SCTC provides an ecosystem for the auto industry which circulates value and shares data between chains. SCTC plans to combine Parity and Polkadot into a single collective. The technology is currently undergoing development and is planned to be released in the third quarter of 2019.

Polkadot is a scalable composite multi-chain platform (meaning multiple types of chains can connect to the network) that focuses on maintaining the validity of all state transactions so that the main chain (relay chain) can continuously process transactions. The Polkadot network provides a pooling security model (consensus and service) through the relay chain. The relay chain allows other Parachains (chains capable of parallelization) to connect to it and share in the network’s security (consensus).

Any parachain can send and receive transactions through the relay chain. A key component of the Polkadot network is its ability to simultaneously transmit value (tokens) and arbitrary data. For instance, a smart contract in the auto finance chain can send a transaction stating “this car has already been paid for,” allowing the manufacturer to begin production. In addition, Polkadot allows bridges (virtual chains) to be used on currently existing blockchains like BitCoin, Ethereum, and Hyperledger.

The diagram below explains the SCTC core chain’s infrastructure and different participants the SCTC ecosystem provides consensus and maintenance services for.

1. The SCTC core chain assists in connecting to chains in the SCTC ecosystem and the bridge chain (virtual chain) that connects SCTC to the Polkadot network.

Above is a real-world example of the SCTC core chain in action, connecting parachains in the SCTC ecosystem, and the bridging chain (virtual Parachain) that connects the SCTC backbone to the Polkadot network. Below is a description of the components and participants shown in Figure 1. Figure 1: The SCTC core chain, which assists in connecting chains in the SCTC ecosystem, and the bridge chain (virtual chain) that connects the SCTC main chain and the Polkadot network.

1. The SCTC Core Chain

The SCTC core chain is a state and account-based system that features a transaction counter. The SCTC core chain will maintain main accounts in the network. The SCTC core chain won’t contain traditional smart contracts created by network users. Rather, these user-created smart contracts will be stored and used in parachains. The SCTC core chain will have fundamental smart contracts to facilitate functionality, for instance equity interfaces, shareholder bond management and parachain registration. Fees in the SCTC core chain are already set, and therefore won’t change depending on network requirements. If the scale needs to be expanded, the relay chain can join the network, becoming a second-order relay chain.

2. Parachains

Parachain refers to a custom state machine (the brain of the system which can change the chain state to a new state). It features user-defined attributes, customizable feature, and uses the SCTC core chain to reach consensus. Parachains can be added to the SCTC core chain by network users, and are estimated to be capable of 1,000 transactions/second. Adding parachains will incur costs in SCTC tokens. SCTC tokens can be locked in a smart contract or destroyed depending on the situation, which will be determined by the managing system. A few examples of parachain state machines include:

(1) Zero-Knowledge Proof chains (ZKP) like ZK-SNARKS or ZK-STARKS, which achieve anonymity/privacy

(2) An alliance chain where only the auto manufacturer can send transactions or create smart contracts

(3) Licensed A.I., which can simulate inventory management data to detect fraudulent activity and send messages to other chains in the SCTC ecosystem.

3. Bridges (Virtual chains)

Bridges are a two-directional communications systems that are useful in inter-network interactions. Once the SCTC core chain finalizes a block, it can use the transaction to pass the block to the network bridge. Custom bridges to transfer value and arbitrary data from the SCTC system to other networks have been developed for other types of blockchains. In addition, SCTC will use the Polkadot network to transmit messages and values to the Polkadot bridge through the SCTC’s core chain if needed. Private chains can also be linked through bridging, like the IBM Hyperledger chain and Hyperledger smart contract, in addition to accessing authenticated data sources It also provides smart contracts in the SCTC ecosystem.

4. Participants in the SCTC Core Chain

Participants join in the 3rd stage after economic analysis.

5. SCTC Core Chain Consensus

The consensus engine will facilitate submission of the final block to the SCTC core chain. The SCTC core chain’s consensus engine locks the SCTC core chain’s blocks as well as the blocks of all parachains. It also simultaneously confirms that all blocks can provide high-data availability while minimizing latency for the entire system. The SCTC core chain will use a customized DSC format (Dynamic State Consensus) and the Tendermint Engine for its consistency algorithms. These are BFT consistency algorithms currently being developed by Penta and Tendermint. Details concerning the methods DSC and Tendermint currently use to achieve consensus is are given below:

(1) DSC uses the random classification algorithm RSA to select stakeholders in the network to provide consensus for the target parachain and relay chain.

RSA is an algorithm that can randomly select objects from a random sample. For instance, if the target sample lists the numbers 1–1,000, then the RSA can randomly select a number from between 1 and 1,000 every time its used.

(2) A verifier is used to conduct voting during the consensus process, but every verifier only has one vote during the consensus process, while the verified stakeholder determines the weight of the vote. This method increases the fairness of the system, allowing stakeholders with smaller revenues to participate in the voting process, thereby increasing the decentralization of the process.

(3) Using the Tendermint method to submit blocks implements voting and submitting transactions to block (see Figure 2).

(4) According to Figure 2, above, The verifier group is selected through RSA to end the blocks on the parachain and form candidate blocks for the SCTC core chain.

(5) Verifiers run the following procedure to submit the final block of the relay chain. The consensus process is as follows:

If two-thirds of the verifiers vote to advance in the same round and pre-submit a block (requires two rounds), the new block will be submitted to the blockchain. Tendermint assumes that one-third of the verifiers are Byzantine, ensuring Tendermint’s security while not submitting two blocks at the same block height. If the block can’t be submitted, the protocol will proceed to the next round, and different verifiers will recommend blocks for the next block height.

The number of stakeholders participating in the SCTC core chain consensus process will but will still be further developed depending on how many verifiers participate in the network’s consensus. Verifiers and incentives of other stakeholders in the system will represent their personal interests, and will depend on their role in the consensus process. Consistency algorithms will promote finality while avoiding forks. The ability to reset the consensus process (restarting the consensus process if malicious activity is detected or no consensus is reached within a specified time frame) provides a way to avoid incorrect behavior that may occur during the block consensus process. RSA will be used to select a new random sample of verifiers when the reset function is used.

The SCTC custom consistency algorithm will provide a highly decentralized BFT consensus engine for the SCTC core chain, which will supply participating stakeholders in the system with a scaled reward for SCTC equity. In addition, by voting instead of directly connecting to the shares of consensus participants, the ability to use the reset function to recover the block increases fairness if incorrect behavior is detected. With the upcoming release of Polkadot technology, SCTC’s implementation of DSC and Tendermint will be further refined to provide consistency with the Polkadot system and SCTC ecosystem user experience.