Introduction

QUBIC (Quorum-Based Computation) is a cryptocurrency platform trying to innovate blockchain technology through a new approach to mining and consensus mechanisms, integrating transaction validation to advance the field of artificial intelligence (AI). Instead of the traditional Proof-of-Work (PoW) system used by many cryptocurrency protocols, QUBIC applies a concept called Useful Proof-of-Work (uPoW), which works by taking advantage of the computational power that is used in mining for an additional purpose: training AI models. This dual functionality is supposed to secure the network while contributing to advancements in AI research.

QUBIC was founded by Sergey Ivancheglo, a notable figure in the cryptocurrency space, who also co-founded IOTA and NXT. His work on IOTA, known for its Tangle technology, and NXT, one of the first proof-of-stake blockchains, has laid a strong foundation for QUBIC’s approach.

What is QUBIC (QUBIC)?

Qubic is a Layer-1 blockchain that has introduced a new variation of the Proof-of-Work (PoW) consensus mechanism in blockchain, called “Useful Proof-of-Work” (UPoW).

In traditional PoW blockchains, the miners in that system will compete to solve complex mathematical problems to validate transactions that, in turn, provide a more secure network for all involved in that ecosystem. When it comes to UPoW, this protocol employs a different approach to mining, directing the computational power from miners towards a very specific purpose: advancing Artificial Intelligence (AI) research through tasks that improve the training of the platform’s artificial intelligence model.

What is Qubic’s “Useful Proof-of-Work” Protocol?

As mentioned before, Qubic introduced a variation of the Proof-of-Work (PoW) consensus mechanism called “Useful Proof-of-Work” (UPoW), which directs miners’ computational power toward advancing Artificial Intelligence (AI) research.

An important part of how the protocol achieves this goal is using Aigarth, an AI program within the Qubic blockchain. To validate transactions and make a profit, miners in the network are not tasked with solving complex cryptographic puzzles; instead, they are requested to perform a series of computational challenges that are, instead, designed to train and develop Aigarth. These challenges may involve several tasks, such as pattern recognition, data analysis, or complex problem-solving, all contributing to enhancing Aigarth’s capabilities for the ultimate benefit of the protocol.

By solving these tasks, miners can simultaneously achieve two goals: securing the network by validating transactions and directly contributing to the advancement of the AI program. This, in turn, creates a symbiotic relationship between blockchain technology and AI research.

The technical aspects of UPoW involve a designated workload distribution mechanism through which Qubic assigns the AI-related computational tasks to miners to optimize the overall training process for Aigarth. This might involve dividing tasks into smaller, more manageable units or prioritizing tasks based on Aigarth’s current learning needs.

The UPoW model may be considered a potential improvement over traditional PoW because it transforms the mining process into a more targeted and impactful activity. Miners contribute not just to network security but also to the development of a potentially powerful AI program.

However, it’s important to acknowledge that UPoW is a relatively new concept, and its long-term effectiveness in securing the network and advancing AI research remains to be seen. The efficiency of workload distribution, the effectiveness of the verification system, and the overall impact on Aigarth’s development all require further evaluation and real-world testing.

Key Features of Qubic

Quorum-Based Computation (QBC)

QUBIC uses a Quorum-Based Computation (QBC) system to ensure its network integrity and execute smart contracts efficiently. By applying QBC, 676 Computors, which are validators responsible for executing tasks within the network, execute smart contracts, maintain network integrity, and secure the blockchain by validating transactions, checking their authenticity and confirming that the sender has sufficient funds, and then ensuring the transactions comply with network rules.

Consensus Mechanism

For QUBIC to function properly, it needs a way for its Computors to agree on which transactions are valid and which may constitute a risk for the blockchain. It achieves that by following the steps below:

1. Transaction Proposal

A new transaction is proposed and sent out to all Computors in the network.

1. Independent Validation

Each Computor checks the transaction on its own. They verify that the transaction is authentic, that the sender has enough funds, and that it complies with the network rules.

1. Reaching a Quorum

To confirm a transaction, at least 451 of the 676 Computors must agree that it is valid. This agreement is known as reaching a quorum.

1. Finalization

Once a quorum is reached, the transaction is finalized and added to the blockchain. This method ensures that transactions are reliable and secure, as it would be very hard for any malicious party to manipulate the network without controlling many Computors.

QUBIC monitors and ranks its Computers continuously based on their performance. They are evaluated on their ability to process transactions quickly and stay in sync with the network. If a Computer isn’t performing well, it is replaced by a more efficient node. This system ensures that only the best computers are constantly involved in validating transactions, keeping the network faster and more reliable.

High-Speed Transactions

QUBIC smart contracts are written in C++ and executed directly on hardware, a method known as bare metal execution. This approach eliminates the need for a virtual machine, which can slow down execution. It maximizes computational efficiency and speeds up transaction processing.

QBC also ensures fast transactions by requiring only a quorum of 451 out of 676 Computers to agree on a transaction’s validity. This process reduces the time needed to reach consensus, allowing transactions to be confirmed more quickly.

QUBIC can also process up to 40 million transfers per second, offering high transaction throughput, the ability to handle a large volume of transactions simultaneously, and the ability to ensure that the network can support a high level of activity without delays.

Currently, QUBIC operates with an average block time of about 7 seconds. The network plans to reduce this to less than a second through scheduled upgrades to Compute nodes. Shorter block times mean new blocks can be added to the blockchain more frequently, further enhancing transaction speed and reducing latency.

Oracle Machines

Oracle Machines are essential components in QUBIC’s architecture, bridging the gap between the blockchain and real-world data, acting as intermediaries that fetch external data and feed it into the network. They interact with the Qubic Protocol Interface (QPI) to bring in different types of real-world information, such as stock prices, sports scores, weather conditions, and sensor readings, bringing important data for smart contracts that depend on accurate and timely information.

For instance, a smart contract might use stock price data to execute financial transactions based on market conditions or weather data to trigger insurance payouts in adverse weather. By providing this external data, Oracle Machines enable smart contracts to respond dynamically to real-world events.

The QUBIC protocol includes mechanisms for ensuring that the data supplied by Oracle Machines can be trusted. This involves using quorum-based consensus to agree on the validity of the data, similar to how transactions are validated in the network. By requiring agreement from multiple sources, the protocol minimizes the risk of inaccurate data affecting smart contract operations.

Integration with AI and Smart Contracts

Oracle Machines can be particularly helpful in integrating AI and smart contracts, by providing necessary data inputs for Aigarth, QUBIC’s AI component, allowing it to observe and respond to offline conditions. This integration helps develop advanced AI capabilities that can interact with and impact their decisions.

This can be particularly useful to real-life scenarios, such as:

1. Financial Markets: Oracle Machines can provide stock price data, enabling smart contracts to execute trades or manage portfolios based on market movements.
2. Insurance: Weather data from Oracle Machines can trigger insurance payouts for agricultural policies when certain weather conditions are met.
3. Supply Chain: Sensor data can monitor and manage logistics and supply chain operations in real-time.
4. Oracle Machines are fundamental to making QUBIC’s smart contracts practical and applicable to offline scenarios. By providing reliable, real-time data, they enable the creation of advanced, responsive smart contracts that can interact effectively with the external world.

Smart Contracts

As this article showcases, QUBIC’s smart contracts are distinctive from other blockchains. Every smart contract on the QUBIC platform must undergo a proposal and voting process by the Quorum. This helps ensure that only useful and legitimate smart contracts are executed, preventing the network from being flooded with unnecessary or malicious contracts.

Once a smart contract is approved, it is launched via an Initial Public Offering (IPO) of 676 shares. The QUBIC tokens spent to purchase these shares are locked into the smart contract, effectively reducing the circulating supply of QUBIC tokens. This mechanism also funds the execution of the smart contract, as the locked tokens are used to pay for computational resources.

This approach brings a few extra advantages:

1. High-Speed Execution: QUBIC’s smart contracts can process up to 40 million transfers per second due to efficient code execution and a robust consensus mechanism.

2. Feeless Transactions: The platform supports feeless transactions, making it cost-effective for users.

3. Decentralized Decision Making: The proposal and voting process by the Quorum ensures decentralized and democratic decision-making regarding which smart contracts are executed.

4. Sustainability: The funding mechanism through IPO and the continuous generation of fees ensure that smart contracts remain sustainable over time.

Feeless Transactions

One of the most interesting features of QUBIC is its support for feeless value transfers. Transactions are validated through a consensus mechanism involving votes from Computors, eliminating transaction fees, and supporting offline payment verification.

The Qubic Token (QUBIC)

The native cryptocurrency of the Qubic network is the Qubic Token ($QUBIC). It was designed to facilitate operations within the ecosystem and serves multiple purposes within the network, such as paying for smart contract execution, acting as a medium for transactions, and providing a means for users to participate in the network’s consensus mechanism.

$QUBIC is the only currency used to pay for the execution of smart contracts on the network. When a smart contract is launched, it undergoes an Initial Public Offering (IPO) where shares are purchased with $QUBIC. The tokens spent are then locked into the contract and used to fund its execution.

The platform supports feeless transactions, meaning users do not incur fees for transferring $QUBIC. However, executing smart contracts involves burning $QUBIC to sustain the network and contract operations, and prevent inflationary issues.

The Oracle Machines consume $QUBIC in their operations, ensuring that the data fed into the network is reliable and timely. Finally, there is the development and use of Aigarth, QUBIC’s AI component. It also consumes $QUBIC, which helps in its continuous improvement.

How QUBIC Works

Each seven-day epoch produces 1 trillion $QUBIC. The maximum supply is capped at 1000 trillion, and it is projected to be reached by the year 2041.

While this may seem like an overly large supply of tokens, this high cap eliminates the need for decimal points, which, in turn, simplifies calculations and enhances performance, contributing to a better user experience.

Tokenomics

QUBIC’s tokenomics is designed to balance supply and demand through multiple mechanisms:

Emission

New $QUBIC tokens are created every epoch, adding to the circulating supply. The network emits 1 trillion $QUBIC weekly, contributing to a final maximum supply cap of 1000 trillion tokens.

Burn Mechanisms

Within the QUBIC ecosystem, $QUBIC functions like energy units rather than conventional currency. This usage model aims to maintain the network’s sustainability and efficiency.

Several burn mechanisms are in place to reduce the circulating supply of $QUBIC. These include the burning of tokens used in smart contract IPOs and fees associated with smart contract executions.

Main Advantages for Users

• Feeless Transactions: Users benefit from feeless transactions, making the platform cost-effective for transferring value.

• Passive Income: Shareholders in smart contract IPOs earn passive income through the fees generated by smart contracts.

• Sustainability: The burn mechanisms ensure that the supply of $QUBIC is regulated, contributing to long-term sustainability and potentially enhancing the token’s value over time.

• Real-World Integration: Oracle Machines and AI integration allow $QUBIC to be used in various real-world applications, enhancing its utility and relevance.

Conclusion

QUBIC (Quorum-Based Computation) combines blockchain with AI using a Useful Proof-of-Work (uPoW) system to direct mining computational power toward AI training, enhancing its AI component, Aigarth. The network uses 676 Computors to validate transactions and execute smart contracts via a quorum-based consensus. QUBIC processes up to 40 million transfers per second and uses Oracle Machines to provide real-time data, enabling smart contracts to respond to external events. The QUBIC token ($QUBIC) funds smart contracts, facilitates transactions, and supports network consensus, with a controlled emission and burn mechanism ensuring sustainable utility.