FAQ on Red Flag topic on Telegram channel on Nov 16


The first batch of question is from Alexander Tarasov @alexbelfas on Telegram channel

Code is basically a copy of the KOVAN testnet, without any of the network traction Ethereum has.

Network level of POA Network based on Parity client by Parity Technologies and AuRa consensus used in Kovan. That software is open source under GPL v3 license. We have modified version of Parity client and Consensus. AuRa consensus allows third parties to extend consensus algorithm. We added to main features to it:

  • workflow how to start a new network (Ceremony)
  • self-governance of validators (Governance)

Also, we tested that model on our testnet with all participants of the process. Here is the test network with Ceremony passed and Governance tested. It’s live, healthy, and ready to run smart contracts.

The testnet (be that Kovan or Oracles POA Network), by nature, is not expected to have a traction comparable to the mainnet.

Allegations that Ethereum’s transaction costs are high is not true, while the the coming transition to POS will provide a better alternative to the POA proposed.

I year ago tx cost on Ethereum network was 30 times less than it is now. POA token price is ~ 0.077 $ a token. Ethereum is $333 a token. Numbers speak for themselves.

There is no known published emission model for POS model and I can’t compare to it. I remember Vitalik’s tweet about it

The team vaguely states that POA provides cheaper and faster platform, without demonstrating how, and without specifying how much of the decentralization and trustlesness of the model is being sacrificed.

For demonstration of speed and price of tx please look at my answers above.

The system is trustless. Alice and Bob can exchange transactions without risk of altering by an intermediary (validator). Validators can’t change the content of transactions. Risks with censorship described in the white paper.

For more info on POA parameters and how it makes facilitates cost-efficiency, you can check out Parity GitHub: https://github.com/paritytech/parity/wiki/Proof-of-Authority-Chains

The POA consensus mechanism assumes Validators should be notable people with a reputation to uphold. Loss of this reputation is the only incentive to behave truthfully. This definition does not apply to the current validators mentioned, as they are not prominent figures in the crypto-community. The mere status as public notary does not immune the person from malicious behavior.

All validators are in the same jurisdiction. Which is good to protect token holders from possible fraud. It also allows new type of consensus with legally recognizable hard fork decisions

Notary requirement is good for our consensus with identity at stake because it proves that a validator has no criminal record.

Regarding “notable people with reputation to uphold”, it is semantic misunderstanding. Identity here means correspondence between a validator’s personal identification on the platform with officially issued documentation for the same person, i.e. certainty that a validator is exactly who that person represents to be. We are not alluding that validators need to maintain respect in the blockchain community or be famous for any reasons. See link below explaining POA in more detail.

There are prominent figures in the crypto-community who are criminals by trade:

would we like to see these prominent figures from crypto community as validators in PoA network :thinking:

Validators get all block reward AND HAVE NO INCENTIVE TO SHARE IT WITH THE NETWORK. Basically a get rich-quick scheme for Validators.

Validators receive 2.5% of network emission per year for all validators. In main Ethereum network, it’s more than 15%. In POA network it’s 7.5 times less tax for users of the net tokens for shared security.

It is not clear if the token sale is for the platform itself of ICO wizard.

The token sale is for POA Network. ICO Wizard is a technical tool to conduct ICOs. We give it for free to the community.

IGOR BARINOV’s most recent project https://www.blocknotary.com/ seems like a dead project. Considering that Oracles Network was name NotaryCoin before May 2017 (As per roadmap), it seems that this project is a continuation of blocknotary.

Block Notary, Inc. is a company founded by Igor Barinov. Team and ideas we had at Block Notary is a starting point for POA Network.
Block Notary is not dead and has contracts with US and European banks for novel blockchain enabled identity verification software. The license is exclusive for a specified period of time, which explains why we are not marketing it much.

One of the team members PAVEL X is anonymous.

Yes. Some people would like to keep their privacy. Although, you can reveal his identity and work on the project here:

Also, there are more contributors on POA Network Github then on the website.

At best 20% of the whitepaper is dedicated to the base protocol, while the remaining 80% is dedicated to Dapps.

Whitepaper created few month ago. You can observe our progress in protocol development in our blog posts

There is no real incentive to deploy dapps on the on oracles network instead of the Main Ethereum chain.

Our partners found it interesting. Check out thoughts of BitClave

and Musereum

There is no guarantee that as ethereum evolves, compatibility will be maintained with oracles network.

Token distribution states that 75% of the proceeds will be allocated to R&D. To be Ethereum-compatible network is our priority.

We formalized this concept of Ethereum compatible networks as Ethereum 95. To have Ethereum-like systems

  • fast
  • inexpensive
  • compatible
  • interledger ready



Code is basically a copy of the Kovan testnet, without any of the network traction Ethereum has.

Don’t tend the think in terms of “traction” but rather feature set and opportunity. The Kovan network was a solution developed by Parity to the denial of service attacks on the Ropsten testnet. If you think about this malicious activity on Ropsten it is really a denial of development/innovation on Ethereum, as a subset of developers couldn’t test their code/ideas/innovations. As testnet, KOVAN and thus Oracles Network have the same feature set of Ethereum, most notable smart contract support. So any contract developed on Kovan/Oracles Network is also Ethereum compatible.

Also, Ethereum is a new platform, maturing rapidly and hitting up against some huge challenges namely, complexity, scalability & throughput and ecologically unsound. Frankly, it is kind of stuck. Also the way forward for Ethereum is very precarious as Plasma, the most prominent proposal I am aware for these issues, is a least a magnitude more complex ( a destabilizing factor ), hard to implement, test and get right. Also, complexity tends to provide cover for malicious actors makes it more difficult to detect and identify them. Further there is no explicit timeline or commitment for the implementation of Plasma. So what’s next?

In addition to the base Ethereum feature set, Kovan PoA/Oracles Network provides:
-radical simplification
-faster more reliable block generation ~5s/block
-higher throughput
-ecologically more sound ( read energy efficient and cheaper )

This feature set exists now, represents value/opportunity and an incremental step forward given current state of Ethereum. I believe it should be explored, developed and tested on real world use cases.