Tezos Dalphanet is up: the testnet for the next upgrade, including privacy features

By Allen Walters | Publish0x posts | 17 Aug 2020

Quick Tezos recap so far:
- Still the most decentralized PoS network up to date, even after the launch of Cardano's PoS, which is now in the process of decentralizing their PoS network.
- Unique on-chain governance model, providing for:
Swift evolution
Prevents harmful chain splits
- Institutional-grade smart contract
- Multiple smart contract languages and multiple tools for development available

Dalphanet: a testnet for the Delphi upgrade
After 3 successful upgrades, and 6 proposals, the fourth upgrade, called "Delphi" 007, is in the final stages of preparation for submission to the network. Dalphanet is the testnet for the Delphi upgrade. This is a highly anticipated upgrade, mostly for the exiting new feature it will add to the Tezos blockchain: Fine tuned privacy features.

Some important players in the Tezos ecosystem have mentioned the importance of this feature for major adoption in real-live business applications. Tezos will be the first major decentralized public smartcontract platform to ad this feature as an option.

Ryan Lackey in relation to the exploration of CBDC (Central Bank Digital Currencies) solutions:
Big open question is just how to get the right solution out there. Privacy is one issue that various central banks [that plan on] deploying this stuff, have on their radar. Generally I’d say European banks are very demanding of privacy, especially when value thresholds can be set, but each bank and regulator will be different. - Source

BMW Group Systems Architect Carlo van Driesten on the upcoming privacy upgrade:
The integration of privacy with zero-knowledge proofs, or so-called zk-snarks, is followed with high interest since the first branch of sapling was spotted in Q4/2018. Zero knowledge proofs allow for selective privacy on business transactions to reveal them to auditors and shield them from competitors – it is the cornerstone to use public blockchains in a business context. - Source

The privacy that will be added to Tezos does not bring common holders the option to send private transactions. It brings devs the option to implement privacy into their dApps or other applications on Tezos. So very interesting and important for adoption, but for every day holders of XTZ, wallets devs would need to build the feature into their wallet.

Improving on-chain governance
Part of the Tezos protocol is a solution for decentralizing governance: who decides what adjustments will be made to the core protocol of the blockchain. All current decentralized blockchains have centralized governance. Tezos has decentralized this since the launch of mainnet over two years ago. More about this topic and the problem it solves here. Hard forks can be a risks for DeFI, NFT's and STO's. Here's how Tezos avoids this issue. 
Up to this point, all holders of XTZ have voting rights. But voting is done by bakers. (People running a Tezos node) Any holder of XTZ, can delegate their XTZ (and thus their voting power) to bakers. Now most bakers are open to discuss voting with their delegaters before each voting round. It differs per baker, some will make their intentions known beforehand, and for some, delegaters need to reach out to discuss the topic.
In the next upgrade, delegaters will get more power, and can override their bakers vote. This perfectionizes Tezos' on-chain governance model.

Improving smooth transition
Delphi will also add a 5th period to the governance cycle: an adoption period. This should give everyone that is part of the network and the Tezos ecosystem some more time to adjust and integrate the new protocol changes, before mainnet is upgraded.

I can't comment on the time-frame, last time I wrote about this upgrade, it was estimated to be up in the next governance cycle. That turned out to be a bit of an optimistic estimate. But since testnet is up now, we seem to have set a crucial step into the right direction.

Exciting times ahead. Hope you guys enjoy the ride towards the next bull-run and in the mean time: Hold, stake&bake!


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Allen Walters
Allen Walters

Fascinated by blockchain and future proofing cryptocurrency. Discover the tech before it gets relevant. Twitter: @IgnoranceIt

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