10 State Channel Projects Every Blockchain Developer Should Know About

What are State Channels and why should I care

The whole world is going through a blockchain revolution. But people familiar with blockchain know that it’s not going that well. One of the greatest problems with blockchain today is its poor scalability, which is stopping blockchain to be accepted in the mainstream. It still takes several minutes to get a transaction confirmed which sometimes makes people lose their shit.

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Currently, 2 types of solutions are being worked upon to tackle this problem: side chains and state channels. You can go to the below article if you are interested in side chains and how it is different from state channels.

11 sidechain projects every blockchain developer should know about_The whole world is going through the blockchain revolution. But wait…is this really what we dreamed of? Present…_hackernoon.com

Difference between SideChains and State Channels - vasa - Medium_A complete comparison of the two scaling methods. State Channels and Sidechains are the two terms in Ethereum community…_medium.com

But, here we are going to explore 10 state channels. So let’s get started!

1. Lightning Network

Status: Live

Type: payment channel(can scale payments only)

Lightning is a decentralized network using smart contract functionality in the blockchain to enable instant payments across a network of participants.

It is dependent upon the underlying technology of the blockchain. By using real Bitcoin/blockchain transactions and using its native smart-contract scripting language, it is possible to create a secure network of participants which are able to transact at high volume and high speed.

Features

• Instant Payments: Lightning-fast blockchain payments without worrying about block confirmation times. Security is enforced by blockchain smart-contracts without creating a on-blockchain transaction for individual payments.
• Scalability: Capable of millions to billions of transactions per second across the network. Capacity blows away legacy payment rails by many orders of magnitude. Attaching payment per action/click is now possible without custodians.
• Low Cost: By transacting and settling off-blockchain, the Lightning Network allows for exceptionally low fees, which allows for emerging use cases such as instant micropayments.
• Cross Blockchains: Cross-chain atomic swaps can occur off-chain instantly with heterogeneous blockchain consensus rules. So, as long as the chains can support the same cryptographic hash function, it is possible to make transactions across blockchains without trust in 3rd party custodians.

Lightning github | Lightning telegram | Lightning reddit

2. Raiden Network

Status: Not Live

Type: payment channel(can scale payments only)

The Raiden Network is an off-chain scaling solution, enabling near-instant, low-fee and scalable payments. It’s complementary to the Ethereum blockchain and works with any ERC20 compatible token. The Raiden project is work in progress. Its goal is to research state channel technology, define protocols and develop reference implementations. It’s ethereum version of Lightning network.

Features

• Scalable: Scales linearly with the number of participants.
• Fast: Transfers can be confirmed within a subsecond.
• Private: Individual transfers don’t show up in the global shared ledger.
• Interoprable: Works with any token that follows Ethereum’s standardized token API (ERC20).
• Low fees: Transfer fees can be orders of magnitude lower than on the blockchain.
• MicroPayments: Low transaction fees allow to efficiently transfer tiny values.

Raiden github | Raiden telegram | Raiden reddit

3. Trinity

Status: Not Live

Type: payment channel(can scale payments only)

Trinity is a universal off-chain scaling solution, which aims to achieve real-time payments, low transaction fees, scalability, and privacy protection for mainchain assets. Using state channel technology, Trinity will significantly increase the transaction throughput of bottom layer chain. It’s neo version of Lightning network.

Features

• Private payment channel: As a privacy-conscious network, Trinity adopts multiple technologies like zero-knowledge proof to protect data security and enhance privacy protection for users.
• Lightning fast speed: State channels allow multiple transactions to be made within off-chain agreements with exceptionally fast processing and the final settlement on-chain.
• Open protocol: Developed entirely as an open source protocol architecture, future developers are able to create their own interface utilizing the Trinity technology.
• Settlement Onchain: Via final settlement on-chain, Trinity ensures security of state channels and fulfills its role of decentralization by broadcasting the settlement amount to the entire network.

Trinity github | Trinity telegram | Trinity reddit

4. SpankChain

Status: Live

Type: generalised state channels(can scale payments and smart contracts)

A cryptoeconomic powered adult entertainment ecosystem built on the Ethereum network. Their payment channel is live on Ethereum mainnet, and the state channels are being worked on. They even did their token sale on the state channel! According to the whitepaper:

The SpankChain token sale will be conducted through a custom, single-round, blind, dutch, state channel auction system which eliminates blockchain network congestion and also allows our team greater flexibility to determine the price and quantity of tokens sold.

SpankChain github | SpankChain Twitter | SpankChain Medium

5. Perun

Status: Not Live

Type: generalised state channels(can scale payments and smart contracts)

The Perun Network is a framework that supports off-chain protocols for simple payments and generic smart contract off-chain execution. Perun’s channels can be virtual, which means that off-chain transactions do not require interaction with intermediaries thereby further reducing trust, latency and costs. In additional Perun offers strong security guarantees backed up by scientific methods from cryptographic research. It is funded by Vitalik Butrin, Ethereum Foundation, L4.

Features

• Highly scalable: The Perun’s channel virtualization eliminates intermediaries thereby offering nearly unlimited scalability.
• Provable secure: The security of Perun is mathematically proven using state-of-the-art techniques from cryptographic research.
• Privacy enhancing: Since Perun eliminates interaction with the middleman, Perun’s channels naturally enhance privacy.
• Cost efficient: Perun reduces costs for executing smart contracts and payments by cutting off the middleman.
• Lightweight: Perun uses lightweight cryptography and can be used on almost any platform, e.g., for machine-to-machine communication.
• Flexible: Perun enables completely novel applications by supporting generalized state channels.

Perun github

6. Counterfactual

Status: Not Live

Type: generalised state channels(can scale payments and smart contracts)

Counterfactual is building generalized state channels on Ethereum. The idea behind state channels is that we can make blockchains more efficient by moving many processes off-chain, while still retaining a blockchain’s characteristic trustworthiness.

Their focus is on long-term possibilities of the Ethereum project/blockchain technology, researching and developing novel techniques for state channels that increase privacy; have support for parallel operations; provide verified, audited, and expertly optimised components; and that establish clear standards for how all of these generalised state channels will fit together into a global, multi-blockchain network where any user can easily connect to any other.

Presently, they are focused on internally progressing the framework to an abstraction that makes developing “channelized” applications easy and intuitive.

Counterfactual github | Counterfactual reddit | Counterfactual Medium

7. Celer Network

Status: Not Live

Type: generalised state channels(can scale payments and smart contracts)

It is a coherent technology and economic architecture that brings Internet scale to existing and future blockchains through off-chain scaling techniques. It can scale out to billions of trust-free, secure, and private off-chain transactions per second. Celer Network is on a mission to fully unleash the power of blockchain and revolutionize how decentralized applications are built and used.

Features

• cStack: Layered architecture with clear abstractions and interfaces. Reduces complexities in the system design, development and maintenance. Enables rapid evolution of each individual component.
• cChannel: Generalized state channel and sidechain suite. Supports fast state transitions with generic dependency DAG on networked channels. Flexible constructs to maximize liquidity utilization.
• cRoute: Provably optimal value transfer routing with transparent channel balancing. 15X higher throughput compared to state-of-art solutions. Fully decentralized with high failure resilience.
• cOS: Development framework and runtime for off-chain enabled applications. Provides common design patterns, and handles the operation, storage, tracking, and dispute of off-chain states.
• cApps: Application ecosystem running on Celer Network. Scale out to billions of private off-chain transactions per second with no compromise on trust or decentralization guaranteed by the blockchains.
• eEconomy: Cryptoeconomic model that provides network effect, stable liquidity, and high availability for the ecosystem. Includes proof of liquidity commitment, liquidity backing auction, and state guardian network.

Celler Telegram | Cellar Twitter | Celler Medium

8. Machinomy

Status: Live

Type: payment channel(can scale payments only)

Machinomy allows the devices to pay and earn money. See your car paying for gas, and for a weather report, and for a regular maintenance. Take a look at your fridge. It is going to buy fresh vegetables while you drive. Allow the devices to care about you. Allow them to transfer money in autonomous and secure way.

An idea behind Machinomy project is to allow any device to pay another device a minuscule amount of money over the internet. In short: to provide a viable means of exchange for machine economy. Current implementation is a Node.js package. It represents a somewhat constrained vision: allows a device to instantly pay a fraction of Ether over HTTP, no trust established. Actually, the device is a networked computer able to run geth and Node.js. A server or your laptop qualify, as well as Raspberry Pi board.

Features

• Nearly zero fees
• Immediate payments
• Simple API
• Any device

Machinomy github | Machinomy gitter | Machinomy Twitter

9. FunFair

Status: Beta Live

Type: generalised state channels(can scale payments and smart contracts)

FunFair provides blockchain-powered solutions with the potential to profoundly change the online gaming industry for both the operator and player. Using the latest Ethereum technology, we deliver low cost, high quality, transparent casino experiences that are provably fair.

Funfair reddit | Funfair telegram

10. Liquidity

Status: Live

Type: payment channel(can scale payments only)

The Liquidity Ecosystem provides (1) blockchain payments for everyone with the off-chain Liquidity.Network and (2) the Liquidity DEX, a non-custodial off-chain exchange.

Liquidity github | Liquidity telegram | Liquidity medium

Updated List

11. Connext Network

Their aim is to make dApp user experience easy for everyone, so that the user doesn’t even realize that they are using blockchain. According to their article:

Plasma(a sidechain) is awesome, we recognize that it is a mechanism most effective for handling n-party ecosystems (n>2).

So, they come up with state channels to solve the above issue. But as we know that state channels are only useful(economically) if the transacting parties transact multiple time within single state channel creation. In order to solve this they have come up with concept of state channel hubs.

They aim to make the concept of state channel approachable to all and in a much easier way, so that you don’t have to hire a state channel expert to implement it. According to their article:

In the same way that Loom has made Plasma approachable, we hope to make state channels easy to implement for every project. We aim to do this by collaborating closely with both existing applications and other approaches to scaling, to create one seamless developer experience.

Connext github | Connext twitter | Connext medium

Want to add your project here? Shoot a comment and I will consider adding your project here. Or you can ping me on twitter here.

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The world today has seen the first glance of what we call blockchain, but the only way to harness its true power is to make it scalable. And projects like these are trying to make it happen.

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