FactomOct 23, 2018 at 1:13
Bitcoin may be the pioneer of the cryptocurrency market and continues to rein as the most traded coin but the platform on which it was founded is not without lapses.
A few core constraints for a better transaction are concentrated on speed as it may take 10 minutes to over an hour— depending on the level of security—to complete a confirmation process; and the blockchain’s size limit of 1 megabytes per block or seven transactions per second.
Add to these elements the volatility of the bitcoin prices. This brings uncertainty especially when the price spikes and companies need to turn over very large numbers of transactions.
To free up the Bitcoin token from the loopholes of the Bitcoin platform which mars its potential, Factom creates a protocol to separate the virtual coin and the system by residing on top of the Bitcoin blockchain. As a result, blockchain will be enabled in a wider range of applications across several industries.
“A distributed, immutable ledger is the radical, foundational, and unprecedented technology represented by the Bitcoin blockchain. The dream of many is to extend the honesty inherent to an immutable ledger validated by math to chaotic, real-world interactions. By allowing the construction of unbounded ledgers backed by the blockchain, Factom extends the benefits of the blockchain to the real world,” Factom said in its white paper.
To do this, Factom forms a hierarchy among a set of blocks, the highest being the Directory Blocks which constitute a micro-chain strung mainly with compact references.
Chains are groups of entries designed for specific application entries. Meanwhile, entries contain an application’s raw data or a hash of its private data.
“To keep the size small, each reference in the Directory Block is just a hash of the Entry Block plus its ChainID. These Entry Blocks have references which point to all the Entries with a particular ChainID which arrived during a time period,” read Factom’s white paper.
Another block in the Factom system and part of its micro-chain is the Entry Block for a Chain ID.
“The bulk of the data in Factom is at the leaves, the Entries themselves. These hierarchical data structures are rendered unchangeable by Bitcoin’s hashpower. They can be conceptualized as different layers,” it added.
The platform’s flagship products are the Factom® Harmony and the dLoc® by LINXENS
The Factom® Harmony converts document management solution into a blockchain-based platform that slashes lost documents, audit time and costly disputes.
Meanwhile, the dLoc® by LINXENS, dubbed a “breakthrough document authentication solution”, allows for a secure physical documentation on the blockchain.
For the platform’s token, Factom created Factoid to serve as the main internal scarcity token that will regulate and reward participants within the ecosystem.
Factoids are employed similar to Bitcoin, adopting its multi-signature security, multiple inputs, multiple outputs, among others. These are convertible to so-called Entry Credits and can be used to pay for Factom services.
Transactions processed using Factoids are completed in a “special Factoid Chain” which is more restrictive to access than other chains today.
“They also help to bind consensus. If consensus is lost, then the Factoids will fall in value,” Factom added.
Overall the implementation of Factoids makes the platform truly decentralized as it cuts down on the bloat and spam encountered in both Factom and Bitcoin.
How to buy?
Factoids can be purchased in Koinify which handles the software sale for Factom. Anyon can create a Factoid wallet using Bitcoin— the rate per BTC will diminish by 100 every 7 days.
Is it mineable?
There is a total of 8,753,219 FCT.