Parts of the Ethos platform operate on the blockchain and other parts don’t. This structure is due to the simple fact that there are certain things blockchains are good at doing (keeping track of assets, verification, high value data persistence) while there are other things (scalability, cost, data storage) that blockchains are not good at doing.
Ethos uses the blockchain in several ways. First, Ethos keeps Nodes* of all major coin transactions, and identifies which are “verified” transactions according to registration data held within the Ethos ecosystem. This data can then be accessible by verified stakeholders or interested parties through the Ethos API in exchange for ETHOS tokens.
Secondly, Ethos can further identify source of funds for certain blockchain transactions if those funds come into the ecosystem through an Ethos-partnered service such as a registered investment advisor, broker dealer, investment company, etc. Identifying KYC and AML’d funds and transactions enables Ethos to contribute to a safer and more secure blockchain.
Thirdly, scalable micropayment channels, or layer 2 scaling solutions, can be utilized on Ethereum involving ETHOS token transfers. This enables extremely cheap financial services for people around the globe who often have no access to financial services while also keeping the integrity of the system with verified source of funds on the blockchain.
Finally, smart contracts enable Ethos to build a new financial ecosystem that benefits consumers first. The Ethos Ecosystem also enables consumers to own, and benefit from, assets directly using the properties of provable ownership on the blockchain. While in the traditional economy, direct ownership of an asset is difficult or impossible in some cases, the blockchain allows advanced financial instruments to be owned and custodied by the individual, vastly democratizing access to a global financial ecosystem.
Broadly speaking, the Ethos platform has four major components:
The Ethos Universal Wallet: a self-custodied blockchain asset management architecture open to consumers, institutions and developers.
Ethos Smart Keys: a single secure digital key solution that allows secure self-custody or custodial management of hundreds of different coins, tokens and currencies with a single key.
Ethos Bedrock: a “Stripe for Crypto” processing and development platform that can run scalable applications, broadcast data and verify identity and source of funds on the blockchain.
Ethos API: a way for financial institutions to seamlessly connect with financial institutions creating a new breed of FinTech applications.
*For more information on what Nodes we have running now, check out our Trello board by clicking here!
For more information on the Ethos Ecosystem and Ethereum, check out the full article that the above information is sourced from by clicking here!