Wanchain Cross-chain smart contract and financial platform

Wanchain aims to create a new financial services industry centered around digital assets using cross-chain interoperability, privacy, and smart contract functionality

Background

Wanchain is an open source project that is attempting to build a distributed blockchain based financial market. The team plans to achieve this goal through three pillars; cross chain interoperability, privacy, and smart contracts that give anyone the ability to create or access a suite of applications. Wanchain imagines use cases such as decentralized exchanges, lending, stablecoins, multi-currency payment and settlement, crowdfunding, and many other financial services will be facilitated on the network. The project was created in 2016 by Jack Lu, former co-founder, and CTO at Factom. Wanchain is currently being developed by the Wanchain Foundation, a non-profit organization registered in Singapore.

The project focuses on the growth of digital assets, including tokenization of traditional assets like stocks and bonds, and how they will interact with existing blockchains like Bitcoin and Ethereum. Wanchain plans to build a common framework, including cross-network interoperability, which will allow these different assets and their native ledgers to interact with each other. Initially, the team will focus on integration with Ethereum and plans to include interoperability with any public or private blockchain network.

Users can choose private transactions through the use of one time addresses, and the team plans to integrate ring-signatures, like those in Monero, in future releases. This is designed to provide the ability to transact privately and provide increased fungibility of assets.

Wanchain also runs an accelerator program called WANLab which seeks to support projects that are building on the Wanchain platform. To date, six projects have been picked for this accelerator program and will receive mentorship and resources from WANLab. Wanchain is part of the “Blockchain Interoperability Alliance,” alongside the AION and ICON projects. The goal of this alliance is to promote interconnectivity between different isolated blockchain networks.

Technology

Wanchain is a fork of Ethereum and integrates similar smart contract capabilities. The platform uses proof-of-stake (PoS) for consensus but divides verification nodes into three groups; vouchers, storemen, and validators.

Nodes are required to stake Wancoin (WAN) in return for the ability to validate transactions on the network. They are compensated in the form of fees for this service. Any dishonest behavior causes their stake to be slashed. The platform aims to
facilitate cross-chain interoperability using a series of locked accounts. When sending a cross-chain transaction, assets (value) are not flowing across chains. Instead, they are sent to a locked account that keeps funds on the original chain, akin to a deposit.
Vouchers provide proof of transactions between the original account and the locked account.

Funds are then replicated on Wanchain, and a receipt is generated, showing how much a user can transact with. Locked accounts are created through a cryptographic method called secure multi-party computation (sMPC), which allows for coordination using a public-private address scheme. Storemen are responsible for operations related to locked accounts such as account generation and key management. Private keys are not
exposed to a single individual during this process, but instead, are divided amongst multiple validators requiring some, or all, to reconstruct the data. This aims to also maintain network integrity if some of the validators are corrupt or offline.

Validators are general verification nodes that record transactions whenever there is consensus. By dividing the nodes into three distinct groups, the team hopes to reduce the chance of collusion.

Wanchain uses one time accounts and plans to use ring signatures to protect anonymity and fungibility in the network. Privacy can be provided for simple transactions (sending tokens from one wallet to another) and more complex operations with smart contracts and cross-chain requirements.

In Wanchain, every account has a main account that contains sub-accounts or one-time accounts. When a sender initiates a private transaction, they create a unique account for the recipient based on their public key. The sender sends the money to this one-time account instead of the public address. The recipient can then use their private key to access all their onetime accounts.

Ring signatures are a type of digital signature in which a group of possible signers are merged to produce a group signature. The sent transaction is mixed with a series of past transactions that act as a decoy, to prevent anyone from identifying the actual sender. Ring signatures obfuscate the sender while one time accounts
obfuscate the receiver.