Home / Coin Guide / What is Blockcloud? A Review of the Blockchain-based Service-centric Network Stack

What is Blockcloud? A Review of the Blockchain-based Service-centric Network Stack

The Blockcloud provides a solution to the drawbacks of scalability and transparency stifling the IoT (Internet of Things) industry’s growth. On a conventional IoT network, a majority of platforms provide a centralized server that aggregates the entirety of connected devices, data, and services. A structuring of this sort eventually contrives encumbrances to scaling via high-bandwidth consumption as well as a centralized point of failure.

To solve these predicaments, Blockcloud proposes a protocol that is incentive-driven for IoT services, configured for security & scalability. Most significantly, the protocol will serve as the base of a feasible ecosystem of interconnected smart devices.

Blockcloud Technical Overview

Primarily, Blockcloud’s aim entails providing a more solid option for TCP/IP, a fundamental protocol that facilitates p2p communication. In this age, the internet is a sequence of technology layers that work hand in hand to give the resources to the websites & applications we know of today. Prior to diving into Blockcloud’s technical aspects, we will briefly have a glance at these layers:

  • Application Layer:

Websites and applications operate using such protocols as, among others, HTTP, FTP, and SMTP at this layer.

  • Transfer Layer:

Such protocols as TCP/IP and UDP operate here. Fundamentally, this layer separates information into distinct packets of data with instructions on how to patch up the data packets.

  • Internet Layer:

Data packets are then pushed to the internet layer with IP addresses.

  • Network Address:

The network address takes care of the MAC address and sends information to the relevant physical machine.

Blockcloud’s TCP/IP architecture is designed in such a manner that it brings modern IoT services to a whole new level. The project’s team has established a number of the flaws present in the current architecture, being inclusive of, just to mention but a few, inadequate security, limited mobility, lack of transparency or rather trust, as well as scalability issues. Blockcloud endeavors to address the issues regarding limited mobility and scalability through the implementation of Service-centric Networking. Respectively, the protocol addresses transparency and inadequate/poor security issues through its implementation of blockchain technology.

  • Service-centric Networking

Service-centric Networking (SCN) is a futuristic model of the Internet of Things and Internet infrastructure. Its basic distinction lies in the fact with this model apps in the network instead of communicating based on IP addresses, they communicate on the basis of names. It gives room for higher flexibility of the architecture which is more befitting for the Internet of Things, in which case nodes are dynamic. In addition, the architecture takes into consideration the location of the user as well as performance essentials, in the event of optimizing the user’s service components’ location.

The architecture provides marked up mobility via the Service Access Layer (SAL) or Serval. The developer team intends to use a Serval networking stack, which according to them is most befitting SCN for the project. A Serval stack allows for communication between applications (as well as dApps) on the basis of names instead of IP addresses. This, as a result, scales up mobility, owing to the fact that it heightens the adeptness of load balancing and failover speed.

What’s more, the architecture marks up scalability via DHTs (Distributed Hash Tables). Significantly, the team intends to implement Coral DHT, which not only minimizes the cost of caching data but is as well apt for mobile and dynamic networks, similar to those in the Internet of Things.

Security issues will be addressed through the implementation of blockchain technology, which is renowned for its security. The PoS (Proof-of-Service) consensus algorithm and the network’s decentralized nature minimize the network’s vulnerability to fraudulent activities or attacks.

  • Proof-of-Service (PoS) Consensus

PoS is a consensus algorithm developed by the Blockcloud team for IoT blockchain solutions. In blockchain protocols such as this, users are in a position to share one or a combination of such resources as relay, data, computation, bandwidth, and storage. In so far as the Proof-of-Service is concerned, user contribution is regularly verified by miners as they verify the quality of the proclaimed service utilizing puzzle-structured mathematical problems, as is the case with the PoW (Proof-of-Work) consensus algorithm. In the event the quality of the service does not warrant its proclaimed level of quality, the latter will be punished. Chain validators are recompensed for their validation work using the BLOC tokens. Significantly, the PoS consensus was contrived to effectively keep track of the performance of these validators.

  • The Transaction Layer

The transaction layer is the cardinal layer of the Blockcloud architecture. It is at this layer that the entirety of Blockcloud transactions are organized into blocks and appended to the Blockcloud blockchain. Contrary to conventional blockchains, the Blockcloud blockchain gives room for multiple blocks to be simultaneously appended to the chain. This is attained via the incorporation of the CoDAG (Compacted Directed Acyclic Graph) structure. CoDAG, other than being flexible, is as well able to concurrently append more than one block to chain, making it consummate for IoT’s asynchronous nature.

Operations are defined at the servicechain layer. Servicechains can be utilized in the development of state machines. Thus far, Blockcloud has 2 state machines namely: a global service management machine and a service matching and pricing machine which supports the Blockcloud marketplace.

The above-mentioned machines are intended to support Blockcloud’s smart contracts. If needed, new state machines can be augmented to the servicechain layer.

  • The Routing Layer

The routing layer separates routing requests and provides services. To this effect, Blockcloud is independent of any specific service management, giving room for the co-existence of multiple service providers.

  • The Service Layer

It is at the service layer that services are provided. Given that the provision of services is carried out on a different layer, there is the possibility for multiple service providers to co-exist utilizing a variety of Internet-of-Things services. What’s more, owing to the fact that Blockcloud’s communication between apps is on the basis of names and not addresses (IP addresses to be more particular), a single name can make reference to a cluster of devices offering a similar service. This, as a result, increases efficiency.

Most Noteworthy, the proffered enhancements to the extant TCP/IP architecture are seemingly able to resolve the present issues. Be that as it may, it is worth noting that the project’s whitepaper is only hypothetical and doesn’t contain any description regarding what they have thus far accomplished. As such, it is no guarantee that the delineated hypotheses are able to be successfully put into effect in the real world.

Blockcloud Market Overview & Competition

Ericsson, in their 2017 annual report, projected that by the year 2022 the no. of interconnected Internet of Things devices will have reached 22 billion. In their June 2018 mobility report, this figure was raised to 31.4 billion as of 2023. Statista, which is more optimistic, projects that by 2023 this figure will have attained the 51.11 billion mark.

Whereas as per Ericsson’s estimation the compound annual growth is 10.2%, Statista estimates this figure to be 14.6%. Regardless of the level of market growth which appears to depict appreciable prospects, IoT is bound to face significant issues. The contemporary architecture does not befit such a huge no. of devices. Furthermore, the present Internet-of-Things architecture is flawed by a lack of security as well as a deficiency of financial incentives for providers to partake in the network since there is no transparency in as far as financial returns go.

Blockcloud strives to enhance the current TCP/IP architecture and communication between underlying Internet-of-Things devices by amalgamating blockchain and SCN stacks. Supposedly, this amalgamation will bring security, transparency, heightened mobility, and scalability to the current architecture.

Most noteworthy, Blockchain is joining a market that is tremendously competitive. IOTA was one of the inaugural organizations to implement an IoT-suitable architecture. The project is considered as being among the most established Initial Coin Offerings (ICO) ever with a Return on Investment (ROI) projected at 100,000%. IoT chain is yet another rival with its target on the Chinese market. Significantly, the organization has set up solid connections with manufacturers of IoT devices.

Another significant competitor of Blockcloud is Byteball. Be that as it may, it is worth noting that Byteball does not target the IoT industry, given that it is among the largest DAG projects making its infrastructure befitting for use in an abundance of IoT projects.

The entireties of projects, with the exception of Blockcloud, use DAG as a part of their consensus mechanism as regards appending transactions to the block. Blockcloud implements a rather enhanced model of DAG referred to as CoDAG.

IOTA uses consensus mechanisms on the basis of the transaction confidence metric. Whereas Blockcloud, on the other hand, implements the Proof-of-Service consensus algorithm, IoT Chain implements the PBFT (Practical Byzantine Fault Tolerance) consensus algorithm. Byteball’s consensus mechanism is on the basis of the Directed Acyclic Graph (DAG).

As mentioned earlier, Blockcloud’s PoS is seemingly more befitting for networks that are IoT oriented, given that it captures IoT’s service-centric nature. Nevertheless, this mechanism is yet to be tested. As such, it is not clear whether or not it will perform well. The Practical Byzantine Fault Tolerance mechanism was flawlessly implemented by Ripple and is considered to require lesser effort as compared to the Proof-of-Work consensus mechanism. Byteball neither implements the PoS nor the PoW consensus mechanisms.

Product & Traction

Whereas as per Ericsson’s 2017 mobility report IoT is estimated to connect over 22 billion devices by 2022, Statista is more optimistic that this figure will beat 52.11 billion by 2022 and 75 billion by 2025. The current IoT architectures, which are based on internet design, other than internet strength, have as well adopted its flaws including security and scalability issues.

Blockcloud’s endeavor is to contrive a more futuristic TCP/IP architecture. By amalgamating blockchain and SCN technologies with state of the art IoT architecture, the team behind the project purposes to come up with a blockchain infrastructure with the suitability to process dynamic and asynchronous data flows, as is the case with IoT.

The team indicates that current Internet-of-Things solutions, both centralized and decentralized, are susceptible to trust, mobility, security, and scalability issues. Furthermore, the current network has no known way of incentivizing service providers to come aboard the network. Consequently, Blockcloud intends to resolve the latterly mentioned issue via token awards. A PoC (Proof-of-Contribution) consensus mechanism developed by the team, one they are confident is more befitting for IoT blockchain, will be at the helm of token distribution.

As of Aug 2018, the project’s team had only published the Technical Whitepaper with nearly zero information regarding the coin’s ICO. In addition, the organization’s official website has no information as regards the amount of tokens present in the private sale, which is 1.5 billion BLOC (Blockcloud token ticker). The coin’s aggregate hard cap is $12 million USD which they are hopeful will be raised in the private sale. What’s more, the project assesses its value at $80 million USD at TGE. The token sale took place in the third quarter of 2018. A BLOC token will be priced at $0.008 USD per unit at TGE. A lock-up mechanism was implemented amid the private and 20 percent of the tokens were released prior to the exchange listing. 2 months into the listing, 10 percent of the tokens will be released over the following 8 months. Given that the project is as yet in its initial stages, regardless of the fact that the team announced that they’re ardently working on the project, there is not only a smart contract for review but a GitHub profile as well.

The crypto coin has a market capitalization of $80 million USD and is scheduled for allocation in tokens. The larger part of the tokens will be allotted to mining rewards and the foundation. These tokens will be released on an annual basis at a 5% rate over six years. The foundation’s purpose is as yet unclear, as well as what is implied by “Other Sale”. There is as well no information regarding the manner in which the funds are to be allotted a regards development. Most significantly, there are significant chances that the project will not manage to fulfill its promises. Also, there is no information with regard to any lock-up periods for the team’s tokens.

Blockcloud Economics

Blockcloud’s new architecture brings a new prototype to the blockchain sphere as it strikes innovation where former projects haven’t even began to explore. The remodeling of the network stack’s foundation via Service-centric Networking contrives higher levels of scalability, and with the combination of blockchain, it brings about a robust and dynamic new type of network.

Via the Service-centric Blockchain, Blockcloud is in a position to run over anything, being inclusive of IP. As such, the benefits of the Blockcloud project in so far as service distribution, state-of-the-art security, broadcast, mobility, as well as application-friendly communication and naming can be realized in an incremental and rather painless manner.

To accustom the asynchronous transaction of data and value between service providers and subscribers on the network, Blockcloud will incorporate a novel DAG structure, or Compacted Directed Acyclic Graph (CoDAG). The flexibility afforded by a DAG is better suited to recording transactions between ecosystem participants in a dynamic manner as devices move on and offline.

All things withstanding, here is what the team had to say:

The token economy was designed by our own financial advisory team after a comprehensive consideration of all the factors. Our system integrates promising aspects of existing token systems with our own unique approach in order to bring promising returns to investors, holders, and users. Blockcloud has created a new type of IoT service market. Through the efficient pricing and distribution of IoT services, we can both encourage capable devices to contribute services and provide strong economic incentives for the IoT community.

BLOC Token Analysis

Blockcloud provided 1.5 billion BLOC tokens for sale in the private sale in the third quarter of 2018. The coin’s hard cap is set at $ 12 million USD. As of the time of this writing, the token (BLOC) is priced at $0.00906 USD. Only 15 percent of the tokens’ entirety was allocated to the private sale. The projects team will retain 10 percent of these tokens and 60 percent will be set aside for the miners of the coin and the foundation. As much as there is no information regarding the team’s token lock-up, private sale tokens are to be released at the rate of 10% per month in a span of 8 months and 20 percent of the tokens will be released ahead of the exchange listing. This scheme is rather shaky as the project’s team may opt out of the project and simply walk away from it.

Also, the project’s token economics is not well illustrated. Needless to say, the BLOC tokens will be used to recompense the coin’s miners, supporting the chain through the implementation of the PoS (Proof-of-Service) consensus mechanism. In addition, these tokens will be a requirement to access the Blockcloud infrastructure. Users will as such be necessitated to fund their accounts with these tokens to access the network. Most noteworthy, users will be penalized for bad behavior on the network. For instance, a section of their collateral, equivalent to the price of the service the committed to offer, will be extracted and awarded to miners of the coin, who pointed out the bad behavior.

The Team

Blockcloud’s team comprises largely of scholars, with experiences from Huawei, Tencent, Alibaba, and Baidu, just to mention but a few.

Zhongxing Ming is the organization’s Founder and Chief Executive Officer. A  Visiting Scholar to Princeton University, Ming attained his Ph.D. at Tsinghua University. He is as well a member of Blockchain Special Committee of China Computer Federation, a Shenzhen High-Level Overseas Expert, and he boasts 40 Million accumulative project financing, 13 publications on top conferences and journals.

  • Shu Yang, Chairman:

Shu Yang is a Visiting Scholar to Case Western University. He attained his Ph.D. at Tsinghua University and is currently CEO at Shenzhen Oudmon Technology (what appears to be a small consumer health device manufacturer).

Dai Pan, who is the organization’s Chief Operations Officer, has a Master’s Degree from Peking University. He additionally works at Shenzhen Oudmon Technology.

Dong Huo attained his Ph.D. at the University of Tokyo. He works at the United Nations Development Program (UNDP) Sustainability Goal (SDG) as a Network Expert.

Qi Li is an Associate Professor of Computer Science at Tsinghua University. He is as well a Network Security Expert, an editor of IEEE/TDSC and boasts more than 60 publications on top conferences and journals.

  • Zhengzhou Wu, Cloud Platform Director:

Zhengzhou Wu, the organization’s Cloud Platform Director, is proficient in Lisp and also works at Shenzhen Oudmon Technology.


Blockcloud’s team has a very solid academic background. Rather than raising over $20M like other projects, Blockcloud has opted to raise, in crypto terms, a reasonable $15M. As far as valuations go relative to other crypto projects, Blockcloud could be a nice diversification opportunity for investment portfolios. The overall architecture of Blockcloud combines a blockchain, a Service-centric Network through Serval, a decentralized CDN via Coral, a dynamical width altering DAG for throughput and reputation management, and a marketplace where buyers and sellers of services transact. There are many moving parts to this project, so inherently a ton of risk to the network architecture. However, the inspiration to meet the needs of the future internet is here with this project. IoT devices today are low power, lower data consuming, and mobile devices but what is to say that will be the case going forward. These devices will not only multiply in quantity but are as well likely to improve in performance.

Today’s applications send information to devices using TCP/IP where applications on hosts send data back and forth using IP addresses and DNS name servers. For service and resource providers, Blockcloud may serve as a workaround to the legacy standards of TCP/IP and the clunkiness of today’s evolving standards and solutions (MQTT, Predix, etc.). Public blockchains of the future may also wish to follow their decentralized ethos and bypass the current internet layers altogether. Decades of international regulatory cooperations and billions of dollars in capital expenditures by Internet Service Providers and other infrastructure players to expand our current network services appear to be a ripe area for potential disruption. Or at the very least, a complimentary internet architecture. As always, this is not financial advice but Blockcloud might just be a small investment for such a gamble.

Blockcloud Rating

Tech - 9.2
Economics - 8.1
Team - 8.8
Market Opportunities - 8.2
Product - 7.7


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