A month for the books, for Witnet and for the broader cryptocurrency industry. Read on to learn about everything that happened in the Witverse!
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The elephant in the room
This has been a truly historic month in cryptocurrency. We have never seen anything like the FTX implosion.
These are difficult times for the broader cryptocurrency market and we are still recommending everyone take full control of your funds.
Without further ado, let’s jump into November!
In early November, November 2nd to be exact, Witnet experienced a network disruption that caused an inability for nodes to reach superblock consensus.
On November 2nd, Hetzner blocked mining cryptocurrencies on their platform. Hetzner is a massive cloud provider, or VPS service. They are generally considered the cheapest service compared to other VPS infrastructure companies and that is why 16% of nodes run on it to validate Ethereum transactions, and a whopping 40% on Solana. The major difference is that up to 80% of Witnet nodes were using it on the Witnet network because of the high profitability margins.
Witnet operates on what is known as a superblock consensus; every 10 blocks 100 nodes in the Active Reputation Set (ARS) come together to vote on the previous 10 blocks. If 2/3rds of nodes vote in agreement, then the 10 blocks are considered final.
Now, when Hetzner abruptly blocked cryptocurrency mining, this decimated the nodes in the ARS. Essentially it took a LOT of nodes out of the pool that can be used to vote on the superblock. As mentioned, 80% of nodes were most likely down for a period due to this ban, which meant that there were quite a lot of nodes immediately out of the ARS.
Now, this isn’t inherently a problem because there are mechanisms in place that allow the network to enter into a recovery. However, the next issue that we found was that many nodes were utilizing firewalls to connect to the network. This meant that firewall nodes needed to connect to public IPs in order to broadcast transactions, mine blocks, and essentially communicate to the network.
This created a system that had a “hub and spoke” mechanism, inadvertently. Basically there was a lot of hubs that were connecting these firewalled nodes to the network. When the network saw the disruption, there were far less “hub” nodes that created sinlge points of failure.
At this point, the recovery mechanism wasn’t able to be implemented automatically because nodes were voting out of sequence for superblocks. Consensus was finally reached on November 5th because of a manual recovery that put trusted nodes at the head of voting on superblocks. This was part of witnet-rust 1.5.4. The trusted set of nodes was in place for 7 days, and was withdrawn on November 12th after it was clear the network was back to normal.
If we’ve learned anything, it’s that we need to be using multiple cloud providers to spread out our nodes. We will also be harping on the importance of using public IPs when connecting to the network to avoid single points of failure.
Now, let’s get on to some more lighthearted news!
We’ve added Arbitrum Nitro Goerli as one of our newest chain integrations.
Last month, we announced the Dogechain testnet, and now Witnet is fully live on Dogechain mainnet providing price feeds and randomness.
We’ve additionally added Bobabeam testnet, Bobabase. This is a layer two scaling solution utilizng the Boba network on Moonbeam.
All of these integrations means Witnet is the oracle of choice for their growing TVL. We are looking at Ultron, Starknet, and Obscuro as our next chain integrations for the future.
Data feeds and protocols
ETH/USD is now live on our Arbitrum testnet. As for Bobabase, we’ve added BOBA/USDT and GLMR/USDT which are the native tokens for the Boba and Moonbeam networks. Finally, we’ve added DOGE/USD to Dogechain mainnet. All feeds are free to read from in contract storage on their respective networks!
Witnet total value secured is close to $5 million. As we’ve seen TVL shrink due to users pulling their tokens off defi applications, and lowering asset prices, Witnet’s isn’t immune to the ripples of the massive bear market. The Witnet TVS is shrinking proportionally to the rest of the industry. It is worth it to note however, that we’ve have two protocols, Chee Finance and Toucan Protocol that have added to our TVS. Chee, on Meter has $360k in TVL and Toucan has $449k. The former was a protocol we were unaware that was using Witnet and are delighted to bring them into our family.
We are monitoring the ecosystem closely to see varying chains and protocols and how they are reacting to the FTX implosion. It is important to stay vigilant and reassess where to extend our resources and grants.
The Witnet grant program has found another exciting opportunity in Pool Together, a liquid staking protocol on a few EVM chains. Witnet is extending a grant to them and we are still working out the details of the collaboration.
As mentioned last month, Witnet offered a grant to Toucan Protocol for 6 months of price feed subsidization. This grant is expected to be concluded in April, when we will reassess and decide how to move forward. Toucan has been a great partner and we’re so excited to keep working with them. The current funding for projects using Witnet through the foundation grant is up to $4,950!
Despite the network issues early in November, the Witnet network saw some incredible growth in data feeds.
We saw a 30% increase in total data request from October to November to 67,900, a 32% increase in HTTP GET and a 38% increase in HTTP POST. There were 255,355 HTTP GET requests and 7,006 HTTP POST requests in November. Interestingly enough, there was a decrease of randomness oracle requests from 436 to 382. We attribute the growth of price feeds to Toucan and other protocols that are using the network permissionlessly. We will find you!
We’ve been talking about a few protocol discussions on Github and Discord about how Witnet will move into the future. Every community call has focused on a few discussions, and this call was focused on the upcoming decentralized bridge.
The decentralized bridge is a huge step in Witnet’s long term sustainability. Currently the Witnet Foundation operates a centralized version of the bridge that allowed for early adoption and seamless interaction and payment with EVM chains. The time has now come for a decentralized version of this that allows for anyone to operate a bridge node, receive payment in an EVM chain coin, and relay the request to the Witnet sidechain (paying the fulfillers in WIT) and earning a fee for doing so. We expect the bridge to look like an optimistic rollup bridge of sorts.
This is a massive development in the ecosystem and we are looking forward to officially release it to the public.
The light wallet is still expected for February! We are getting really close to releasing it to the public and have been testing all the features daily.
The Witnet whitepaper turned 5 this past Saturday (November 26, 2022). We also celebrated the 2 year birthday in October. Since the network went mainnet, we’ve seen total data requests and value transfers hit 1 million each, a staggering number in just 2 years.
We will be harping on this a lot in the foreseeable future and it relates directly to the network disruption in early November. Node operators must be more vigilante about spreading nodes to multiple cloud providers so as there isn’t a single point of failure if an issue like Hetzner happens again.
We are also highly, highly encouraging node operators to utilize public IPs to help peers find each other in times of turbulence like we saw earlier this month.
That’s all for this month
And what a month it has been. Thank you everyone for sticking with us through the network disruption and the FTX collapse. It has been quite an interesting month to say the least. See you on December 28th for the next community call!
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