The XDC Network (XDC) is a hybrid blockchain platform designed with a robust and scalable architecture that can manage both public and private chains at the same time. This initiative eliminates the technical obstacles that hinder the integration of decentralized solutions into current business models.
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Key Features of the XDC Network
The protocol’s adherence to established standards for electronic messaging between financial institutions (ISO20022) enables its seamless integration into banking systems and ERP solutions, including SWIFT.
The XDC Network is fully compatible with all smart contracts and networks that utilize the Ethereum Virtual Machine (EVM).
The platform supports atomic transfers of tokens across different chains, positioning the XinFin Network as one of the most adaptable enterprise blockchain solutions available.
Advantages of the XDC Network
- Operating within a Closed Ecosystem
Organizations can operate without concerns about data breaches.
- Flexible Rule Management
Companies have the ability to modify certain settings as needed, while the core principles of the blockchain, such as transaction immutability, remain unchanged.
- Resistance to 51% Attacks
The hybrid blockchain architecture is resilient against such threats, as it prevents unauthorized access by hackers.
- Privacy Protection in External Interactions
Businesses can keep their data on a private network but have the option to adjust settings for communication with stakeholders and the public.
- Low Transaction Fees
The masternode system streamlines data verification, resulting in reduced transaction costs.
Smart contract platforms have been heralded as transformative in the financial sector due to their capacity to facilitate cross-border asset transfers more quickly and affordably than traditional systems. However, many existing blockchains face congestion and high transaction fees, which can hinder their effectiveness.
Launched in 2017 by the Singaporean fintech firm XinFin Fintech, the project was founded by Atul Hekade and Ritesh Kakkad, who envisioned a decentralized platform for financing international trade and payments, with regulatory backing. They sought to leverage blockchain technology to create a secure connection between investors and developers. To support this mission, the XinFin Foundation was established as a non-profit organization to foster relationships with governments worldwide.
The successful implementation of this vision is attributed to a strong team comprised of experts with extensive experience in both blockchain and finance. The unique hybrid architecture of the blockchain enables organizations to engage in cross-border smart contracts and execute real-time settlements. The protocol is based on the XinFin Delegated Proof-of-Stake (XDPoS) consensus mechanism, allowing verified masternode owners to validate and authorize transactions on the network.
Requirements for masternode operators include:
- A deposit of 10 million XDC coins
- 99.9% uptime
- A static IP address
The algorithm selects nodes to validate transactions for designated periods. Each epoch consists of 900 blocks, generated every 2 seconds, and a consensus is reached when 3/4 of the masternodes provide their signatures. Upon the completion of a block, participants receive rewards in the form of stakes.
To enhance security, the protocol employs a double-verification mechanism grounded in decentralized randomization. When a masternode generates a block, another randomly selected masternode verifies it before it is added to the blockchain.
The XDC Network operates under two distinct states:
Public Layer: Accessible to all users.
Private Subnets: Restricted to institutional and authorized participants.
The protocol is capable of processing up to 2,000 transactions per second with negligible fees, and this is not its maximum capacity.
XinFin integrates smoothly with traditional data exchange systems through several methods:
API Interfaces for ISO20022: When an operation is created, the transaction hash from either the private or public network is incorporated into an additional data field.
ERP Connectors: The protocol retrieves data from SAP systems in applications like Factor.io and TradeFinix, subsequently transferring it between private nodes using XDC Private (ISO20033) technology.
Basic Banking Connectors: This feature allows the protocol to gather information from financial systems, including accounts, balances, and transactions, which can be transmitted over either public or private networks.
SWIFT System Connectors: The network is capable of parsing MT103 messages.
Conclusion
The hybrid protocol holds significant promise as it addresses the challenges that previous ecosystems encountered, such as high fees, limited throughput, and restricted applications. By integrating this protocol into traditional banking systems, inefficiencies in the trade finance sector can be effectively resolved. This integration facilitates peer-to-peer transactions among governments, corporations, suppliers, and buyers.
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