CoinMarketCap takes a deep dive into an enterprise-grade blockchain platform that uses a first-of-its-kind digital identity layer to power the first wave of regulatory-compliant dApps.
By leveraging zero-knowledge proofs, Concordium claims to provide users with full privacy while using the blockchain, but still ensures accountability thanks to the option of “revocable” anonymity.
It also gives developers and users a fast, secure and highly capable platform that makes building and using DApps a more accessible task. ID to facilitate regulatory compliance at the protocol level, low fiat-stable transactions fees, and instant finalization are some of the key features that help Concordium achieve large-scale adoption.
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Who Is Building Concordium?
In development since 2018, Concordium is built by an accomplished team of more than 30 members, many of which are software engineers, researchers or developers.
The founding team is formed of Lars Seier Christensen, Chairman of the Concordium Foundation, and co-founder and former CEO of the online trading and investment platform Saxo Bank; Professor Ueli Maurer, Head of the Information Security and Cryptography Research Group at the Swiss Federal Institute of Technology Zurich; Simone Monnerat, an attorney-at-law, and civil law notary; Bjørn Krog Andersen, a Concordium Foundation board member and Head of Legal Compliance for Banking Circle; and Ian Zhang, who has more than two decades of experience in corporate finance.
Some key C-level team members include CEO Lone Fønss Schrøder (entrepreneur, fintech co-founder, C-suite experience at Fortune 500, Vice Chairman of Volvo and director at IKEA), Group CPO/CTO Kåre Kjelstrøm (entrepreneur, Silicon Valley startup veteran from multiple ventures including Uber), the Pedersen commitments father, Torben Pryds Pedersen, previously head of Cryptomathic's research and development team, CFO Jørgen Hauglund, with large corporate, banking and trading platform experience, and COO Conor Ringland, an expert in institutional sales from Saxo Bank and Lloyds, in investor relations, operations, online trading, and digital strategy.
How Does Concordium Work?
Any user that stakes more than 14,000 CCD can become a baker, while finalizers need to stake at least 0.1% of all CCDs.
Concordium is a non-permissioned and fully decentralized platform, which is why anybody can join the network as a node operator, helping to participate in on-chain consensus by validating blocks. These users are rewarded for their contribution in the form of transaction fees and a share of the CCD token emission (proportional to the size of their stake).
As we briefly touched on, Concordium has an identity layer that, in contrast to fully anonymous systems, provides users with privacy, while ensuring regulators can selectively identify participants if needed. This novel feature is one of the enablers for the applications build on Concordium to comply with KYC and AML regulations.
The ID mechanism will support large-scale adoption from DeFi and other business verticals and ensures regulators can selectively identify users without breaking overall transactional privacy — a process that would require a court order or some law enforcement interaction to initiate.
From a technical standpoint, Concordium's identity layer uses trusted identity issuers to provide users with their self-sovereign identity, while on-chain transactions are carried out privately by using cryptographic means to prove that all participants have been verified without disclosing their identity. The solution is GPDR compliant.
Concordium has been operating its mainnet since June 2021, bringing with it a 2-layer consensus- and finalization system, encrypted transactions, and Rust-based smart contracts. The next stage of its roadmap will see the addition of smart contract templates, improvements to the mobile wallet, deployment of several SDKs, launch of its ecosystem portal, and more in H1 2022. Concordium is delivering a low code/no code toolbox and ready-to-use applications to support adoption.
What Makes Concordium Unique?
As a state-of-the-art blockchain designed to provide a powerful execution environment for smart contracts and digital financial primitives, Concordium offers a number of unique features that help it accomplish this goal and distinguish itself from the competition.
Privacy & Regulatory Compliance
Thanks to its self-sovereign identity solution, every participant on the Concordium blockchain has been verified as a real, live individual that has a blockchain-based identity credential. Because of this, applications can easily adhere to KYC and AML regulations without needing to manually KYC their users.
Backed by Science
Concordium is built on the principles, technologies, and solutions laid out in more than 70 academic papers published by its developers and the Concordium Blockchain Research Center Aarhus (Aarhus University) as well as a variety of prominent research partners. Being rooted in the latest scientific research, Concordium aims to leverage the latest insights to overcome the limitations faced by other platforms and power a range of novel use cases.
Speed & Throughput
Compared to other blockchains that only achieve probabilistic transaction completion, Concordium is able to achieve true, irreversible finalization within a few seconds. This means transactions cannot be rolled back, even if an attacker was able to subvert all other security protocols and take over the network completely.
Price Stable Fees
Unlike many other platforms, fees on the Concordium blockchain are stable in fiat (EUR) terms. This provides a more intuitive experience for both developers and users, while making costs far more predictable, helping to support business operations and product uptake.
Concordium arguably offers best-in-class sustainability PoS and Rust, which is one of the most energy-efficient coding languages. This design helps to reduce emissions.
The platform consumes orders of magnitude less energy (over 100,000 times less per node) than Proof-of-Work-based platforms and is built around highly efficient compiled code that helps to minimize energy consumption. The energy cost of running a node on Concordium currently sits at 108.6 kWh/year — the equivalent of charging an electric car once. For comparison, a single Bitcoin miner (using a Bitmain Antminer 14TH/s unit) would consume 28,470 kWh/year.
Regulated DeFi Lab
Concordium has launched the world's first lab for regulated DeFi products. The lab has an interesting grant program and will work to demonstrate how smart contracts can support compliance and regulatory needs, develop proof-of-concepts for new regulated DeFi products, and under the grant program assist in taking incubated concepts to market with some of the first commercially viable regulated DeFi apps.