#AelfExplained - What is the AELF project and do I invest?
#AelfExplained - What is the AELF project and do I invest?

#AelfExplained - What is the AELF project and do I invest?

By bitcoindelight | bitcoindelight | 9 May 2020

Today, I decided to participate in the latest Publish0x contest. This contest is named 'aelf Explainer Contest'. I was slightly resistant to participate. This is a quick overview of the topics I covered during this article:

1 Why did I hesitate to participate in this contest?
2 What is the AELF project?
2.1 But what is their Token (ELF) and how it is used? 
2.2 Who are competitors and how is ELF different from the competition?
2.3 How did the ELF developers distribute their Tokens?
2.4 What is the current status of AELF?
2.5 How did ELF perform since it was released?
2.6 Who is behind AELF? Are the developers trustworthy? 
3 Do I start thinking about taking ELF in my portfolio?


1 Why did I hesitate to participate in this contest?

Well, let me be honest I expect that most people will copy & paste pages and abstracts from whitepapers and previous articles about the AELF project. Will such an article work in the favour of the contest, will it allow you to bring you closer to an understanding what this project is all about? Simple answer: No, I don't think so... I will approach my article different....as I haven't heart about AELF so far and I don't expect that there Token is among the Top100 cryptocurrencies so far I come from a point as an investor. As an investor I would like to get an answer about what is the problem this project tries to solve, is it a unique idea, did I come across a similar project, can it be easily adopted, do I feel comfortable to invest in their project based on the information I can get and understand.

So, the good thing is that the contest is all about what the AELF Project is. So my curiosity was triggered to see what information is available about the AELF project and to see if this is something I am interested about.




2 What is the AELF project?

The Whitepaper is from the 7th June, 2018 and names AELF 'A Multi-Chain Parallel Computing Blockchain Framework'. The official website talks about AELF as a 'Decentralized Cloud Computing Blockchain Network'. According to the whitepaper, meeting commercial needs require blockchains to use a versatile system.

This Chain must address three main challenges:
1. Current Blockchains are not scalable, as the performance of one single node/mining machine determines the performance of the whole system.
2. Current Blockchains do not segregate resources for different Smart Contracts, which causes to interference between Smart Contract executions.
3. Current Blockchains do not have pre-defined Consensus Protocol to adopt updates or adapt to new technology.

AELF tries to address these challenges with the following design:

It will contain the following main features:
1. Main Chain and multi-layer Side Chains to handle various commercial scenarios. One chain is designed for one use case, distributing different tasks
on multiple chains and improving processing efficiency
2. Communication with external Blockchain systems, such as Bitcoin and Ethereum, via messaging
3. Parallel processing for non-competing transactions and cloud-based service
4. Basic components of minimum viable Block and Genesis Smart Contract. Collection for each Chain to reduce data complexity and achieve high
5. Permission for stakeholders to approve amendments to the protocol, including redefining the Consensus Protocol; Permission for Side Chains to join or exit from Main Chain dynamically based on Consensus Protocol, and therefore introduce competition and incentive to improve each Side Chain

(source: https://aelf.io/gridcn/aelf_whitepaper_EN.pdf?v=1.6)

I am not a developer so I can't fully relate to the problem here. Therefore I jump into their marketing material. Hopefully, it will explain the problem and AELFs approach in plain English.

ælf is a decentralized self-evolving cloud computing blockchain network that aims to provide a high performance platform for commercial adoption of blockchain. In order to establish a blockchain infrastructure for various commercial requirements, ælf provides a highly efficient multi-chain parallel-processing system with cross-chain communication and self-evolving governance. It brings 4 key innovations:

  • Scalable nodes on cluster of computers
  • Parallel processing for maximum utilization of processing power
  • Resource isolation for smart contracts via independent and specialized side chains
  • Interoperability to run on and flexibility to choose from different consensus protocols (DPoS — native, PoW, PoS) and private / public chain
(source: https://medium.com/aelfblockchain/in-case-you-forgot-here-is-a-little-refresher-on-aelf-3d5dbc5a1b47)

In my own words: the developers from aelf claiming that blockchains like a Bitcoin or Ethereum won't scale to meet commercial requirements. Therefore their network (operating system) will address these issues through the innovations mentioned above.



2.1 But what is their Token (ELF) and how it is used? 

ELF tokens are used to pay resource fees in the system, such as deployment of smart contracts, operating and upgrading of systems (transaction fees, cross- chain data transfer fees). It also enables the community to vote on major on-chain decisions, such as electing mining nodes, introducing new features to the system and other major decisions, which collectively enable self-evolution capability of the network.

(source: https://medium.com/aelfblockchain/in-case-you-forgot-here-is-a-little-refresher-on-aelf-3d5dbc5a1b47)

ELF is currently ranked on #118 on coingecko with $USD 0.073475.  




2.2 Who are competitors and how is ELF different from the competition?


Cosmos (CMC universe coin) is a continuation of ideas put forward by the multi-chain system, the Satoshi's PoW consensus
algorithm replaced by Jae Know's Tendermint consensus algorithm. Tendermint, a Byzantine-fault-tolerant algorithm, is
optimized for PBFT and requires only two rounds of voting to reach a consensus.

Essentially, it contains multiple blockchains (running in the zone) using separate instances of Tendermint, and a chain of
hubs using de-trusted communication. Cross-link communication is limited to the transfer of digital assets, this cross-link
communication can return data and path, such as sending the sender information of the transfer status.

Aelf's cross-link communication is not only capable of transferring digital assets, but also able to pass any other information.
For example, aelf’s sidechains can trigger contract execution on other sidechains.

In addition, Tendermint did not come up with a parallel processing model on a single chain, so a chain also has its own
limitations. CMC performance is limited to a single machine, scalability will only be reflected when using multiple instances of

Aelf has proposed that parallel processing on a single strand will dramatically increase the upper limit of single-strand processing


Both EOS and aelf have proposed to use parallel processing to handle transactions, but the difference is that EOS only processes
in parallel on the main chain, while aelf's parallel processing framework enables parallel processing on all side chains.

By doing this, parallel processing will be performed on both the backbone and the sidechains.


Ethereum has no scalability, no isolation of resources, and the popularity of CryptoKitties, CryptoZombies and more games to
come will block the transfer of the entire Ethereum network.

Aelf adopts the architecture of resource isolation to ensure that the surge of traffic on one chain will not affect the efficiency
of any other chain.

(source: https://bitcointalk.org/index.php?topic=2625637.0)

Lisk and Icon may be the most similar to aelf in that they both use side chains in an effort to build their DApp ecosystem.

(source: https://coincentral.com/aelf-beginner-guide/#how-does-aelf-work)

I can't really judge if those statements are true or not. I haven't used any of those cryptos in-depth except ETH but for example I won't say ETH is not scalable at all...take a look at those resources and start studying them as well to make a decision who is ahead.



2.3 How did the ELF developers distribute their Tokens?

There was no ICO, only private placement. There were 250 million ELF tokens distributed in exchange for 55 000 ETH contributed. Total suply is 1B ELF tokens and is distributed according to the following pie chart. The foundation has a 3-year freezing period. The team has a 2-year freezing period. Advisors and partners have a 2-year freezing period.


(source: https://steemit.com/ethereum/@oxfordcrypto/a-complete-guide-to-aelf-formerly-grid-the-polkadot-of-china-partnered-up-with-fbg-draper-dragon-gbic-decentraland)



2.4 What is the current status of AELF?

On Monday, 17th Feb, 2020, the aelf Economic & Governance model was announced on twitter with a link to the Economic and Governance Whitepaper. This Whitepaper provides insight surrounding the financial structure of running a node on the aelf blockchain. It is broken up into 3 main topics: Token Model, Incentive Model, & Governance.

(source: https://medium.com/aelfblockchain/aelfs-economic-governance-model-announced-1bd5e949a1f9)

It seems they are close to launch the AELF mainnet:


(source: https://www.publish0x.com/aelf-blockchain/aelfs-mainnet-launch-roadmap-xdeool)

2.5 How did ELF perform since it was released?


(source: https://www.coingecko.com/de/munze/aelf)

First time listed here on January 7th 2018 with $USD 2.51 we see it performed similarly to a lot of other altcoins- traded today on different exchanges for approx $USD .07 cents. 


2.6 Who is behind AELF? Are the developers trustworthy? 


I always appreciate pictures from the core team on a project site. But I would recommend adding Linkedin profiles as well. On top we can see their advisor team as well:


None of those names ring a bell for me. But I started googling on some of those names and at least they seem legit. If they are helpful to the project, a tough question to answer. But overall I think the project seems to be legit.


3 Do I start thinking about taking ELF in my portfolio?

The project and token require to have a very good understanding of how blockchain development works and it seems to be beneficial to be capable of identifying possible bottlenecks of existing designs. To be honest, I don't have this knowledge and therefore it is extremely hard for me to judge, if the devs of AELF are right or wrong about the claims they make according to existing blockchain projects and if their innovations will lead to greater scalability. 
Today, as a user (nor developer) and from an adoption point of view in terms of people using cryptos in a commercial way  - I don't see a problem with Ethereum. Would I be able to tell a difference if I buy a product tomorrow from a blockchain running on Eth or AELF - probably not! I reckon they need to point out the benefits for the end-user more if they are looking for more support. It is incredibly hard to predict how blockchain will progress in general. So either the devs are way ahead their time or it is a good idea but there is no current use case for it. 
Although I won't consider buying ELF now I will keep them in mind once we start seeing more adoption of cryptos in a commercial way.


I hope you enjoyed reading my article and I was able to provide you with information and resources that you can build your own opinion about AELF. Any feedback is welcome.

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I started mining and trading in 2017, participated in airdrops, hardforks, and ICOs. I spent much time making myself familiar with technical analysis. I like to make people aware of things I am currently doing in the crypto space, projects I am currently spending time on.

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