Unlike traditional bitcoin-like blockchain, where all transactions are compiled in blocks in a single blockchain, block lattice (introduced by Nano) is a collection of multiple blockchains. That’s why we also call it blocklist as that’s how exactly the Lyra node database looks like – a big list (collection in nosql database terms) of blocks. Each user account adds transactions to their own blockchain. Such architecture enables extremely high scalability, instant authorization and settlements, and super light clients. Let’s review them one by one.
High Scalability (large number of tps – transactions per seconds) is achieved because each block contains just a single transaction which is added to a relatively short account blockchain, which allows the authorizer node to complete a processing (either authorization or settlement) of multiple transactions simultaneously, within a very short period of time. Only authorizer and authorizer candidate nodes (see white paper for details) must carry the full blocklist, which means they are dedicated powerhouses of the network. Clients (wallets) don’t need a local node, and they carry only their relatively short blockchains, or no blockchain at all (see the Light Clients section).
Instant Authorizations and Settlements are achieved because each transaction consists of two blocks: send (authorization) and receive (settlement), while each block is authorized individually, returning immediate result to the client. In traditional blockchains, transactions are accumulated in blocks, and blocks are added to the same blockchain, which prolongs both authorization and settlement times to minutes and even hours. Also, any balance in Lyra account is spendable right away – no locked/unlocked balance anymore.
Super Light Clients are possible not just because each client has its own blockchain, but also because each block contains full information about account balance. Unlike traditional blockchains, where transaction is typically compiled from multiple inputs located in various blocks located all over the entire blockchain, only the most recent account block (not the entire blockchain, and not even a single account chain) is required for a Lyra client to process a new transaction. It means no blockchain database is required on the client side, and no scanning of a database located on local or remote node “in the cloud” is required for performing many fundamental client functions (such as payment transaction). Thus, Lyra client can be easily deployed on IoT microdevices and smartcards with limited CPU performance and storage space.
Most cryptocurrencies have a period of time called “locked balance”, when partial or all funds in a wallet cannot be used for new transactions. It happens after every transaction no matter you receive new transfer or send funds to someone. This way most blockchains prevent spending of funds located in blocks that are not yet “confirmed” by the network. Proof of work blockchains are especially prone to this problem because recent blocks can be “rewritten” by someone who has more computing power. Such a “fork” makes transactions in several recent blocks invalid minutes or even hours after they were initially “accepted” by the network and even added to a blockchain.
Locked balance problem is very inconvenient and prevents adoption by mainstream. Imagine a situation when you have $1000 in your payment card and you bought something for just $1 but cannot use the card for another hour as the entire card balance is locked by your bank.
Lyra solved locked balance problem, thanks to blocklist architecture. Since every transaction is written into its own block, and every transaction block is individually and instantly authorized by the network, there is no need to lock any balance to prevent double spending. Once transaction block is signed by the authorizer nodes it becomes the part of immutable account blockchain which cannot be modified. The account balance becomes spendable right after authorization response (for any transaction) is received from the network.
There is no waiting time for “confirmations” in Lyra, and no balance lockups, so how double spending is prevented? Every Lyra spending transaction is written in its own block. Therefore, each transaction block is authorized and signed by the network (authorier nodes) individually. Once block is authorized, transaction is added to the account blockchain in the node databases and becomes immutable. It takes just fractions of seconds to complete authorization of transaction block. Since each account has its own blockchain, the only scenario for double spending is when the account owner creates and signs two blocks that look at the same previous block in the account blockchain, which is immediately detected by the authorizer nodes. Only one of double spending blocks will make it into the blockchain, all others will be rejected. If spending block is rejected, the recipient of such transaction cannot use it to create the receiving block because such a block would be rejected as well.
Lyra was developed as part of and in support of GRAFT.Network project.
GRAFT Network project is a combination of blockchain-based technologies that together provide a solution for decentralized payment processing at the point of sale. What Lyra brings to GRAFT Network is an ability to create proprietary tokens (referred to as merchant tokens in the original white paper) that could be used as part of the overall GRAFT Network payment as illustrated by this graphic:
LYPE token will be used as the staking and gas currency for Lyra Permissioned network. Lyra Permissioned network will allow the customers (such as Shopify merchants) to participate and receive a share of profits earned by the network for processing token transactions (loyalty rewards, store credits, gift cards, corporate and state currencies, etc) in a cooperative model. Staking amounts start at 10000 LYPE, with distributions proportionate to the staked amount.
The goal of the permissioned network is to establish presence and leadership in the market as well as to flush out the technology to make it ready for decentralization.
Note: Once Lyra’s source code is released under a permissive license (as part of permission-less network rollout or before), anyone will be able to launch their version of the Lyra network, just as nothing stops anyone from forking and launching GRAFT Network or other open blockchain clones.