To Your Questions
A blockchain can be described simply through its name, but first, let's look at its concept. Simply put, a blockchain is an open digital ledger that processes and records transactions.
Decentralized applications, commonly referred to as dApps, are applications that run on a decentralized network. With blockchain running on a network of nodes instead of centralized servers, applications built on them operate in a decentralized environment. This allows them to be accessible by participants on the network, provides transparency, and ensures that data and transactions are not owned by one governing authority.
A smart contract is compiled computer code running on a blockchain that establishes rules on which two or more parties can agree. If and when the pre-established rules are followed, the agreement is automatically enforced. A smart contract facilitates, verifies and enforces the execution of agreements or transactions between parties with divergent interests, without intermediaries and while eliminating the need for trust, unlike with traditional contract terms where contracting parties will incur the costs and risks of trusting one another or an intermediary while exchanging goods or services.
XDC Foundation was formed in 2021 to support the growth, development and adoption of the XDC Network by collaborating with an informed and active community of developers, world trade experts, and content creators. XDC Network is an open source technology designed to support those who utilize blockchain to more efficiently store and exchange data, assets, and ideas.
Community is the lifeblood and foundation of the XDC Network. Community can be anyone interacting with and contributing to the XDC Network in any way. This can be users, developers, entrepreneurs, enterprise, supporters, and any participate that contributes to or builds on the network. Each community participant plays a role in a network's success, and each role has different needs from the ecosystem to successfully contribute.
The XDC Network is an enterprise-grade, EVM-compatible Layer 1 network equipped with interoperable smart contracts. A highly optimized, bespoke fork of Ethereum, the XDC Network reaches consensus through a delegated proof-of-stake (XDPoS) mechanism, which allows for two-second transaction time, near zero gas fees, and over 2,000 transactions per second (TPS).
As an EVM-Compatible, Layer1 blockchain with smart contracts, the XDC network can support a large collection of token standards. These include XRC20, XRC721, and XRC1155 imported from Ethereum as well as native standards that allow you to deploy and handle multiple types of tokens within your smart contracts. The tokens can act as units of account for applications that reside on the XDC Network.
The XDC coin, or simply XDC, is the native asset of the XDC protocol and may serve as the reserve cryptocurrency for all third-party dApps running on the XDC Network. As a coin, it unlocks functionality on the XDC Network, powering a wide range of novel use cases:
XDCPay is XDC's native wallet that stores XDC Coin and XRC tokens, including tokens you created. It allows you to run dApps right in your browser and allows you to pay the low gas costs for transactions on the XDC Network.
XDC Network’s primary block explorer is BlocksScan. It lets you see all network transactions and block activity. You can verify contract code while also allowing users to find transaction details and more for any account on the XDC Network.
The XDC Network’s operation relies on Masternodes which are operated by third parties. Some operators have set up multiple Masternodes; XinFin Fintech operates three Masternodes which it set up originally to run the Network at inception, whereas XDC Foundation does not operate any Masternodes. Each Masternode falls into one of three subcategories: Validator, Standby, or Archival.
ISO 20022 is an international standard for financial messaging that financial institutions will migrate to as a common language for cross-border payments messaging.
Metcalfe's Law states that the value of a given network is proportional to the square of the number of connected systems. In other words, a network increases in value exponentially faster than the additional sum of the value of all additional parties involved.
Trade finance is the financing of a purchasing transaction between a buyer (importer) and a seller (exporter). There is time in transit from the point of sale to the delivery of the goods purchased, and this is typically what trade finance covers. For example, a bank may provide a guarantee to the seller on behalf of the buyer that promises to make the seller whole should the transaction fall through due to the buyer’s lack of payment.
A Letter of Credit (L/C) is one common trade finance product and involves a bank pledging payment on behalf of the buyer (importer) to the seller (exporter). The seller’s bank becomes involved once the L/C is issued by the buyer’s bank, and the seller’s bank will typically issue a loan to the seller based on the guarantee provided by the L/C.
SME is an acronym for small-to-medium size enterprises. SMEs include women and minority owned businesses. The term is often used in the trade finance industry as the market segment is often precluded from participating in trade finance opportunities due to a high bank rejection rate — 50% or more. Reasons for the high rejection rates include SMEs lacking collateral requirements, creditworthiness, and knowledge about trade finance. Banks often lack the resources to extend credit to and audit SMEs.
As banks have well-established lending patterns with their clients, there are capital needs that go unmet in the trade finance sector. The trade finance gap happens when there is more demand for capital than there is capital available.
Trade finance is broadly considered to be a low-risk asset class. The nature of financing and guaranteeing payment for products being shipped between exporters and importers has proven to produce very little risk over long periods of time.
Traditionally, large investment banks have been the providers of trade financing for the global trade industry. The complex and centralized nature of the financing products offered disincentivized other non-bank financial institutions, although the secondary market created by the banks for off-loading their initial investments was more diverse.
Tokenizing trade finance can include, but is not limited to, issuing regulated notes and security tokens that are backed by trade finance assets on a distributed ledger. These security tokens reside on the blockchain and may be traded on exchanges.
The International Trade and Forfaiting Association (ITFA) was founded in 1999 as a worldwide trade association for companies, financial institutions and intermediaries engaged in global trade, forfaiting, supply chain and receivables financing. Its members work together to originate and distribute trade-related risks. XDC Network was invited to become the first and, at the time of writing, only Layer 1 blockchain ecosystem member.
There are a number of factors that make XDC Network “enterprise-ready.” The term reflects how the network is scalable, cost-effective and developer-friendly. When enterprises are executing a high volume of transactions on XDC Network, they will pay minimal fees and won’t face burdensome network congestion. When selecting a blockchain network, enterprises may also actively seek a history of stable performance - which XDC Network demonstrates.