Ethereum Foundation has announced a US $ 5 million grant for the technology start-up Parity Technologies. Parity Technologies is a high-performing member of the larger Ethereum ecosystem, and the company is making significant progress on several high-focus strategic areas vis-a-vis the Ethereum blockchain network.
The move from Ethereum Foundation clearly demonstrates that the foundation is serious about collaborating with partners that add value to the Ethereum ecosystem. The grant also shows how the foundation is keen to facilitate and aid stakeholders that show demonstrable progress on strategic projects.
To understand the significance of the grant, we need to understand the strategic initiatives of Ethereum Foundation and their importance. This will help us in appreciating the value that Parity Technologies brings on the table.
Public permission-less blockchain networks like Bitcoin and Ethereum provide a high degree of decentralized security, thanks to the ‘Proof of Work’ (POW) consensus algorithm. However, POW is energy-hungry since it requires a high amount of computing power.
Bitcoins’ high energy consumption continues to attract negative press. At a time when the crypto market is undergoing a sharp contraction, such adverse publicity can further hurt the market. Ethereum is planning an ambitious transition to the ‘Proof of Stake’ (PoS) consensus algorithm, which doesn’t use excessive energy.
Ethereum Foundation accords a high priority to this transition. Parity is making fast-paced and significant progress on the PoS algorithm, therefore, their priorities align well with the foundation.
The Ethereum project team is working on their planned ‘Casper protocol‘ for this transition to the PoS algorithm. It will help in scaling the Ethereum network significantly, and it’s an important project for Ethereum. Parity is making key contributions to the Casper protocol, that too at a rapid pace.
The transition to PoS will also help the Ethereum project to bring in further scalability improvement measures. Sharding is one such measure. Sharding involves horizontal partitioning of the blockchain network.
Nodes in one shard will have visibility to the data in that shard only, therefore, each node doesn’t load the entire data in the blockchain network. Since the POW algorithm requires the participation of all nodes in transaction validation, sharding can’t be implemented in conjunction with this algorithm. It requires the PoS algorithm, where every shard will have its’ own set of transaction validators.
Sharding is increasingly a focus area for the Ethereum project, especially with the prevailing bearish crypto market trend. Parity is making rapid progress in this area too, which further aligns their work with the strategy of Ethereum Foundation.
Parity already has their ‘Parity Ethereum Client‘, which has a reputation of being fast and highly advanced. The company is working on WebAssembly (Wasm), and this project is also progressing rapidly.
Ethereum Foundation supports research, development, and education to improve the Ethereum platform and promote it further. The grant to Parity fits well with their mission.
Ethereum Foundation has announced the grant in a blog post. Parity has their offices in Berlin, Germany. They also have offices in London and Cambridge, in the UK. In addition to being a recognition of the work that Parity is doing, the grant from the foundation is likely to aid the company in fast-tracking their important projects. Watch this space for more exciting news from Parity!