Meta’s defunct Diem project spawns 2 new blockchains

This article is part of Crypto Insights, a segment by major crypto exchange Bybit that dives into the latest and most pertinent issues in the crypto space.

“The bear is for building,” as they say, and much is happening at the roots of crypto. From the ashes of Meta’s fallen Diem project two new blockchains are rising, headed by former Diem engineers.

This year, Sui and Aptos have caught the attention of crypto enthusiasts and venture capitalists alike. Both have raised over US$300 million from industry bigwigs like Andreessen Horowitz and FTX Ventures at multi-billion dollar valuations.

Mo Shaikh and Avery Ching, who co-founded Aptos, worked on Meta’s Diem project, which was nixed by regulators who opposed the release of a dollar-pegged stablecoin. The five-person team behind Sui also worked on Diem, though it and Aptos are not collaborating.

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There are still many similarities. Both use the new Move coding language, which was originally developed for Diem. It’s based on Rust, the language of the Solana and Near blockchains, which means Move could provide an easy onboarding process for developers familiar with that code.

Without going into the granular details, Move has sought to solve some of the problems with Ethereum’s Solidity code by using parallel processing. In other words, unlike existing blockchains that have the bottleneck of needing to order every transaction sequentially, Aptos and Sui can execute various transactions simultaneously without needing to reach a global consensus on the state of the blockchains.

Furthermore, both Sui and Aptos support sharding as a scaling solution, which is not unique as Ethereum is doing the same. However, it allows the new chains to create specialist shards that take advantage of different storage solutions or focus on a particular set of transactions, which allows for further efficiency.

All this has allowed Aptos to report a speed of up to 130,000 transactions per second (TPS), with Sui not far behind at 120,000 TPS. However, these speeds were achieved in a devnet environment and, in the case of Aptos, focused on execution only and didn’t include the consensus process.

To put those numbers into perspective, these speeds are about double Solana’s figure of 65,000 TPS, which is one of the fastest blockchains currently. (I should mention that Solana has a “theoretical limit” of 710,000 TPS, which is possible if technology improves as the Solana team expects.) Meanwhile, Ethereum is lagging behind with a mere 15.7 TPS. However, as the chain is upgraded, developers expect it to exceed 100,000 TPS.

Image credit: Timmy Loen

Also, the consensus mechanism of Aptos automatically updates validator rotations and carefully manages how well nodes perform in terms of uptime and honesty. Aptos is aiming for a more efficient system than other proof-of-stake blockchains, which randomize the nodes that collect fees and don’t take past performance into account. “The chain distributes rewards based on the node performance,” said an Aptos developer in the firm’s Discord server.

Both chains also expect to be fully decentralized by allowing all comers to operate nodes on their blockchain in a similar way to current platforms. However, it takes time to attract developers and node operators, so it may be a while before these new chains could compete with Ethereum in terms of how decentralized they are.