Facebook Acquires a Blockchain Startup

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Cheddar reports on 4th Feb., Social media giant Facebook has acquired blockchain startup Chainspace.

Sources reportedly told Cheddar that Facebook acquired Chainspace, a blockchain startup, an acquisition of a company made primarily for the expertise or skills of its staff, instead of the service or products the company provides.

According to Cheddar, four of the five researchers that worked on chainspace’s academic whitepaper will join Facebook. A representative of Facebook told Cheddar that, while the social media giant had hired on the new researchers, it had not procured any of Chainspace’s technology.

As per Chainspace website, the startup was founded by researchers from University College London, was purportedly working on blockchain scalability issues, distinctly by applying sharding to smart contracts.

While several blockchain advocates laud the technology for its security and trustless abilities in processing transaction, presently it is not scalable to the level traditional payments systems like PayPal or VISA. The current no. of transaction per second (tps) on bitcoin network varies between 2 and 18, PayPal can process 115 tps, while VISA is capable of 2,000 tps.

Sharding works on the parallel processing power of multiple network machines that split up the workload of verifying transactions. It automatically separates networks into smaller sections or “shards,” all of which runs a smaller-scale consensus protocol.

While processing in parallel, such a network is capable of handling hundreds of transactions per second per shard, which would significantly increase the scalability of blockchain-based processes.

In Dec. 2018, Facebook listed five new blockchain-related jobs on its careers page: two software engineer roles, a data engineer post, and a data scientist, all at the company’s headquarters in Menlo Park, California.