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Due to its flexibility, Ethereum is one of the most popular blockchains for developers. However, Ethereum does have some downsides, such as its lack of privacy. ARPA Network hopes to solve this problem by adding privacy-preserving smart contracts to the Ethereum ecosystem. What does this mean for users, and how will it affect the blockchain? Here's what you need to know about the new ARPA Network.
Key Takeaways:
ARPA Network’s recent origin dates back to a white paper released in late 2022 by Penrose Tech. This Singaporean development duo was already well-known in blockchain spaces for developing Bella Protocol, a blockchain asset management platform, and they released the ARPA chain in 2019 as a way to provide general purpose multiparty computation.
While working with blockchain systems, Penrose Tech noticed there was an increasing need for data privacy on the Ethereum blockchain. Penrose Tech decided to take the theory of their ARPA chain and apply it to Ethereum.
After a few months of development, the ARPA Network testnet was released in the spring of 2023. The system worked well for testers and was launched on the Ethereum mainnet on Jun 21, 2023. Since then, it’s attracted many users and has been involved in countless transactions.
ARPA's main focus is data privacy. Ethereum does a lot of things well, but it's not necessarily designed to protect users' confidentiality. As an open-source public blockchain, it's very easy for people to track things like how much money a user is receiving or what types of transactions they’re involved in. ARPA is designed to obscure the identities involved in transactions.
There have been a few other attempts at creating a privacy-preserving computation network based on the Ethereum system. However, ARPA's creators aim to provide privacy without compromising on things like highly scalable infrastructure. Their innovative solution prioritizes decentralization, flexibility and security. Users can customize signature policies, process their signatures through multiple nodes and verify signatures cryptographically. Unlike some other platforms, ARPA Network lets people maintain secure and separate data utility without having to turn over a lot of their personal information to a third-party system.
The main process behind ARPA Network is secure multiparty computation (SMPC). Multiparty computation (MPC) is a cryptographic computational sharding process that lets multiple parties manage a computation without being able to see each other's data synergies. When users create transactions, MPC simultaneously processes proxy smart contracts from multiple entities without sharing which information is connected with each signature.
The other key mechanic used by ARPA Network is Boneh-Lynn-Shacham (BLS) digital signatures, a cryptographic method for verifying authentic signatures. BLS signatures can confirm that a signature is accurate, with a separate data utility that allows for convenient random number generation.
ARPA Network runs on a dual-layer structure. Its protocol layer builds a foundation for the entire network to run on. This decentralized, permissionless protocol layer uses computational sharding to connect autonomous nodes that provide computational power, data utility and security. The second layer is a computational layer that can collaboratively analyze data and perform the SMPC process.
Accurate nodes receive ARPA tokens as a reward for loaning their computational power, while malicious nodes are penalized and forfeit their security deposit. This ensures transactions are processed in a secure and timely manner.
Due to its unique design, ARPA provides features beyond its privacy-preserving computation network. Even those who don't need confidential proxy smart contracts can benefit from working with ARPA Network. As advertised, its other beneficial features include the following.
Anyone with the right hardware can choose to become an ARPA Network node and collaboratively analyze data. To do so, stake a minimum of 500,000 ARPA tokens as a security deposit and then agree to perform BLS tasks. In return, you earn rewards in five different ways:
ARPA token holders can stake ARPA within the community pool by locking ARPA tokens for a minimum of 14 days. The maximum staking limit is 2.5 million ARPA coins at a time. Depending upon how long you stake your coins, you can earn an impressive amount of rewards.
ARPA Network also makes it possible to run Randcast, a system designed to generate random numbers for other decentralized apps (DApps) and off-chain networks. It harnesses the BLS nodes and can extract data synergies to provide valuable services to other web3 organizations. Through Randcast's data utility services, people can generate the random numbers needed to maintain security, run gaming apps on off-chain networks, and produce digital advertising for NFT collections.
ARPA has already achieved many of the goals set out on its original road map. After refining the SMPC process, they released a devnet in late 2022, a testnet in early 2023 and launched the mainnet in mid-2023. Alongside completing the main ARPA road map in a timely manner, the company has also worked on and launched Randcast as a secure and inexpensive way of randomly generating numbers.
Now that the main ARPA Network is up and running smoothly, ARPA is looking to the future for more applications for its highly scalable infrastructure. They hope to spend the rest of 2023 designing and launching a new version of staking that includes user delegation and nomination mechanisms. From there, their plan is to expand community governance, start 2024 with additional systems for running the ARPA community and expand their services to other blockchain networks.
ARPA is the utility token for the ARPA Network. The ARPA coin is used for community governance and provides rewards for nodes that help create privacy-preserving smart contracts.
The ARPA coin has a maximum and total supply of 2 billion coins, but only 982 million are currently in circulation. ARPA Network plans to gradually release more tokens into the circulating supply to increase volume without causing inflation. As of Sep 4, 2023, ARPA’s market cap is $41 million, with a 24-hour trading volume of approximately $14.8 million.
The current price of the ARPA token is around $0.04249601 (as of Sep 4, 2023), which is significantly lower than the highest price paid of $0.268622. Despite being down from that apex, many still believe ARPA is likely to increase in value. Data analysis from CoinCodex suggests that prices may remain somewhat stable for 2024 and increase to around $0.125059 in 2025. If everything goes well for ARPA Network, the coin has the potential to reach up to $0.30 in the future.
ARPA tokens are primarily used for managing the ARPA system. You can purchase them from crypto exchanges such as Bybit, which offers the ARPAUSDT Perpetual Contract. Get started by creating an account, funding it with cryptocurrency and navigating to the ARPAUSDT Perpetual Contract trading page.
As one of the only ways to privatize data on Ethereum blockchain networks, ARPA Network certainly has a lot of promise. However, the ARPA coin is more of a utility token than an investing token. Fortunately, since the node operators ARPA relies on to extract data synergies are paid with ARPA, the company has an incentive to keep ARPA token values high and trading volume low. This means that it's a fairly stable investment.
Prices may not skyrocket, but they're unlikely to plummet in value either. Ultimately, ARPA tokens are likely to be a solid inclusion in any investment portfolio. Of course, it’s recommended you still do your own research before choosing to invest in any cryptocurrency, including ARPA.
ARPA Network's solution to Ethereum's privacy issue provides users with a secure, flexible and scalable way to prevent multiple entities from accessing their transaction data. Furthermore, the unique ARPA node system uses data synergies to provide random number generation services for a variety of other companies. Altogether, this is an exciting web3 project with numerous potentially useful applications.
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