A DEEP DIVE INTO THE HECO CHAIN

HECO (Huobi Eco Chain) is a decentralized, eco-friendly, EVM-compatible layer-2 blockchain that powers the Huobi ecosystem. In this article, we’ll discuss HECO, and explain how it enables developers to seamlessly build decentralized applications (dApps) at low cost.

TL; DR

• HECO is a decentralized, highly effective, energy-saving public chain for the Huobi ecosystem which was created to facilitate smart contract compatibility and high performance.

• The HECO chain utilizes the hybrid proof-of-stake consensus mechanism to facilitate swift cross-chain transactions. As a layer two scaling solution, the HECO chain bolsters the Ethereum ecosystem, thereby improving its effectiveness.

• The Huobi Token (HT) is the native token of the HECO chain which is used for payment of transaction fees and utilizing the decentralized applications in the Huobi Ecosystem.

WHAT IS HECO?

HECO (Huobi Eco Chain) is a highly efficient, eco-friendly, EMV-compatible layer two blockchain that employs a hybrid proof-of-stake (HPoS) consensus mechanism to facilitate fast cross-chain asset transmission.  

HECO, which was created as an Ethereum scaling solution, offers an effective and reasonably priced on-chain experience with a focus on high throughput, low latency, security, and stability. Thus, developers can build decentralized applications (dApps) on HECO with ease and at a low cost.

In addition to enabling cross-chain asset transmission, the HECO chain is also capable of handling over 2000 transactions in one second with three-second block finality. Hence in terms of block finality, HECO falls in the same category as next-gen solutions such as Aptos which is capable of handling about 160,000 transactions in one second with sub-second finality.

OVERVIEW AND HISTORY OF HECO

The HECO chain was established by the Huobi Group to offer decentralized finance services to developers.

The Huobi Group was established by Leon Li, who currently serves as its CEO. In 2011 Leon became an advocate for Bitcoin after receiving his degree in automation from Tsinghua University. Leon then began his career as a computer engineer with Oracle. In 2013, Leon launched Huobi Group and turned it into a major participant in the world of financial services for digital assets with the goal of integrating blockchain technology with other industries.

Huobi officially launched the testnet of the  Huobi ECO Chain (HECO) in December 2020. As the first product launched on the Huobi Open Platform. Its mainnet went live a few days later.

As at December 2021 about 27 enterprises submitted applications to become HECO Master Builders sponsors. These included exchanges, investment institutions, security assessment firms, and IT infrastructure corporations.

HECO is committed to helping the projects in its network develop. The Grant Program, Joint Accelerator Program, US$1 Million Incentive Program, and HECO Demo Day are just a few of the incentive programs that HECO has unveiled over the past year to provide upcoming programmers and developers with the tools and resources they need to explore cutting-edge blockchain innovation.

On the 14th of October 2022, the founder of Tron, Justin Sun announced that the Tron and BitTorrent Chain ecosystem will merge with HECO. This announcement was made a few days after Sun was revealed to be amongst the initial list of Huobi Global advisors.

Sun’s announcement resulted in a massive surge in the price of the Huobi Token (HT). Tron's native token TRX was also impacted by the announcement as it increased by 4% in just an hour after the announcement was made.

As at the time of writing HECO had a total value locked of about $106.43 million with MDEX, a well-known decentralized exchange – considered to be a contender of UniSwap – accounting for about 68 percent of this value.

HOW DOES HECO WORK?

HECO adopts a hybrid proof-of-stake (HPoS) – a blend of proof-of-work (PoW) and proof-of-stake (PoS) – consensus mechanism which allows holders of its native token to choose among 21 validators who will validate on-chain transactions and create blocks. Every three seconds, HECO generates one block, and after every 200 blocks, an epoch occurs after which the system modifies the list of active validators.

To become a validator, users must first make a proposal and then wait for other validators who are currently online to vote on it. If more than half of them approve, you are then qualified to become a validator. HECO also supports delegation for users who are unable to become validators as any address can stake their tokens to an address that is eligible to become a validator, and once that validator's staking volume ranks in the top 21, it will become an active validator in the next epoch.

Furthermore, community-led governance is made possible via the HECO decentralized autonomous organization (DAO). Hence, without a centralized authority, network users can vote on a variety of protocol modification requests.

ABOUT THE HT TOKEN

HT is the native token of the HECO chain. HT is used for the payment of transaction fees, and for utilizing decentralized applications on the HECO chain. As of the time of writing, HT had a market capitalization of over 1.331 billion US dollars and was trading at $8.67, representing a drop of roughly 75.17% from its all-time high in May 2021 when it traded for $34.96.

Holders of HT tokens are entitled to reduced transaction fees, early entry to exclusive Huobi events, seasonal crypto awards, and the chance to vote on exchange decisions.

HOW TO ADD HECO TO METAMASK

To set up MetaMask for the HECO chain, simply download MetaMask on your device or install the chrome extension from the chrome web store.

After installing MetaMask, set up a new wallet or import an existing wallet. To add the HECO network, navigate to settings and click on networks.

Next click on the "Add Network" button, and click on custom network.

Then enter the following parameters:

• Network Name: Heco-Mainnet
• New RPC URL: https://http-mainnet.hecochain.com
• ChainID: 128
• Symbol: HT
• Block Explorer URL: https://hecoinfo.com

Ensure that you have entered the correct parameters into the respective fields and click on the "Add" button. You will receive a popup notifying you that you have switched to the Heco-Mainnet. Click on "Got it" to continue.

THE HECO ECOSYSTEM

HECO is home to several decentralized applications and Web3 protocols, thanks to its smart contract compatibility, which allows developers to deploy Ethereum smart contracts and dApps on-chain via a familiar process.

The top ten blockchain applications on the HECO chain can be seen on DappRadar here.

Some of the popular blockchain applications on HECO include:

• MDEX:

MDEX is a decentralized transaction protocol based on an automated market-making technique. Through its liquidity services, MDEX seeks to provide users with a safe, and affordable transaction experience.

MDEX also incorporates a dual mining mechanism that supports both transaction mining and liquidity mining. Hence, users can receive tokens for each trade or transaction in addition to receiving incentives for supplying liquidity and trade mining.

• BitKeep Swap:

‍BitKeep Swap is a decentralized multi-chain platform that offers its users all over the world secure and practical one-stop services for managing digital assets, in addition to facilitating instant token swaps for over 220,000 tokens without charging gas fees.  

• Belt Finance:

Belt Finance is a stableswap automated market maker (AMM) protocol with minimal fees and slippage that combines multi-strategy yield optimization on Binance Smart Chain (BSC), HECO Chain, and Klaytn. It also offers aggregation through vault compounding, lending, and yield production for maximum rewards.

By utilizing a mix of trading fee incentives and a multi-strategy optimization vault system, Belt Finance is committed to providing customers with the highest yield.

FINAL THOUGHTS

The HECO chain facilitates the mass adoption of blockchain technology as it facilitates efficient, flexible, and affordable transactions. Cutting-edge layer-one solutions like Aptos are also committed to expediting this process by creating the most secure and scalable layer-one blockchain that will be readily available to everyone.

Aptos is in a good position to achieve this as it currently outperforms most contemporary layer-one blockchains in terms of speed, cost, security, and scalability. In addition to incurring near-zero fees and the ability to handle up to 160,000 transactions in one second with sub-second finality.

Pontem, a leading product studio that facilitates global financial inclusion is the gateway to the Aptos blockchain and is developing the infrastructure and decentralized tools necessary for the adoption of the Aptos blockchain.  The Pontem wallet enables its users to connect to decentralized applications, explore the Aptos ecosystem, and exchange tokens. Moreover, Pontem's Liquidswap which is the first Automated Market Maker (AMM) on Aptos makes it seamless for users to swap tokens in a safe and decentralized manner, in addition to offering liquidity pools and a bridge that facilitates asset transfers across blockchains.

ABOUT PONTEM

Pontem is a product development platform that fosters global financial inclusion through blockchain technology. As a result of its partnership with Aptos, Pontem can create the foundational dApps, EVMs, AMMs, and other infrastructure needed to adopt its layer one blockchain.