Komodo founder and core developer James ‘jl777’ Lee posted a Declaration of Independence on 21 Feb 2016 emphasizing the asset holder’s need for cross-chain atomic swaps between various chains, and a standardized protocol facilitating such swaps. Komodo is a fork of the Zcash code that utilizes a consensus mechanism called Delayed Proof of Work (dPoW) involving a time-stamping UTXO type blockchains to the Bitcoin mainchain, and, in so doing, secures the transactions prior to the timestamp. The SuperNET iguana client is under active development. The team seeks to realize an efficient bitcoin core implementation that simultaneously supports multiple implementations of the Bitcoin blockchain. This architecture is designed to support atomic swaps of assets in the Komodo network; where either the entire transaction as both parties anticipate it is completed, or not at all, this helps prevent the creation or destruction of any global token supply across the various ledgers.
Many small or early blockchain projects have significant security concerns compared to more established chains with vastly greater hashpower, such as Bitcoin. Komodo’s product offering aims to address this issue. Delayed Proof of Work (DPoW) applies to Unspent Transaction Output (UTXO) type blockchains. It works by taking a block hash of the customer blockchain and saving it in the OP_RETURN field on the KMD chain before, at ten minute intervals, a Komodo block hash is committed to the Bitcoin blockchain. This effectively enhances the security of all transactions prior to this block, since re-writing anything in the ledger will require rewriting the Bitcoin blockchain as opposed to just re-writing the transactions on a chain with a significantly lesser hashrate.
Komodo requires a network of 64 Notary Nodes (NN), which comprise a peer-to-peer network and perform the DPoW consensus procedures. These Notary Nodes keep full copies of the Bitcoin, Komodo and all DPoW blockchain in the network, so have significant hardware requirements of the order of 64Gb RAM, 1Tb of storage and a 100Mb/s internet connection. This architecture facilitates straightforward atomic swaps between tokens within the Komodo exchange and its peer-to-peer network supports a trustless, decentralized exchange of such tokens.
Notary Node operators have significant responsibilities to the network, therefore need to have thorough understandings of network security principles and the inclination to demonstrate best practice. To ensure operator quality, there is a voting mechanism whereby users can approve of or reject these crucial network actors. Since there is not a staking component to setting up a NN, the Komodo team view them as meaningfully distinct from Master Nodes in other networks, which arguably imply various plutocratic centralization risks by giving disproportionate influence to those holding many tokens, or those able to acquire many tokens.
The Komodo network’s native token, KMD, enables private transactions, is tradable for assets in the Komodo blockchain ecosystem and is used in paying DEX transaction fees, which are of the order of 0.15%. Komodo’s ICO was held in late 2016 and raised $1.9 million USD in exchange for 90% of the 100 million KMD tokens minted. The KMD token also confers voting rights for Notary Node operators. As of early 2019, the Komodo network held two annual elections to determine who will run these mission critical nodes. Token holding votes only determine half of the NN cohort, however, as the top 30 Notary Nodes, measured by successfully completed notarizations, were re-elected automatically.