Venture capital (VC) firm Paradigm is leading a major $225 million funding round for a new Layer 1 (L1) network, which aims to compete with ethereum (eth). block chain. Other notable participants include venture capital firms Electric Capital and Greenoaks.
According to a recent Fortune magazine report, Monad Labs, the company behind the blockchain project, aims to compete with established players such as Solana (SOL) and ethereum and the Layer 1 Sui (SUI) blockchain protocol.
Monad Rebuilt ethereum Blockchain
According to him crypto/2024/04/09/monad-paradigm-greenoaks-jump-crypto-funding-225-million/” target=”_blank” rel=”nofollow”>report, Monad's initiative is to rebuild the ethereum blockchain from the ground up, while retaining the ability to execute smart contracts. The project aims to achieve faster transaction speeds, handle higher volumes and offer lower costs compared to existing networks.
In particular, Monad ensures compatibility with ethereum's programming infrastructure, known as ethereum virtual machine (EVM). This compatibility allows developers to port applications built for ethereum, ensuring a smooth transition to the new blockchain.
Keone Hon, founder of Monad, stated in an exclusive interview with Fortune that the company has spent approximately two years developing its blockchain solution.
Hon noted that Monad Labs stands out for being fully compatible with the EVM bytecode standard. Developers use this standard to create decentralized applications (dApps) on platforms such as ethereum, Polygon, Avalanche, Binance Smart Chain, and Optimism.
According to Avichal Garg, Managing Partner at Electric Capital, almost 90% of developers working in various crypto ecosystems focus exclusively on EVM chains.
This statistic, highlighted in a recent Electric Capital report, demonstrates the significant appeal of EVM Compatibility. Although Monad does not undergo a complete redesign of its programming language like other blockchains, it still benefits from the widespread use and familiarity of the EVM.
Blockchain-powered exchanges?
According to the report, Monad plans to launch its mainnet by the end of the year and hopes to launch a testnet in the coming months. The company, which currently employs about 30 people, also intends to launch a native tokenalthough no details of its launch with the main network have been revealed.
While Keone Hon emphasized the pursuit of widespread adoption, he noted that Monad's initial use case is likely to be “high-frequency” trading, based on his own experience at Jump Trading, a data- and research-driven trading company.
Hon emphasized the need for a high-performance blockchain to enable exchanges on the scale of Nasdaq or Chicago Mercantile Exchange (CME), which process millions to billions of daily transactions.
Lastly, Hon also highlighted the potential of a blockchain with high transaction capacity and low fees to enable various applications, such as gaming. He cited examples where blockchain-based games, such as RuneScape, require frequent updates to player statistics, requiring fast, low-cost transactions on the blockchain.
At the time of writing, eth was trading at $3,497, down almost 5% in the last 24 hours.
Featured image from Shutterstock, chart from TradingView.com
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