Aptos is a blockchain network designed to address the reliability, scalability, availability, and security issues that plague existing L1 chains.
Aptos originated from the Libra project launched by Facebook in 2019, but Libra suffered from repeated policy resistance due to its overly ambitious dream of issuing a global stablecoin. The Libra project was later restructured and renamed Diem, which became an open-source blockchain project. In 2021, Facebook Inc. changed its name to Meta, and it announced that Diem was acquired by Silvergate Capital Corporation.
After the confirmation of the acquisition, some of the original Diem team announced that they would try to relaunch the project as Aptos, which inherits many of Diem’s features, such as the Move language, the Diem consensus mechanism, and parallelized processing technology. But the focus of Aptos is no longer on the payment network, but on the smart contract platform.
Website: https://aptoslabs.com
Twitter: https://twitter.com/aptoslabs
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Medium: https://aptoslabs.medium.com
Github: https://github.com/aptos-labs
Aptos was co-founded by Mo Shaikh and Avery Ching. They and several other team members were part of the founding team of Diem. Avery Ching worked at Meta’s Novi cryptocurrency subsidiary prior to founding Aptos and is the co-creator of the DiemBFT consensus protocol for the Diem blockchain. Austin (@austinvirts) is the former head of marketing at Solana and currently serves as the Director of Ecosystem at Aptos Labs. The team also boasts many experienced designers, analysts, engineers, and more.
According to public information, Aptos has received 2 rounds of funding and raised $350 million. The details are as follows.
Aptos has now published an overview of the tokenomics. The initial supply of APT tokens is 1 billion, with unlimited inflation at a later stage.
The initial token allocation scheme and unlocking plan are shown below.
As you can see from the graph, only the foundation and the community have the initial tokens during the first 6 months of APT’s listing. The community will release 125M tokens and the foundation will release 5M tokens. The article states that some tokens have been allocated to projects built on the Aptos protocol and will be granted upon completion of certain milestones. The author tentatively interprets it as these tokens are currently in a locked state. According to this token allocation method, some of the 125M tokens initially allocated to the community may also be in a locked state, and the community will receive a smaller number of tokens in circulation. Moreover, the rewards for early test users are also locked and there are no airdrops. So, first, the earliest tokens are very scarce; second, there may not be a low percentage of tokens that the foundation can control in the earliest period that can be circulated. And with all the major exchanges scrambling to get APT tokens on their shelves, there is a great demand for tokens from market makers, potentially pushing up the price of the coin in a short period of time.
Here’s a look at the circulation of tokens afterwards. After some projects complete their milestones, tokens are released, which will increase the supply. In addition, there is an interesting sentence in the official summary of the economic model: both unlocked (distributable) and locked (non-distributable) tokens can be staked. This means that locked tokens belonging to eco-projects, foundations, communities, and investors can also generate staking proceeds, which will actually generate more tokens and more selling pressure by the time they are unlocked. At that time, it is possible that the impact on the price will be slightly larger than expected.
Currently all the transaction fees of Aptos are destroyed, which can reduce the inflation rate to some extent. But it doesn’t necessarily mean its inflation rate can be as low as ETH, it depends on how prosperous the on-chain applications are. The long-term value of L1 chain tokens depends on its technical advantages and ecosystem building, and having applications that can retain users is the way to go. We will analyze this part later.
Aptos has three main technical highlights, which are the Move programming language, parallelized processing technology and DiemBFT consensus scheme.
In the blockchain world, programming language, as the formal language that defines computer programs, is the basic vehicle to achieve all the functions and systematic goals. The move was once hailed as the most suitable language for blockchain. The chart below briefly compares the characteristics of the three programming languages; innovations in security, parallelization, and development friendliness of the Move language are also detailed and analyzed in the following.
Move outperforms previous programming languages in terms of asset security, in large part because targeted improvements are made based on achievements from previous projects. We have discussed the security features in detail in our past report, Move innovations and opportunities, and a summary of the report is as follows.
Move provides comprehensive security screens for smart contracts at several levels: language design, virtual machine, contract invocation and contract execution. Move specifically defines a new resource type for digital assets to distinguish them from other data, and combines the strong data abstraction feature of Module to ensure that assets will not be created out of thin air, copied arbitrarily or discarded implicitly, which greatly elevates the level of security. At the same time, Move is designed to support only static calls, and all contract execution paths can be determined at compile time, fully analyzed and verified, so that some security vulnerabilities could be revealed in advance, thus reducing the probability of system downtime. Moreover, it introduces formal verification tools, which greatly reduce the cost of manual code security audits.
Solidity does not support concurrent processing; yet, Move aims to alter this feature from the ground up. Since it creates a special definition for digital assets, it distinguishes them from ordinary values in terms of data type, and by defining different properties for various resources, independent transactions can be identified with the assistance. Combined with the multi-threaded execution engine, transaction data can be operated and processed simultaneously, improving the efficiency of system operation.
According to market feedback, Move is rather developer-friendly: its main purpose is to lower the security threshold for development so developers of smart contracts can focus on business logic. Meanwhile, as Move is evolved from Rust and Solidity, discarding unnecessary “dross” in the design of both, its complexity is relatively low. Therefore, the overall switching cost for developers is not high. According to Move practitioners, developers with experience in Rust and Solidity programming will only take 1–2 days to be adept at Move; for developers without experience in smart contract programming, it only takes 1–2 weeks to learn Move from scratch.
Aptos inherits the core features of Move. It retains security and flexibility, with some special designs based on its own project characteristics. It introduced the adapter layer to extend the additional functionality of the core MoveVM, including parallelism via Block-STM that enables concurrent execution of transactions without any input from the user, massive storage in accounts, tables for storing keys, and decoupled finefine-grainedrage that decouples the amount of data stored in an account affecting the Gas Fee for transactions associated with the account.
Most current mainstream blockchains engage EVM as the execution engine. When processing transactions, EVM executes one transaction at a time, keeping all other transactions on hold until the transaction is completed and updated to blockchain state before executing the next transaction in turn. This pattern of execution is one of the major bottlenecks in network throughput.
Besides having more advanced hardware to speed up the execution, the main solution to such a problem is parallel computing. A similar scenario once appeared during the development of modern computers. While most computers from 20 years ago had only 1 CPU core, CPUs with 4, 8 or even more cores are commonplace today. It is through more cores for parallel computing that the processing capacity of computers has been continuously improved over the years.
Parallel computing refers to the decomposition of an application into multiple pieces on a parallel machine, assigned to different processors, so that the execution of the subtasks can be processed in parallel by each processor in collaboration with each other, thus achieving the goal of speeding up the solution, or solving larger scale problems. In blockchain, parallel execution of transactions disrupts the paradigm of sequential execution of transactions by simplifying the connection of operations, sequencing, and dependencies of transactions to execute unrelated transactions simultaneously in order to enhance the system’s throughput. The parallel machine is the verifier/node in the blockchain.
On top of that, parallel computing can also reduce the cost of nodes and improve the decentralization of the system, as it disobeys the general diffusion law of computers to not engage in parallel computing if the same level of performance is desired, which could be more costly when using a more powerful single-core CPU.
Aptos draws on the concept of parallelization. It was designed with the idea of separating unrelated transactions and executing them by advanced execution engine and hardware simultaneously. This idea is closer to how current blockchains operate; this is demonstrated in the following 3 main methods.
â—Ź The simplest case: simultaneous execution of transactions in different threads that do not overlap in terms of data and accounts. For example, Alice transfers 100 XYZ tokens to Bob and Charles transfers 50 UVW tokens to Edward at the same time; the two transactions can be processed simultaneously.
● Slightly more complex case: If there are multiple requests pointing to the same data or account, the transactions will first be processed in parallel, only then will behaviors that are potentially subject to conflict be handled in the right settlement order (referred to as delta writes), and a result can therefore be confirmed. For instance, if Alice transfers the same token to Bob and Charles consecutively, the 2 transfers will first be processed in parallel, and a check will be conducted as to whether the overall change in Alice’s account is reasonable. If the balance is insufficient, the process will back trace to the former transaction and re-execute.
â—Ź Most complex case: Transactions can be reordered across one or more blocks to optimize concurrency of execution. For example, if an address receives multiple receipts or transfers at the same time, these transfers can be distributed across multiple blocks. This may cause delayed confirmation of transactions for some users, but it allows for greater concurrency for other transactions at large and improves the overall performance of the network.
Aptos employs the Block-STM (Software Transactional Memory) parallel execution engine for transactions. Unrelated transactions are executed simultaneously on different cores on the same CPU, maximizing parallelism by multiple instruction streams and multiple data streams for transactions.
The Aptos whitepaper demonstrates the performance test of Block-STM concurrency control: with 10,000 accounts in presence, a TPS of 160,000 can be achieved with 32 threads, and the advantage of parallel execution is significant when a large number of accounts are competing for trading space.
Here we give an example to compare the difference between Ethereum and Aptos. Assuming each network is a city, and each city has 8 points of interest. A user submitting a transaction can be viewed as arriving in the city via a flight, and a confirmed transaction is deemed as being when the user arrives at his desired point of interest from the airport.
Ethereum’s practice is to load a bus with passengers until the vehicle is full. The bus will circle around the 8 points of interest and drop all passengers off one by one.
Aptos has the ability to complete the same task by starting off with eight buses, and passengers with different destinations can go straight to their desired destinations without any prior stops. Due to more advanced hardware, the Aptos buses also faster than the Ethereum buses, which saves even more time.
Blockchain’s dedication to performance is never-ending, and Aptos also has the idea of introducing sharding in the future. If it can be successfully implemented, it is not impossible to achieve Alipay’s ultra-high throughput of 500,000 transactions per second during the peak period of the Double Eleventh Day.
One last thing to be noted is that parallelized computing cannot solve all problems by simply adding the number of cores and processing by classifications and categorizations. Aptos, Sui and other future L1 chains are by no means just payment networks, they will also have to carry many dApps and smart contracts. The existing smart contracts are only suitable for serial execution, such as AMM and NFT minting. The ultimate power of parallel computing can only be unleashed when smart contracts approximate parallel computing on algorithms. Developers need to adapt smart contracts, where there is a lot of fundamental work that takes some time and accumulation.
The Aptos consensus mechanism is a direct continuation of the DiemBFT scheme. Diem’s consensus comes out of HotStuff, a three-stage voting BFT consensus where nodes do not need to communicate with each other in each round, and only need to submit their votes to the master node. The DiemBFT consensus makes several detailed improvements, one of which is the addition of a memory pool, which is equivalent to adding an actual storage layer, a change that greatly improves the performance of the system.
A feature of DiemBFT is a reconfiguration mechanism for the voting power of consensus nodes, which we can regard as a BFT incorporating the POS mechanism. Each verifier does not have equal voting power and needs to be weighted according to its equity, which is proportional to the number of tokens it staked. At the same time, DiemBFT shares transaction information with each other through a shared memory pool protocol and then votes in rounds, which is similar to HotStuff. DiemBFT combines the characteristics of the BFT mechanism of reaching consensus quickly and having deterministic results, and also allows more users to participate through equity staking, which enhances the decentralization of the project.
The process and content of Aptos’s consensus are somewhat different from that of the general blockchain. The transaction communication and the consensus phase are separate, and verifiers only need to reach a consensus on the metadata of the transactions (metadata). In other words, Aptos’s block contains only transaction metadata instead of actual transaction data. This is completely different from the traditional block structure, as shown in the figure below.
The following section explains how the consensus was reached.
After transactions are collected and verified by a verifier, a certain number of transactions or transactions within a certain period of time are packed as a batch, which gets transmitted repeatedly in verifiers’ network. The verifier cannot tamper with the batch after distributing it, and other verifiers accept and store this batch, while signing the summary of the batch and sending the signature back to it. When 2f+1 (weighted calculation, f being the weight of the false verifier) verifiers have signed the batch summary, the system generates a proof of availability (PoAv). PoAv guarantees that at least f+1 weighted honest verifiers have already stored this batch of transactions, so all honest verifiers can retrieve it before execution. (This assumes f number of false verifiers submitted signatures in the previous step, but later deleted the transactions which means at least f+1 honest verifiers still retain the transactions). As a result, the block can be generated without containing the actual transactions: the nodes proposing the block only need to sort and pack a few batches of metadata along with PoAv to produce a block. After other verifiers validate the PoAv and the block metadata criteria (e.g., proposal timestamp, block expiration time), they can vote on whether the block is legitimate or not.
Aptos evenly distributes the demand for bandwidth during the consensus phase over a longer period of time. This enables the consensus to be performed while using minimal bandwidth (because the consensus process requires a small amount of data for block metadata and PoAv to be transferred), resulting in high transaction throughput and minimal latency. The consensus in DiemBFT V4 is fast, typically requiring only two round-trips in the network, with a full round-trip time of less than 300 milliseconds. Since 2019, DiemBFTv4 has been extensively tested by dozens of operator nodes and multi-wallet ecosystems in multiple iterations, and by a total of 3 test networks of Aptos. Its stability should therefore be assured.
Through these technical innovations, Aptos has achieved a significant increase in performance, and the maximum TPS can reach 160,000, far exceeding other mainstream L1 chains.
For blockchain, both technical advantages and ecosystem building are crucial. Aptos’s ecosystem building can be said to have started well.
Focusing first on the developer ecosystem, Aptos organized an offline hackathon in May this year, inviting developers from Stanford, Berkeley, Google, and Facebook to participate. 12 project demos emerged as winners, including DEX, wallets, NFT marketplaces, and even games. An ecosystem funding program was launched on June 29th to provide funding for teams, individuals and creators to accelerate ecological development. Funding categories include: developer tools, SDKs, libraries, documentation, guides, and tutorials; tools and frameworks for development, governance, DeFi, and NFT; core protocol contributions such as token standards, libraries, protocol upgrades, etc.; open source and public products; educational initiatives; and applications.
Through these activities, Aptos has brought together a group of developers. Developers see new technologies emerging, and they themselves want to be the first wave of participants in the ecosystem to reap the early dividends of the ecosystem. The aptos-core repository on Github already has over 15,000 commits, 2200 fork and 4000 stars. this code commit count has reached 75% of Solana’s, which was launched 3 years before Aptos, indicating that developers are actively building and that the explosion of on-chain projects may be imminent The explosion of on-chain projects may be imminent.
In terms of the project ecosystem, near the main web launch, there are already over 200 projects covering DeFi, NFT, the gaming space and more looking to deploy on Aptos. Tutorials for interacting with the Aptos ecosystem of projects are everywhere, and it can be expected that Aptos will be able to quickly gain a group of users.
The Aptos project was born with the aura of Libra and has a strong team with top talent in both technology and operations, and is well equipped in its own right. Aptos is appreciated by capital and it reserves enough funds for project development and realization, motivating developers and users, responding to unexpected situations, etc. It also has excellent external conditions.
In terms of the economic model, due to the small supply of circulating tokens at the beginning of the launch and the major exchanges scrambling to get them on the shelves, the coin price may have a large increase in the short term. Supply and demand will then return to equilibrium as tokens are unlocked and staking incentives are released.
The more detailed tokenomics of Aptos(APT) are unclear. In a bear market, designs that more tangibly give value to tokens are needed to give confidence to the market to buy them. When the overall market turns warm and the on-chain ecosystem booms, the tokens may gain as much ground as the new L1 chains of 2021.
On the technical side, it relies on Move language, parallelized design and more efficient consensus mechanism to achieve extremely high performance while ensuring security and scalability. Ecology building is also its strong point. It has brought together a group of active developers through hackathons, developer rewards programs, etc., while more than 200 projects are waiting to be launched on Aptos’ main website. It is reasonable to believe that quality projects are likely to emerge from these projects, which will continue to attract and retain users for Aptos.
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