApps without breaking composability, and reduce smart contract hacks, exploits, and failures.

      Radix Public Network & Radix Ledger

      All things Radix fall under the umbrella of the Radix Public Network, from the consensus algorithm to transaction verification. The network consists of the live set of computer nodes that communicate over the internet to establish whether they should verify transactions and commit them to the Radix Ledger. The validation nodes are a critical layer of the network’s security as they drive progress through the phases of consensus and verify transactions. The Radix Ledger is composed of substates, which represent changes to the state of the ledger. These substates form all of the immutable data that is sent through the network, including NFTs, the state of developer components (useful code functions), simple transactions, etc.

      Radix Protocol

      If the Radix Public Network is an umbrella, the Radix Protocol is the skeletal structure supporting the whole thing. It is the algorithmic rules that govern how validator nodes operate the Radix Public Network. It defines how nodes communicate, how they reach consensus on transactions, what makes transactions valid, and how fees, emissions, epochs, and essentially everything function on Radix. The Radix Protocol consists of the Radix Engine as its application layer, Cerberus as its consensus layer, and Radix’s Delegated PoS system as its Sybil resistance mechanism. Underpinning each important layer of the network, if any part of the skeletal structure is weak, the umbrella will invert at the slightest headwind and fail to be of any use.

      This diagram shows how substates flow through a series of developer components that essentially create dApps.

      Radix Engine

      When Radix says it wants to help developers “build quickly without the constant threat of exploits and hacks,” it intends to use Radix Engine to accomplish that. Radix Engine is essentially Radix’s safer version of the Ethereum Virtual Machine (EVM), which is computer logic that runs Etheruem smart contracts. By building on a well-constrained finite state machine to manage tokens and other assets, value-based assets on Radix are not open-ended smart contracts, and hence, more compatible with program logic that simply needs assets to behave like “physical” money. (This makes creating secure, predictable financial applications that manage millions of dollars in complex DeFi transactions much safer, though it is a bit more strict to develop on.)

      The final version of Radix Engine — like most features that make Radix attractive — has yet to be released. Currently Radix Engine v1 (REv1), on Olympia mainnet, only supports basic XRD transactions, staking/unstaking to validator nodes, registering/unregistering a validator node, querying the Radix Ledger, and creating new tokens on top of Radix’s network. The recent Alexandria release on December 15th introduced developers to a test version of REv2 and to the Scrypto (Radix’s version of Solidity) programming language, allowing devs to create component smart contracts running in a private environment for early builds and testing. Later in 2022, under the  Babylon release, REv2 will meet the mainnet with the running of on-network component smart contracts, the creation of the on-network component catalog, and the developer royalties system kicking off. As the application layer, Radix Engine will be synchronized with the Cerberus consensus layer.

      Cerberus

      Before getting to Cerberus, let’s start at the current mainnet version, Olympia. Olympia is the unsharded Cerberus with simple functionality and a humble 50 TPS capacity. Thus far, it only supports Radix Engine v1 while Cerberus will support the full functionality of Radix Engine v2 in a fully sharded form. At some point in 2023, when Radix launches its Xi’an release and Cerberus drops its 115 quattuorvigintillion (2256 or 1.15 * 1077) shards onto the mainnet, it will be the first sharded protocol to ensure that all transactions are atomically composed across shards. (Atomic composability allows transactions to contain multiple actions — like token transfers and calls to smart contracts — and seamlessly interoperate with different decentralized applications on the ledger.) Radix Labs is currently trying to figure out how Cerberus will be implemented in its fully sharded form by researching, testing, and demonstrating the various implementations via the Cassandra test network.

      To support the incredible features that Radix boasts, Cerberus approaches consensus from a unique perspective: start with a Byzantine Fault Tolerance (BFT) consensus, adapt it to run on multiple shards simultaneously (parallelization), and connect the communication lines among each instance (shard), essentially braiding communication lines to be synchronized while following the directions of Radix Engine to update independent components. This process gives Cerberus infinite linear scalability, increasing throughput linearly as more nodes are added to the Radix Public Network. For those interested in exploring Cerberus more deeply, the Cerberus whitepaper explains the complex details that make this consensus protocol function. For another perspective, the University of California Davis rigorously studied Cerberus and released an academic paper verifying the claims from the Cerberus whitepaper.

      Leadership

      Dan Hughes, Founder & CTO: As a veteran in the mobile services, telecommunications, and financial systems industries, Hughes is an accomplished developer, creator, and leader. He was one of the first to develop applications for near-field communication (NFC) technology and contactless payment services such as mobile wallets. He designed and co-built T-Mobile’s 1st mobile app platform. In addition to founding Radix, he founded and led two other companies, one for more than five years, and the other got acquired. Hughes is a proven leader and developer who employs incredible determination and intelligence when creating novel solutions for the technology space.

      Piers Ridyard, CEO: A Y Combinator Alumni, Piers joined Radix after exiting his previous company which built DLT based deal rooms for clearing syndicated insurance contracts. CEO was Ridyard’s first job title after internship. Before Radix, he led three companies as CEO for a total of six years, his first company for nearly five of those six. It is unclear whether he had the requisite leadership experience to start leading Radix back in 2017; however, under his leadership, the project has reached unicorn status with a current market cap of about $2.5 billion. Radix’s ability to execute its roadmap on time reflects on Ridyard’s leadership capabilities.

      Russel Harvey, CTO: Harvey adds over 20 years of technology industry experience — with 17 years in leadership roles – to Radix’s executive team. Delivering projects in diverse software development domains including quality assurance at Microsoft (his first post-university job), database and server management at Kaiser Permanente, machine learning, and distributed ledger technology, Harvey is an expert at shipping complex products on schedule. His five years of CTO and CEO experience before joining Radix combined with his deep technical background make him an ideal leader, alongside Dan Hughes, commanding the technical direction of Radix.

      Radix incentives for node runners and development. (Radix DeFi White paper, pg. 16.)

      Staking and Passive Income on Radix

      For Radix Developers

      Developers are highly incentivized to contribute functional and useful code to Radix’s on-ledger DeFi component library, or catalog. They will earn direct royalty fees when other projects use their components to build applications. They will also receive a royalty payment for every transaction in which their code is used. User transactions encompass direct instance and referred instance component usage while application-use encompasses catalog and imported component usage. (Radix DeFi White paper, pg. 17.) Of the four different types of component usage, developers must set a fee for each, pricing their own work. The component catalog and fee structure for reused code is a great way for developers to continually earn income from their software contributions to the Radix ecosystem.

      Staking as a Delegator

      Staking on Radix comes in the form of delegation — delegating your right to earn validation rewards on your XRD to a validator who does the work of running a node and splits the rewards with you, the delegator, by taking a fee off the top. The current staking rewards rate, or emissions rate as Radix prefers, hovers between 11–12%, competitive with many of the top crypto assets that offer staking today. You will notice most validator fees are anywhere in the range of 1–10%, where some outrageous ones charge more than 10%. The Radix protocol automatically stakes your XRD emissions on top of your staked assets, compounding your earnings and bypassing the typical process that most delegated staking mechanisms employ of requiring users to claim rewards before staking them.

      As is the case with every delegated PoS protocol, some validators are better than others. You want 100% recent uptime from every validator you delegate to. Radix partially slashes (and burns) emissions as a penalty if a validator fails to participate in consensus some of the time during the epoch, which incentivizes good, consistent behavior from validators… so choose wisely. You can stake your XRD in literally a few clicks from the Radix Desktop Wallet. You can similarly unstake assets in a few clicks too; however, you must wait for an unstaking delay time before your assets are available for use. This delay lasts for 500 epochs, which are measured as a fixed number of consensus rounds. Today, 500 epochs take roughly 10–14 days. The Radix wallet also pairs with the Ledger hardware wallet, offering users an extra layer of security when they sign transactions.

      Staking as a Validator on Radix

      Staking as a Radix validator, although achievable, is very competitive. Anyone is allowed to operate a node and register to become a validator, which requires shockingly low hardware requirements like 4 cores (CPU), 16 GB of memory, 100 GB of SSD, an Ubuntu Linux OS, and up to 10 Gbps of network bandwidth. It is also straightforward enough to set up with decent server administration experience — which is sufficiently intelligible to learn.

      The caveat, however, is that the consensus protocol selects only the top 100 registered nodes by delegated stake to participate in consensus and receive emissions rewards. The logic behind only 100 nodes is to make node-running competitive and encourage high standards of operation. At the start of a new epoch (an epoch lasts under two hours), the total amount of XRD staked to each validator node is checked and a new set of 100 validators is selected, giving aspiring validators a chance to secure the network.

      Note: Compared to a popular blockchain like Solana, becoming a Radix validator is much more achievable. For instance, compare Radix’s validator hardware requirements to Solana’s: 12 cores / 24 threads (CPU), 128 GB of memory at a minimum (256 GB RAM suggested), three separate storage units (recommended) totaling 2 TB (500 GB for accounts, 1 TB for ledger, 500 GB for OS).

      The act of staking as a validator is almost no different from staking as a delegator. Node owners continue to stake to their own node, earning emissions exactly as delegators do. The extra step for a validator comes from having to specify an “owner address” when registering their node; owners use this address to stake to their own node. This address is visible from the Radix Explorer and is also used as the account that validator fees are credited to. In addition to the normal emissions rewards, validators specify and receive a validator fee, which is a percent of total emissions earned by stakers to the node. All emissions are earned in a staked state, as described above for delegators, accumulate on top of the already staked assets, and can be claimed with the same unstaking delay as delegators.

      XRD token allocation.

      Tokenomics of Radix, XRD, & EXRD

      The Radix token, XRD, has the explicit purpose of securing the Radix Public Network by staking it as part of Radix’s Delegated Proof of Stake (DPoS) system. XRD is also the only token that is used to pay transaction fees on Radix, which are burnt. The E-Radix token, EXRD, is the Ethereum-wrapped version of the XRD token and can be swapped 1:1 on Radix’s Instabridge. (Thus far, Instabridge only supports EXRD to XRD.)

      The E-Radix token will never expire, so you never have to worry about a cutoff for swapping between EXRD and XRD. It was instantiated in November 2020 on the Ethereum network, as an ERC-20 token, under contract: 0x6468e79A80C0eaB0F9A2B574c8d5bC374Af59414. It was issued before XRD as a means of distributing tokens as widely as possible prior to delivering DPoS staking to the Radix mainnet. EXRD can be bought on a number of exchanges including Uniswap, KuCoin, and MEXC Global. XRD can only be bought on Bitfinex.

      The Radix token has a maximum supply of 24 billion XRD. The genesis of the Radix Public Network in July 2021 saw the allocation of 12 billion XRD, with 9.6 billion being unlocked and part of the circulating supply, and 2.4 billion being indefinitely locked in the stable coin reserve. (These 2.4 billion XRD will be held for up to a 10-year period and potentially dispersed to support a systemic stabilization protocol for one or several Radix native stable coins, which may or may not require the use of the Stable Coin Reserve. Should the Stable Coin Reserve not be needed, it will be destroyed after the 10-year period.) The other 12 billion XRD is being minted by the Radix Protocol as emissions rewards to validators and delegators over approximately a 40-year period. Emissions are estimated to release about 300 million XRD into circulation a year.

      The allocations of the XRD tokens that were issued at the genesis of the Radix Public Network can be found in the graphic above. Explained here are the purposes for each allocation (information on purposes is pulled from the Radix website at your convenience):

      • Token Sale (October 2020): Allocated to members of the Radix Community who purchased XRD tokens at a price of $0.039 in the October 2020 Token Sale.
      • Radix Community: Allocated to early Radix Community members who contributed approximately 3,000 BTC between 2013–2017 to Dan Hughes who initiated the theoretical development of the Radix project.
      • Liquidity Incentives: Allocated to participants of the Liquidity Mining Program that took place between November 2020 to May 2021.
      • Founder Retention: Allocated to RDX Works Ltd which has funded and developed Radix technology since 2017. RDX Works Ltd holds the tokens it retains from the instantiation of the Radix Ledger as a treasury asset of the company.
      • Radix Foundation — Radix Tokens (Jersey) Limited: Allocated to Radix Tokens (Jersey) Limited, which is a wholly-owned subsidiary of the Radix Foundation. The objectives of the Foundation are to promote the use and development of the Radix Ledger, as well as provide education and support for the Radix community and ecosystem, and operate incentive programs, events, and more.
      • Developer Incentives: Allocated to Radix Tokens (Jersey) Limited to fund grants to bootstrap the development of dApps and more on Radix.
      • Network Subsidy: Allocated to Radix Tokens (Jersey) Limited to fund grants to subsidize the Radix Public Network, such as grants provided to validator node-runners.
      • Stable Coin Reserve: (described in the above paragraph)
      • Network Emission: (described in the above paragraph)

      Radix Ecosystem

      The Radix Ecosystem / Partners

      Radix x Chainlink

      • Chainlink is the industry-leading oracle network in the digital asset space today.
      • Making DeFi oracles easy to access for developers allows them to use secure, accurate off-ledger data.
      • This helps facilitate the development of innovative DeFi products and the recreation of traditional financial services as decentralized apps.
      • The focus of the Chainlink integration will be to make its widely used price feeds available within the Radix ecosystem.
      • Working with Chainlink guarantees high-quality price data, decentralized oracles, and Sybil resistant nodes.
      • According to Radix, this integration unlocks lots of potential for Radix developers to build various DeFi applications such as financial derivatives that settle based on asset prices, decentralized lending products that use price feeds to issue fair market loans and maintain collateralization, asset management services that automate trades based on price movements, and much more.

      Ren

      • The Ren Protocol locks native assets and mints corresponding wrapped tokens on other public ledgers.
      • Using Ren is how you get EXRD (on Ethereum) from XRD (on Radix).
      • Bringing fully decentralized wrapping to Radix removes centralized counterparty risk and enables bridges to be built between other ecosystems, like Ethereum, helping to reduce fees and increase liquidity for both.

      Radix x Copper

      • Copper provides highly secure, insured, institutional crypto custody for an expanding range of digital assets.
      • It acts as a gateway for institutional investors into the crypto space, offering custody, trading, prime brokerage, and more for over 100 cryptocurrencies.
      • Under Radix’s vision of being a universal marketplace of digital assets, Copper is helping to build the roads and bridges that will bring tokenized assets onto the Radix network.
      • Partnering with Copper gives Radix the tools to provide a quick and secure, low-friction wrapping service.
      • While minting wrapped tokens is one thing, providing the infrastructure that locks native tokens in exchange for wrapped ones (and vice versa) is another. Copper’s custody platform acts as the reserve that guarantees the value of Radix-compatible wrapped tokens.
      • Copper provides the compliance standards and institutional-grade infrastructure that institutional token holders require, and it is capable of offering specialized services for individuals or organizations that wish to use Radix tokens within a custodial wallet and exchange trading services. (This is not to appeal to retailers as much as it does to deep-pocketed, highly-regulated organizations.)
      • As Copper expands the tokens it supports, it adds gateways from other blockchains into the Radix ecosystem.
      • The Radix Wrapping Service, facilitated by Copper, opens the first link from the galaxy of tokenized assets to the Radix network, and vice versa. (Think the EXRD–XRD bridge.)

      Notoros (previously Noether) DLT / Object Computing

      • Notoros is a protocol for executing distributed applications in parallel using a decentralized ledger.
      • The architecture can support native privacy features and cross-platform communication.
      • Object Computing is a consulting company that specializes in designing and building solutions using technologies like machine learning, blockchain, the internet of things, and cloud computing.
      • It is helping to onboard new businesses and decentralized applications into the Radix ecosystem while developing enterprise-focused features for Radix.
      • Notoros and Object Computing are working together to develop an Ethereum-based smart contract platform for the Radix Ledger.
      • By facilitating Ethereum dApps to migrate to the Radix ecosystem, smart contracts maintain their Ethereum-native versatility and move at the speed of Radix.
      • Providing scale and speed to Ethereum via Radix will lower the barriers to entry and potentially create new sets of business models and use-cases.

      Radix x Quantstamp

      • Quantstamp is a leading security auditing service for blockchain systems, platforms, and smart contracts
      • It is also known as the creator of the Chainproof system for decentralized, market-driven smart contract insurance.
      • Partnering with Quantstamp will bring mass-market security to DeFi applications and assets on Radix.
      • Quantstamp already audits the unlocking smart contract for the EXRD token and will be expanding into Radix’s modular smart contract developer components.
      • Components audited by Quantstamp will be covered by its Chainproof insurance which will integrate into dApps that will be as easy to audit as adding modular components.
      • Radix expects that the addition of Quantstamp’s security audits and automated insurance on funds managed by smart contracts will accelerate mainstream confidence in Radix DeFi applications.

      Founder Dan Hughes’ Twitch channel that he uses to connect with members of the Radix community.

      Community

      Spreading itself across all the relevant social media platforms, Radix is making a serious effort to build a community around its project. With an active Telegram channel, Discord server, Twitter account, subreddit, and podcast (The DeFi Download), Radix keeps its community informed on all updates surrounding the project, in addition to providing insightful content about industry topics in general. The community itself is strong among individuals, with node-runners building reputations on Discord to eventually solicit delegated stake. Community members even contribute to the research arm of Radix by running nodes on the current Cassandra testnet with founder Dan Hughes live on his Twitch channel.

      Radix is building an extremely active developer community focused around its Scrypto programming language, developer component catalog, and future dApp ecosystem. After an extensive review of the Radix whitepaper and queries via its search engine, the one thing Radix failed to fully elaborate on is its governance structure. It appears that developers will be at the core of making changes, similar to on-chain governance of blockchain protocols where developers first propose a change through a code update, then each node votes on whether to accept or reject the proposal. On a side-note: Although the forums and communication channels are great ways to find answers about the project, be aware that much of the social media has no shortage of cult-like members voicing their undying support for the project.

      Radix Competitive Comparison
      Transaction throughput versus legacy systems.

      Did Radix actually process 1.4 million TPS?

      In a controlled and open test environment, yes. This is how many projects demonstrate their transaction throughput. All of Radix’s trial code for this scalability test can be found on its Github. It also explains in a two-part series on its blog how it built and deployed the test. The first part is a high-level read, digestible enough for those with a good understanding of blockchain and distributed ledger concepts. The second part is a deeply technical explanation that dives into the code and logistics of running such a test.

      If you’d like to save some time and not navigate out of this site, here is a brief summary of the salient points: Radix replayed Bitcoin’s entire 10-year transaction history (up to June 2019, when the test was conducted) in less than 30 minutes. Because Radix is not a blockchain and Bitcoin groups transactions into blocks, the Radix team converted Bitcoin’s dataset to Radix transactional entities known as Atoms, a dataset it could process. It conducted the test utilizing 1,187 Google Cloud nodes distributed across 17 countries.

      Back in 2019 (before a larger than 1 billion dollar market cap), Radix explained that its fundamental limitation is “how much money we are willing to spend on running these tests.” (In other words, it thinks it can handle more, it just has to keep paying to do more tests to prove it.) In addition to providing the test code, Radix’s Github also contains the tooling that allows anybody to set up a test network in Google Cloud to verify the strength of Radix’s tech for themselves.

      In short, Radix legitimately did what it says it did. Although I don’t hold a Ph.D. in computer science, nor am I pretending to be smart enough to understand everything that Radix explained it did for this test, I am privy to the power of peer review. The power of highly intelligent trolls and internet warriors fighting the good fight to expose false claims and forever uphold the purveyors of such venomous duplicity. Hence, if Radix lied, some credentialed expert would have called them out within the last two and a half years, boosting their reputation for disproving the claims of a billion-dollar entity. But no one has, the test code is public, and Radix is a top 70 project by market cap. Only one question remains: Will Radix deliver the same throughput when its final, sharded mainnet version is released outside of the testnet environment?

      Radix Genesis
      Diagram explaining Radix’s mainnet launch and two-week migration toward decentralization.

      Centralization and Mainnet Genesis

      The Radix mainnet was centralized for all of two weeks. The mainnet initially launched under a two-week “bootstrapping” period where Radix-controlled nodes secured the network, giving the community time to fairly start swapping EXRD for XRD, staking assets, connecting nodes, and registering validators. After that initial two weeks, known as Epoch 1, the Radix Protocol became responsible for automatically choosing the top 100 validators — based on the amount of delegated stake — to secure the network for each following epoch thereof.

      That set of 100 validators then participates in consensus until the end of the epoch, and then the cycle repeats. When the fully sharded Cerberus hits mainnet under the Xi’an release, there will be no limit to how many validators can participate. Because neither Radix nor any of its underlying entities have control over the validator selection process or who can use the network, Radix is both fully decentralized and permissionless.

      The Critique

      If you made it this far, you’ve probably thought more than once about investing in EXRD for Radix’s growth potential, or VPNing — if you’re in the US — into Bitfinex and buying some XRD to send to the Radix Desktop Wallet to earn those juicy 11–12% staking rewards. (I did both.) Before you dive in too deep, take some time to consider any concerns about Radix. (This seems like a good place to put a disclosure to counter any FUD rebuttal: I own a disclosable amount of XRD/EXRD.)

      Timeline

      Radix has a long timeline till all of the beautiful things it is promising operate together (sometime in 2023 assuming no delays). That’s somewhat of a positive given its lack of exposure, but largely a negative. The last thing an investor wants is a niche investment failing to deliver its ambitious products on time, or worse, it launches a dysfunctional product — hence, why it’s not the worst thing that it’s not over-ambitious.

      However, what would hurt its humble roadmap would be if, by the time the project’s kick-ass features are fully functional, it’s too late to capture sufficient market share. Etheruem does not suffer from this. I personally don’t think it will launch a sharded Ethereum 2.0 when it says it will, but I also don’t think that’s going to affect anything. Lots of deep-pocketed investors, institutions included, will not pull out from a hiccup in what will be Ethereum’s catch-up to PoS peers threatening a flippening (passing Ethereum in market cap).

      Timing

      Radix needs to be lucky with great timing. Its 1.4 million TPS is a beautiful marketing asset, along with replaying 10 years of Bitcoin history in under 30 minutes. This gift, however, may also be a curse. Its current Olympia mainnet only processes 50 TPS. Imagine going on a Tinder date and finding out the photos your date posted were actually AI-generated photos of what their plastic surgeon projects they will look like after a full-body surgery. Needless to say, I felt a bit deceived, disappointed and underwhelmed that Radix is currently not what I thought it was.

      I almost forgot how I started the previous paragraph: Timing, Radix needs great timing. If the masses hear about Radix via its over-enthusiastic, cult-like community who constantly promotes its marketing assets, and then see 50 TPS is its current capacity, they might also feel deceived, if you will. Investors would ideally want the masses to come after the great features are launched; unfortunately for investors, Radix enthusiasts tend not to do their own research and often post about the great things yet to come as if they are already here.

      Fees

      Why leave Ethereum for a blockchain like Solana, Polkadot, Terra, or maybe even Radix at some point? The speed and the fees are the typical reasons. There is no question about Radix’s speed (unless, of course, it utterly fails at launching new versions of its mainnet). Its fees, however, might be a future turn-off. Right now, in an underdeveloped mainnet that settles basic transactions pretty quickly, fees are low. As development kicks in, complex products are created, and developers get a taste of setting their own royalty fees, I’m afraid fees could potentially balloon for network users.

      A simple example from the Radix whitepaper highlights the potential for royalty fees on the development of a constant function market maker (CFMM). The CFMM isn’t a very complicated service, so when I saw the example casually float an 8.6 XRD (XRD hovers between $0.25–0.60 USD, so $2.15–5.16) transaction fee, I was shocked. (Radix Defi White paper, pg. 18–21.) As someone who’s more likely to be a user than a developer on Radix, I see the potential for high, Ethereum-like fees. If the current XRD price were $0.25 and Radix’s fully-diluted market cap (to get a low-end estimate) were $5.8 billion, being equivalent to Ethereum’s at $450 billion (another low estimate), 8.6 XRD would equal $166.

      Developers should get paid, but not at the expense of potentially skyrocketing fees for users, especially when XRD increases in value. Yearn.finance is an incredibly complex, automated financial application that, built on Radix, would no doubt use a ton of components to complete transactions. All those components mean more fees for users. Radix allows developers to adjust their fees; however, this is completely at the will of the developer and is not a sure-fire way to solve an issue of rising fees. Why can’t the protocol just add a reasonable flat fee increase for component usage types that get split evenly among components used, and have a DAO or governance structure dictate future fee rates? This would be a simple, community-driven solution that still allows for an innovative developer royalty system, also protecting users from high fees.

      Conclusion

      I’m invested in Radix. I stake Radix. But I clearly have my issues with Radix. The timing has to be right. People cannot flock to this ecosystem expecting to build dApps and participate in a thriving DeFi environment, it simply doesn’t exist yet. People also can’t come expecting the 1 million TPS throughput when it will at least take another year to implement the fully sharded Cerberus consensus layer. I get the feeling that Ethereum users are ready to jump ship if Ethereum 2.0 underwhelms with delays; however, they won’t be jumping to Radix, because if they do, they will have nowhere to go, nothing to do. They would probably seek greener pastures in Solana, Polkadot, Cosmos, Algorand, or Kusama (also Polkadot) ecosystems, places that are more developed.

      Radix does a lot well… in theory. Test environments and rhetoric are one thing, but supporting the global financial and communications systems is another. The R&D journey that founder Dan Hughes went down to arrive at Cerberus is incredible; however, we still have yet to see a viable platform for developers to launch smart contract applications for mainnet users. The incentives are an incredible selling point that will hopefully drive development. They may also bring the unintended consequence of high transaction costs for executing complex applications. High fees could potentially push users to other established ecosystems like Polkadot or Cosmos, which are currently hosting many DeFi projects that users can interact with.

      With competition actively supporting applications for mainnet use and Radix planning to have a full release of its network by sometime in 2023, it may be too late to capture a reasonable share of the market (a big loss of first-mover advantage — for outside-of-Ethereum options). It also would ideally benefit from people finding out about its incredible network stats when they come out. Learning Radix can process 1 million TPS is almost too good to be true, till you do some more research and realize it is too good to be true because it can only support 50 TPS on its mainnet while many competitors can support thousands. Regardless, I still invest in Radix and stake XRD. I believe in good leadership, clear goals, innovative approaches, a quality website (my biggest investment turn-off is a poorly maintained website), and potential.

      Thus far, very few projects offer — or plan to offer — what Radix is planning. It essentially seeks to automate services like PayPal, Visa, Mastercard, and backend banking systems. It’s about time the white-collar elite who invest in automation technology for automotive and retail get threatened by automation themselves. (I’m not a populist, though.) If Radix succeeds, there may be no bigger selling point in all of crypto for a completely decentralized, secure, and infinitely scalable network to support virtually any industry’s ledger-reliant operations.

      About The Author

      Micah Casella

      is a digital asset investor with a background in traditional banking. Working on the inside, he has seen the benefit that a little digital disruption can have on the archaic finance industry. He sees blockchain and digital assets similarly modernizing other industries for the better.

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