Validators play an important role in participating in the consensus mechanism of the Celo Platform. They help secure the Celo network and act independently to verify transactions and propose blocks to add to the blockchain. In addition, the amount of value passed through mobile phones is growing each year, even without cgld coin digital assets being accounted for. In many of the poorest regions of the world the mobile phone has unintentionally become a “leapfrog” technology. For example, even though many of these areas have never had fixed line telephones, or dial-up internet, they are now saturated by cell phones and other mobile devices.
- Rather than using complex, long strings of letters and numbers as blockchain addresses, users of Celo are able to send and receive cryptocurrencies using their mobile phone number.
- Celo is currently using a Byzantine Fault Tolerant consensus algorithm where a defined set of validator nodes are used to reach agreement on the validity of transactions posted to the network.
- Users can create cUSD by sending $1 worth of CELO/cGLD to the Celo Foundation reserve.
- In 2018 alone there were an estimated $136 billion in cash transactions conducted via mobile money agents.
And by using the mobile phone in its design it has found one way to make cryptocurrencies more approachable and understandable for the average person. This could be just the thing to drive massive adoption in the coming decade. The Celo Foundation is continuing this transition by creating the Alliance for Prosperity. They are responsible for protocol changes, providing security audits, and supplying the hardware and software necessary to keep the network running.
The three co-founders of Celo are Sep Kamvar, Rene Reinsberg, and Marek Olszewski. The three share the responsibility of running the project through cLabs. If you would like to know where to buy Celo at the current rate, the top cryptocurrency exchanges for trading in Celo stock are currently Binance, OKX, Bybit, DigiFinex, and Bitget.
Celo is a carbon-negative, permissionless blockchain that supports the CELO governance asset and other ERC-20 Mento stable assets, which may be used to pay for transaction fees. Importantly, Celo is also one of the world’s first [carbon-negative] blockchains. Its proof-of-stake consensus mechanism requires a small fraction of the energy used by proof-of-work chains. The Celo community’s commitment to the planet goes even further, as an integral partner in the Climate Collective, an expanding coalition of companies building at the intersection of Web3 and climate action.
Steve has been writing for the financial markets for the past 7 years and during that time has developed a growing passion for cryptocurrencies. For storage Celo has released a wallet, however it is currently only available for Android devices. There is also a third-party Chrome extension, however it has no reviews and very few users, so install it at your own risk. Any validators that don’t act in the best interests of the network can be penalized economically. Plus, since the validators are elected by Celo holders, any validator that doesn’t act in the best interests of the community can be replaced by the votes of the community.
In the future the team has said they will expand the stablecoin offerings to the cEUR and cGBP among others. In the case of Celo these fees are for transactions that get sent to the full nodes. Because the network becomes more efficient when there are more nodes, there needs to be a way to incentivize folks to run a full node.
Celo Simplifies Blockchain Transactions
The nodes are also considered gateways to the network and they forward transactions and requests from the light nodes to the validators. In a network like Celo, where most of the nodes will be light or ultralight mobile wallet nodes, it is important to have a robust level of full nodes in place to service the light nodes. Celo is a proof-of-stake (PoS) layer 1 blockchain network complete with a virtual machine that facilitates smart contract and decentralized application (dApp) development and deployment. The Celo ecosystem can be used to issue stablecoins, such as cUSD, via an algorithmic stablecoin collateralization model. The Celo Dollars or cUSD are the Celo stablecoin that is meant to enable stable transfer of value between users. It is backed by reserves of other digital assets like Bitcoin and Ethereum and is pegged to the price of the U.S. dollar.
This consensus method can reach agreement on the validity of transactions even when one-third of the nodes are malicious, faulty, or offline. When the wallet is created the mobile number is linked to a wallet address and a cryptographic hash of the phone number is stored on the blockchain. It’s really a simple process, and you can even try it out for yourself using the Celo developers wallet and the Alfajores Testnet. The Celo team simplified the user experience by getting rid of the clunky public keys on the user side and replaced them with the mobile phone numbers that most of us are used to. They are also far easier to remember and to type into a form as an address.
These are ERC-20 tokens that were sold in Dutch auction on Coinlist on May 12, 2020. Outlets such as Coinbase also received cGLD tokens at the time as a payment for their early investments into Celo. The cGLD tokens were unlocked when the Celo mainnet launched and can be exchanged for CELO or for cUSD. There is a small fee that’s charged to the account to verify the phone number, but this is not a big deal with the testnet since the wallet comes prefunded with 10 cUSD. And if you continue using the wallet you can always top it up from the Celo faucet.
In addition to being compensated they also hold governance properties that steer the network and protocol in the best direction as deemed by the community. One downside to the validator network is the cost of running a validator node, currently estimated to be over $15,000. Still, that’s quite inexpensive when compared with Cosmos for example, where it requires 10,000 https://cryptolisting.org/ ATOM (over $50,000) to become a validator. The Celo team consists of dozens of individuals from all over the world and from multiple disciplines that include software development, blockchain engineering, marketing, business, finance, and others. It’s this broad, deep experience base that has recommended Celo as one of the top projects to watch in the blockchain space.
We tried it out to see if it really worked as advertised by the Celo team and found that it truly is a simplified way to interact with a blockchain and cryptocurrency. After installing the wallet and linking a mobile number the app sends a code via SMS to the mobile number. The user inputs that code into the wallet app and the system begins to synch the wallet and the mobile device. Voting on protocol changes is also done by locking up CELO in the same smart contract. Again, the voters are able to recall their CELO after a waiting period of three days has elapsed.
What Makes Celo Different From Other Networks?
There are many other successful blockchain projects using PoS consensus and these include Cosmos, Tezos, and Algorand. And in the near future Ethereum will also transition to become a Proof-of-Stake blockchain. While the Celo app is the preferred way to send Celo Dollars (cUSD), the platform’s stable coin, it is not needed. Users can send cUSD via WhatsApp if they like, however in order to receive the cUSD the recipient will need to download and install the Celo wallet (currently available for Android only).
Using mobile phone numbers as addresses also allowed the team to develop a blockchain with far lower resource usage when compared with many modern blockchain solutions. This low resource design is key for increasing usage in areas where resources are scarce. The team at Celo made the decision to use the mobile phone because it is so ubiquitous and understood. While some areas of the world haven’t received the cabling for internet or even for landline phones in 2020, the people that live in these areas do have mobile phones in many cases.
Celo aims to make cryptocurrency accessible by establishing a completely decentralized payment system that creates wallets with users’ mobile phone numbers, streamlining the onboarding process. While Celo appears very simple for the users, on the backend it is just as technically sound as any competing blockchain project. Built using the Go implementation of Ethereum, Celo uses a Proof-of-Stake consensus algorithm.
The good news is there are no costs for running a node other than the electricity used to run the machine the node is installed on. Not just that, but the amount of value now being passed using mobile devices is growing every year. In 2018 alone there were an estimated $136 billion in cash transactions conducted via mobile money agents.