Ethereum is one of the most popular decentralized blockchain platforms for building and executing smart contracts and decentralized applications. Many projects utilize third-party blockchain to expand the functionalities of the Ethereum blockchain, and one among them is the Omni network. By working as an add-on layer Omni network broadens the capabilities of the Ethereum network.
Table of content
- What is an Omni network?
- Key features of Omni network.
- Advantages of Omni network.
- How Does Omni Network Enhance the Capabilities of Ethereum Blockchain?
- How does an Omni network work?
- What is OMNI?
- Challenges of Omni network.
What is Omni Network?
Omni network is a layer 1 blockchain used to improve the capabilities of the Ethereum network. By working as an integrated layer, the Omni network supports a large number of decentralized finance (DeFi) applications to enhance the interoperability, scalability, and security of the system, making the interactions within the platform seamless and reliable.
Key features of Omni network
1. Restaking
The restaking technique allows Eherium users to stake ETH tokens in the Omni network. This eliminates the need for buying OMNI tokens just for staking in the Omni platform.
2. Rollup Communication
Omni creates a communication network for rollups allowing the transfer of information easily, thereby eliminating the rollup issue faced by the Etherium network.
3. EVM Service
Omni Network offers an EVM service that is compatible with all decentralized applications and projects within the Ethereum network.
4. Gas Abstraction
Omni network offers a single payment of a fee for every rollup made. On many other applications, users are required to pay separate transaction fees for every single rollup made.
5. Comet Byzantine Fault Tolerant Consensus System
Comet Byzantine Fault Tolerant Consensus System (CometBFT) offers scalability and security for every transaction, ensuring no malicious users are intruding on the platform.
6. Dual Layer Network
Omni network works on two layers: the consensus layer secures and validates the transaction, while the execution layer processes the transactions.
7. Collaborative Consensus
Omni’s consensus system runs on both Omni’s main system and Etherium Virtual Machine (EVM). Half of the consensus is in the Omni system and the other half in EVM, allowing them to achieve security by utilizing the Etherium platform advantage along with maintaining their own proprietary rollups.
Advantages of Omni Network
Working as an integrated layer to enhance the utility of the layer 2 blockchains, the Omni network exhibits many advantageous features.
1. Interoperability
Interoperability is one of the key features of the Omni network. By allowing seamless transactions with other blockchain networks, the Omni network eases the process of sharing information across multiple blockchain platforms.
2. Scalability
Omni network handles a large number of transactions with swift speed and without affecting performance, making it one of the most used networks in DeFi applications. The platform allows the integration of large number of applications within their ecosystem.
3. Security
By utilizing the advanced security protocols, the network eliminates the chances of hacks and scams, providing robust security to the platform. Along with facilitating swift transactions, the Omni network also ensures the validity of Ethereum coins.
4. Decentralization
By eliminating the need for a third party in system management and decision-making, Omni Network allows the involvement of every participant in the well-being of the project. That means all the members get equal opportunity in the governance of the platform. The decentralization also reduces the transaction fees.
5. User Interface
Omni network offers software development kits (SDKs) and application programming interfaces (APIs ) for developers and users and thus enhances the interaction within the platform.
How Does Omni Network Enhance the Capabilities of Ethereum Blockchain?
Rollups are one of the key features of the Etherium layer 2 networks. It allows the stacking of multiple transactions together and publishing them as a single entity in the Ethereum network. Although these rollups provide faster and cheaper transactions, utilization of their own roll-up technology makes it difficult to access the rollup information and transfer the data between different rollups.
To solve this issue, Omni introduced the protocol allowing the messaging between rollups. The enhanced communication among rollups made the Etherium blockchain more effective and efficient.
How Does an Omni Network Work?
Omni network acts as a complete standalone network between Ethereum and layer 2 roll-up systems.
The Omni Ethereum interoperability protocol utilizes a proof of stake consensus mechanism to allow validators to verify the transactions. By locking the crypto assets temporarily, the consensus mechanism deploys a 3 layer architecture for connecting different roll-ups and enables the passing of information among them. The base layer handles transaction validation, block development, and consensus while the middle layer enables cross-chain communication and transfer of assets. The final layer is the application layer, where the developers build and execute decentralized apps.
A transaction starts when a function call is made. The smart contract converts the function call to a language compatible with Omni. The Halo protocol in the Omni network analyzes the data and packs it in a structure called XBlock.
The relayer protocol converts the XBlock into a language that the secondary roll-up can process. It is then transferred to the final roll up and the request gets delivered to the end user.
What is OMNI?
OMNI is the native token of the Omni network allowing developers to make transactions with the Omni platform. Capped at 100,000,000, the token enables direct decision-making authority to the holders. Since the tokens are distributed among various stakeholders, they portray features including transparency and security.
Use cases of OMNI token
- Governance: The token can be utilized for involvement in the decision-making process of the Omni network.
- Staking: OMNI token is used as a stake in the Omni platform.
- Transaction fees: OMNI tokens can be used for paying transaction fees.
- Gas abstractions: Users can pay OMNI tokens as rollup fees.
Token distribution
| Ecosystem development | 29.5% |
| Core contributors | 25.3% |
| Investors | 20.1% |
| Community establishment | 12.7% |
| Public launch | 9.3% |
| Advisors | 3.3% |
Challenges of Omni Network
1. Maintaining scalability
When the network grows, it is difficult to manage the low latency and high throughput rate. To maintain stability continuous optimization and development are required.
2. Security concerns
Though the platform offers robust security, regular updates of security standards are required to overcome new types of hacks and threats.
3. Regulatory issues
The regulatory guidelines of DeFi and blockchain networks are regularly evolving, making Omni networks adapt to the continuing changes which can be time-consuming and cumbersome.
Final Thoughts
Omni network is built to mitigate the issue of rollups in the Etherium network. It eases the communication between different rollups and enhances the performance and effectiveness of the Etherium blockchain. The native token of the Omni network, OMNI has many utilities helping it secure its value.