Unveiling REN Protocol (REN): Bridging Different Blockchains with RenVM

In the ever-expanding landscape of decentralized finance (DeFi), the Ren Protocol emerges as a groundbreaking force, reshaping how we perceive and utilize blockchain interoperability. Ren, formerly known as Republic Protocol, aims to foster a seamless exchange of assets across decentralized ecosystems. This article delves into Ren Protocol’s inner workings and examines its potential to create a more interconnected and collaborative DeFi space.

What is the Ren Protocol?

Source: https://www.coinclarified.com/p/what-is-the-ren-protocol-the-rise-of-universal-interoperability/

REN protocol (formerly known as Republic Protocol) is an open protocol enabling the permissionless and private transfer of value across different blockchains. Ren protocol operates to facilitate the transfer of various crypto assets from other blockchains to Ethereum, thus enabling its users to access DeFi products without selling any assets.

With Ren Protocol, users can lock their digital assets like Bitcoin in a smart contract in exchange for the equivalent Ethereum. This format allows users to take advantage of Ethereum’s defi applications like Aave and Compound without purchasing new Ethereum tokens or making use of a bridging protocol. Ren Protocol’s vision is to create an open, interoperable, and decentralized web by allowing any application to access any asset on any chain.

History of Ren Protocol

Ren Protocol was founded in 2017 by software developers Taiyang Zhang, a venture partner with Alameda Research, and Loong Wang, who is also a founding member of Rook (formerly known as KeeperDAO). They were classmates at the Australian National University and worked together at the same start-up after graduation.

The beta mainnet was launched in 2018, and the platform rebranded to Ren in 2019. Before the beta launch, the project held an initial coin offering (ICO) and raised up to $34 million.

How Does Ren Protocol Work?

Ren protocol’s primary role is to act as a custodian for digital assets while they are moved between different blockchains. As such, it secures the assets and generates corresponding tokens on the destination blockchain. It achieves this through a user-friendly interface and smart contracts known as RenERC20s that act as bridges between blockchains. These “RenERC20s” are compatible with the ERC20 token standard and ensure that the value of other chains’ native tokens remains the same after conversion.

For example, if a user wants to convert their BTC, the Ren Protocol Virtual Machine (RenVM) will hold the BTC and create an ERC-20 token called the renBTC on the Ethereum blockchain with a 1:1 ratio. Due to this, the value of renBTC will always be equal to BTC. This process can be extended to almost all digital assets and smart contract systems, including native tokens such as Dogecoin and the Polkadot blockchain. As a result, the platform simplifies interactions between different blockchains for developers and users.

Main Features of REN Protocol

Ren protocol serves as a pillar of interoperability, enabling the movement of digital assets between different blockchain networks in a trustless and secure manner. The protocol was designed with innovation and versatility in mind and offers features that collectively redefine the landscape of decentralized finance (DeFi), including the following.

RenVM

The RenVM (Ren Virtual Machine) powers the Ren ecosystem and enables the creation of Ethereum-based ERC20 tokens representing cryptocurrencies at a 1:1 ratio. Users can then burn their tokenized assets to redeem their locked assets. Since Ren Protocol is a decentralized, permissionless, and trustless custodian that can lock assets on-chain and mint them individually, RenVM is the engine that powers this approach.

RenVM is made up of thousands of nodes called Darknodes. These darknodes are a network of computers that earn rewards for contributing to the network’s computing power and storage space. Virtual machine technology allows one computer to run multiple “VMs.” These decentralized virtual machines spread over thousands of computer and working in sync provides significant scalability for the platform. As compensation for their work, the Darknodes earn a share of the transacted volume through the RenVM network.

Anyone can run a Darknode, but each node must run the RenVM software via a Virtual Private Server and deposit 100,000 REN tokens (about 2.679621 ETH) into the Darknode Registry Contract. This serves as an incentive mechanism for the node operators to refrain from malicious behavior at the risk of forfeiting their deposit. Darknodes are also randomly arranged into groups called shards once daily, and this process fortifies RenVM against attacks on the network by constantly moving and regenerating potential data targets.

RenVM uses advanced technology to facilitate a smooth exchange and simultaneously protect the privacy of users, and some of these technologies include:

Shamir’s Secret Sharing

This cryptographic principle divides secret data into parts held by different participants. Ren protocol uses this process to securely store private keys used in the Ren network, even from the Darknodes themselves.

Secure Multiparty Computation (sMPC)

This algorithm enables developers’ code to run without disclosing any input or output. sMPC reveals the infinite possibilities of sharing data privately between competing parties so they can cooperate and gain mutually beneficial insights from that data. It provides a solution to the growing issue of privacy and data collection.

Byzantine Fault Tolerance (BFT)

BFT is an algorithm that allows the Ren network to function optimally regardless of whether some nodes stop working. This helps prevent system failures and false transactions, thus increasing the overall reliability of the platform.

RenBridge

RenVM accepts tokens from one blockchain during the swapping process and generates new tokens on another through RenBridge. The RenVM will then hold the original funds in storage, reversing the process when the user wishes to retrieve their bitcoins.

Ren 2.0

Source: https://medium.com/renproject/introducing-ren-2-0-43025b3d5d6

Ren protocol is invested in the mass adoption of Bitcoin as a global revolution in monetary policy. The project seeks to achieve this through a state-of-the-art interoperability protocol designed to cater to Bitcoin users’ trust and security needs and decentralized financial markets. Ren 2.0 brings support for the Binance Smart Chain in addition to Ethereum operability.

Ren 2.0 has expanded to incorporate several assets across smart contract chains, including Arbitrum, Polygon, and Solana. This multichain support facilitates interoperability between different ecosystems in the crypto industry.

In addition, the protocol received two significant upgrades. First, the direct bridging of renASSETS between smart contract chains was enabled, allowing for a faster and cheaper transfer process. Second, the updated protocol allows for generic tokens, including stablecoins and native assets like ETH, to be moved between these smart contract chains.

What is REN?

This is the native token of the Ren ecosystem and powers its smooth running. It serves two principal functions: firstly, to pay trade fees for any orders made on RenVM and next to pay bonds to the Registrar, a smart contract running the Darknodes in the Ren ecosystem.

Unlike other crypto projects, users don’t need to buy or hold REN to access the platform. Instead, they pay fees in the native blockchain token through which they’re handling their trading activities. For instance, if a specific user wants to access the Ren platform using renBTC, they would have to pay the transaction fee in Bitcoin during conversion.

Ren Tokenomics

REN has a total and circulating supply of 1 billion REN and a market cap of up to $51.09 million. The token was distributed as follows:

• 65.2% was sold to investors, with 56.6% being sold in a private sale and 8.6% in a public sale
• 5% was allocated to community development and partners
• 9.9% went to the Ren team and advisors
• 19.9% went into the company reserve

Ren Foundation

On September 25, 2023, Ren announced the launch of the Ren Foundation, an independent non-profit organization committed to the research and development of trustless blockchain interoperability. It will support the research, development, growth, and awareness of the Ren protocol. It will also support implementations of the Ren protocol and its third-party developer and application ecosystems.

Source: https://twitter.com/renprotocol

Ren’s first version lost its development funding when Alameda Research acquired its initial development team and later filed for bankruptcy. However, its first director, David Perkins was able to raise a 285,000 USDT grant from the Ren community to develop a decentralized staking protocol to generate more rewards for node operators without taking any fees from other stakers.

The Ren Foundation’s immediate focus is on the research and development of the Ren v2. Most interoperable projects lack support for Bitcoin because of its scripting limitations, but the Ren Foundation plans to double down on it.

Is Ren a Good Investment?

Ren protocol facilitates trustless and secure cross-chain asset transfers, allowing users to move digital assets between blockchains seamlessly. However, it must be noted that the cryptocurrency market is quite volatile, so every investor is advised to do extensive research and consult qualified financial professionals before investing in REN.

Take Action on REN

REN is available for purchase from both centralized and decentralized exchanges, including gate.io. Check the REN price here and begin trading your favorite pairs.

• REN/USDT
• REN/ETH