What is Alephium, and how it works?

Alephium is a blockchain that seamlessly integrates decentralization, scalability & security, all while offering high-performance, accessibility & energy efficiency.

Alephium’s Proof Of less Work is a simple, consistent and robust consensus mechanism for achieving decentralization while reducing the energy consumption by over 87% compared to classic Proof of Work. On Alephium, anyone can run a full node and verify on-chain data.

Are you looking for a blockchain with expressive sUTXO and Proof-of-less-Work model? Inspired by Ethereum, but with way more smaller market cap, and with higher scalability, accessibility and security? Everything above can be found right here on Alephium. Alephium isn’t a typical PoW blockchain like others, but it’s a smart contrat sUTXO PoLW — Proof-of-Less-Work protocol, which features specialized EVM. Tokens built on it’s blockchain are unique in many ways and have a lot of advantages.

In Alephium, Tokens are first-class citizens, managed by sUTXO, starting from their main token $ALPH, followed by others and the next to be built there. One of the advantages is the scalability and safe & secure asset management.

“HOW ALEPHIUM SCALABILITY IS DIFFERENT FROM OTHER PROTOCOLS?”

Sharding is a database management technique that involves breaking down larger datasets into smaller, more manageable pieces. When dealing with large databases, it becomes impractical to handle all the data on a single machine or in a single table. Sharding enables the database to be distributed across multiple machines by creating multiple smaller tables, allowing parallelizing tasks to improve throughput.

It’s the same in a blockchain context: sharding increases throughput by parallelizing transactions. This comes at the cost of added complexity because it becomes harder to maintain a secure and consistent ledger. Every sharded blockchain addresses these tradeoffs in different ways:

Polkadot, a multi-chain platform developed by the Web3 Foundation, introduces a sharding mechanism known as “parachains.” Parachains are individual chains that run in parallel, interconnected through a central relay chain called the “Polkadot Relay Chain.”

Zilliqa implements sharding differently. It uses network-level sharding to scale the blockchain by splitting transactions into smaller blocks. However, it does not support state sharding, the global state of the blockchain has to be shared by all shards, which limits its scalability.

Kadena performs sharding by introducing “chainweb,” a braided blockchain structure which consists of multiple interconnected chains that collaborate to form a single network.

Alephium takes a unique approach to shard the blockchain: it involves using a DAG and a sharding algorithm called Blockflow. This is beneficial as it does not rely on a coordination chain (e.g. beacon chain), there is no loss of security for individual shards, and it enables single-step cross-group transactions (more on later).

Blockflow, Alephium’s sharding algorithm, aims to enhance blockchain scalability and efficiency by dividing the network’s transactions into manageable parallel chains or “shards”, while maintaining high security and effective communication between them for seamless transaction processing. It’s the rulebook for maintaining the “block flow” and blockchain correctness.

Blockflow is built on the unique combination of Alephium’s UTXO and PoW and leverages a two-dimensional DAG data structure. It delivers lightweight and efficient sharding that completely eliminates the need for cross-chain transactions & the complexities that come with it.

“ETHEREUM EVM against Alephium APS, advantages & disadvantages explained”

Ethereum assets are managed by contracts. So, for example, if Uniswap wants to swap token A for token B, the token A holder should first approve its spending on token A’s contract for Uniswap, and then Uniswap will have permission to do the swapping.

Although approvals play a crucial role in numerous decentralized applications on the EVM, they present critical risks for users:

• There is room for unsafe choices: This method leaves to the user’s discretion how much they will allow the smart contract to spend. The user can allow infinite spending, leaving an open door for his assets to be drained if an exploit compromises this smart contract.
• Broken User Experience: First, the user needs to send a transaction to approve an amount. And later, execute the transfer he wants. If the user only allows the amount spent in that particular transaction, the next time he interacts with this smart contract, all the steps will be necessary again.

Understanding Alephium’s Asset Permission System

Alephium’s APS is designed to provide a flexible and safer way for developers to build applications on the Alephium blockchain. One important feature of the Alephium blockchain is that it doesn’t require separate approval specifically for the assets. Instead, the assets are managed by UTXOs, which can be spent using a transaction. These transactions can support TxScript.

A TxScript (short for transaction script) is a piece of code to interact with smart contracts. Within this code, it is possible to use the APS to manage how the assets will be spent. The APS can:

• Mark functions with annotations to explicitly state if it requires preapproved assets or contract assets (and check if the annotation is consistent with the code);
• Ensure explicit assets approval for functions requiring assets, and ensure that, at maximum, only the explicitly specified amount of assets (ALPH and tokens) can be spent.
• Using the APS, in combination with the UTXO model, all the approvals can be defined beforehand. In one transaction, both the approval and the transfer of the assets are done following the TxScript conditions, resulting in a seamless and more secure User Experience.

How is the APS token approval mechanism different from the EVM’s ?

The APS built on Alephium provides several tools to improve the security of the transactions, generating multiple benefits for developers and users alike. When comparing APS with EVM’s asset approval mechanism:

• Assets Flow: In Ethereum, assets are managed by contracts, and approvals need to be pre-requested separately, breaking the transfer flow. In Alephium, funds can be sent (approval and transfer) using one transaction. It contains a TxScript using the APS functions, which manages the flow of funds together with smart contracts.
• Assets Approval: Ethereum’s token approval only allows for the approval of a specific asset. That equals multiple approvals when using more than one asset in a transaction. In contrast, Alephium’s APS allows asset management from multiple sources.
• Built-in Functions: Alephium’s APS provides built-in functions for committing assets and using them immediately, whereas Ethereum requires explicit approval and transfer calls.
• User Experience: The APS controls all fund management on demand, so the user manual interaction with the dApps is restricted to the transaction they want to make.
• Removing the token approval transaction in the asset management flow is an important upgrade provided by Alephium’s Asset Permission System, as, unfortunately, several exploits and hacks use this type of transaction. This type of attack demonstrates how Alephium’s APS provides a more secure environment for developers and users, reducing the attack vector by removing the approval transaction, the risk of fund loss due to smart contract vulnerabilities, and enhancing the user experience.

CONCLUSION:

Alephium’s Sharding design makes token transfers highly scalable. The UTXO model ensures efficient and secure transactions. No extra approvals needed for smart contracts — thanks to the Asset Permission System! No flash-loan attacks, which makes this protocol unique.

Alephium’s Asset Permission System (APS) offers a safer and more flexible solution to eliminate Ethereum’s token approval risks. Controlling the flow of assets, APS provides enhanced security and greater control over transactions.

As blockchain technology evolves, innovations like APS pave the way for safer and more robust decentralized applications. Developers and users alike stand to benefit from this improved approach to managing and securing digital assets on Alephium.

Personal opinion:

NOT A FINANCIAL ADVICE (NFA)

Alephium was sleeping giant and hidden gem in the previous bear market, personally me and a friend of mine who is miner, saw first the project did a good research about their team, tokenomics, their mechanism and he shared those thoughts with me, and I approved that, and my first buy was at 0.13cents per token.

Right now, ALPH is in correction stage, sitting at 100m marketcap at 1.5$ per token. $ALPH is one of the greater bags in my portfolio. Today, January 23th, $ALPH passed 100.000 unique active adresses on their network. $ALPH was developed and launched in bear market, and performed very well until now. Imagine what can happen in the upcoming bull market, also their community and their network is growing rapidly, so it makes $ALPH a must-have token in your portfolio.

Thank you for your time, i hope it was helpful.

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