Coin Report #69: Zilliqa

Coin Report #69: Zilliqa

N.B: In the spirit of full transparency, the following Coin Report update on Zilliqa is a Sponsored Post.

Welcome to the 69th Coin Report. In today’s report, I will be assessing the fundamental and technical strengths and weaknesses of Zilliqa. This will be comprised of an analysis of a number of significant metrics, an evaluation of the project’s community and development and an overview of its price-history. The report will conclude with a grading out of 10. I hope you enjoy the read!

Introduction

For those that missed the first report on Zilliqa, you can find it here. I published that first report over half a year ago, and subsequently liaised with the team to have an updated report published this month. Given that the previous report was published in February, there has been a great deal of development since. As one would expect, there are also aspects that remain unchanged (but are critical to understanding the project); thus, to render this report viable as a stand-alone, there will be some overlap from the previous report. That said, there is plenty to be revisited (including much new ground to cover) and I am intrigued to see how the project has fared over the past eight months. In particular, Metric Analysis, the Community sections and Technical Analysis have been updated in their entirety. Moreover, for this report, I will focus on a plethora of recent blog posts that detail developmental progress in the Development section, allowing for greater focus on new releases and growth. Conversely, some of the sections within Development have remained on-the-whole identical, due to the unchanged nature of certain documents and resources. I have copied these in to allow for the report to be a one-stop resource – thus, it will run on a little longer than normal.

I hope this report will prove objective where it must be and fair on more subjective matters. For those who’d like to learn a little more about Zilliqa prior to reading this report, here are some primary links:


Fundamental Analysis

General:

Name: Zilliqa

Ticker: ZIL

Algorithm: Ethash (Proof-of-Work + Practical Byzantine-Fault Tolerant for validation and consensus)

Sector: Smart Contracts

Exchanges: Binance, Huobi Global, HitBTC, Digifinex, OKEx, MXC, Bithumb, Bitrue, BKEX, Upbit, Hotbit, BitMax, Kucoin, Bitfinex, Bittrex and more.

Launch Overview

Zilliqa was conceptualised in 2017 and had its original whitepaper published late that year, culminating in a crowd-sale for its token generation event in December 2017. This occurred in conjunction with a private sale and altogether the project raised its entire hard-cap of $22mn, in exchange for 6.3bn ZIL of a maximum supply of 21bn ZIL. The ZIL token was created on the ERC-20 standard for the purposes of the crowd-sale. In January 2019, Zilliqa launched its mainnet with a native ZIL token; on 15th February, 2020, Zilliqa launched its token swap to the native token. The mainnet operates using Proof-of-Work on the Ethash hashing algorithm and has a 10-year mining period, during which 8.4bn ZIL will come into circulation.

Regarding allocation of ZIL, 10% of the 21bn ZIL maximum supply was allocated to Anquan Capital in the private sale, 12% to Zilliqa Research, 30% to the public sale, 5% to the team; 3% to other supporting agencies and 40% reserved for the Proof-of-Work rewards.

Price-History Overview

As Zilliqa has been in existence for around three years, there is a great deal of price-history available to analyse. That said, given that its initial listing on exchanges occurred at the beginning of the 2018 bear market, it has only experienced a single distinguishable bull cycle during its existence.

Whilst I will dive into the price-history of the token a little later, for now it will suffice to say that it formed its all-time high against Bitcoin at 2,500 satoshis in April 2018 and its all-time low at ~50 satoshis at the turn of the New Year, in January 2020. Against the Dollar, its all-time high came in around the same time at $0.23 and its all-time low is $0.00026.

Project Overview

Zilliqa is a project that operates within one of the most competitive sectors of the industry: smart contracts. Since the inception of Ethereum, there have been dozens, if not hundreds, of projects that have attempted to improve upon the functionalities of a smart contracts platform by increasing throughput without sacrificing the decentralisation of the network or its security. Most have either failed or remain uncertain in their capacities. Zilliqa is attempting to solve the core issues found with smart contracts platforms by utilising sharding to increase throughput without the requisite loss of a decentralised network.

As stated in its Position Paper:

Zilliqa is a new blockchain platform that is designed to securely scale in an open,
permissionless distributed network. The core feature that makes Zilliqa scalable is sharding
— the division of the network into several smaller component networks capable of
processing transactions in parallel. As a result, the transaction rate in Zilliqa increases as the
mining network expands. Zilliqa aims to rival traditional centralized payment methods such
as VISA and MasterCard. In fact, with a network size of 10,000 nodes, Zilliqa will enable a
throughput which matches the average transaction rate of VISA and MasterCard with the
advantage of much lower fees for the merchants.

Zilliqa will support a smart contract platform with a formally verifiable language that is
sharding-friendly, i.e., it will allow users to compute programs in parallel, harnessing the full
computational capacity of the mining network. For instance, the Zilliqa platform will allow
users to build distributed advertising networks, decentralized exchanges, conduct parallel
auctions, deploy MapReduce-style trading algorithms, run a shared economy, etc.

The ambition of the project is of the highest order, particularly concerning its aims to compete with VISA and Mastercard for payments. I look forward to assessing its progress in this regard.

Let’s begin with some Metric Analysis:


Metric Analysis:

Below are listed a number of important metrics, all of which are accurate as of 29th November 2020. For anyone reading this who has yet to read a Coin Report, it might be worth reading this section of the first report, where any potentially unfamiliar terms are explained. For any terms or metrics specific to this post, I will provide explanations besides the figures.

Metrics:

General:

Price: $0.029 (161 satoshis)

Circulating Supply: 11,426,201,205 ZIL (source)

Total Supply: 13,965,599,212 ZIL

Maximum Supply: 21,000,000,000 ZIL

% of Max. Supply Minted: 66.5%

Network Value: $331,149,707 (18,396 BTC)

Network Value at Max. Supply: $608,613,810

Exchange Volume: $55,731,818 ($40,194,455 excluding wash)

Exchange Volume-to-Network Value: 16.83% (12.14% excluding wash)

Category: Midcap

Average Price (30-Day): $0.0197

Average Exchange Volume (30-Day): $22,034,580 ($15,890,360 excluding wash)

Average Network Value (30-Day): $208,990,396

Average Exchange Volume (30-Day)-to-Network Value: 7.6%

Volatility* (30-Day): -0.0303

Average Daily On-Chain Transactions (30-Day): 37,739

Average Daily Transactional Value** (30-Day): $15,323,892 (source)

NVT*** (30-Day): 21.61

% Price Change USD (30-Day): +29%

% Price Change USD (1-Year): +369.4%

USD All-Time High: $0.23

% From USD All-Time High: -89.1%

Premine % of Max. Supply: 0

Premine Location: N/A

Liquidity (calculated as the sum of BTC in the buy-side with 10% of current price across all exchanges): 186.67 BTC

Liquidity-to-Network Value %: 1.01%

Supply Available on Exchanges: 401,471,513 ZIL

% of Circulating Supply Available on Exchanges: 3.51%

*Volatility is calculated by taking the average price over the given time-period, calculating the difference between it and the highest price and it and the lowest price over that same time-period, and multiplying those figures together. The closer to 0, the less volatility during that period, and vice-versa. Read this for more on volatility.

**Transactional Value in $ is calculated by taking the daily transactional value in ZIL and multiplying it by price.

***NVT is calculated by dividing the Network Value by the Average Daily Transactional Value. See here for more on NVT.

 

Supply Emission & Inflation:

Block Reward Schedule: 10-year emission schedule, equating to 8.4bn ZIL (40% of maximum supply), all of which has been pre-mined and is currently being distributed as rewards.

Average Block Time: 45 seconds

Current Block Height: 904,016

Annual Supply Emission: ~840,000,000 ZIL (1352.4 BTC at current prices)

Annual Inflation Rate7.35%

Circulating Supply in 365 Days: 12,266,201,205 ZIL

 

Public Sale:

The following details were taken from here and here.

ICO Period: 27th December 2017 –  4th January 2018

Total Coins: 21,000,000,000 ZIL

Coins Available For Sale: 6,300,000,000 ZIL

Coins Sold: 6,300,000,000 ZIL

Total Raised: ~$22,000,000

Average ICO Price Per Coin: $0.0035

Token Allocation:

  • Proof-of-Work Rewards: 40%
  • Public Sale: 30%
  • Zilliqa Research: 12%
  • Anquan Capital: 10%
  • Founders: 5%
  • Other Agencies: 3%

 

Distribution:

Address Count: 1,001,663

Circulating Supply Held By Top 10 Addresses: 25%*

Circulating Supply Held By Top 20 Addresses: 28.01%*

Circulating Supply Held By Top 100 Addresses: 32.41%*

Inactive Address Count in Top 20 (30 Days of No Activity): 5*

*Excluding team and exchange addresses, but including subsequent individual addresses.

 

Analysis:

There’s much here for me to unpack, and, unlike for the previous report, I was able to find some solid data for on-chain transactional volume (source). From the block explorer, I found that the Average Daily On-Chain Transactions figure was 37,739 for the past 30 days (almost three times that found in the previous report). Given that there are 1,920 blocks created on average per day, this would mean that there are roughly 19.6 transactions processed per block. More importantly, I found that Average Daily Transactional Volume for that period was $15,323,892 (on-chain), which gives Zilliqa a 30-day NVT of 21.61. This is roughly a third of that of Bitcoin, at present, indicating undervaluation of the network.

Following this, before we move on to more substantial metrics, I’d like to briefly highlight Zilliqa’s 30-day Volatility of -0.0303 (up by roughly a third from the previous report). This is the 13th-lowest (bottom fifth) degree of volatility found among prior reports and is again suggestive of a potential accumulate range, at least against the Dollar.

Now, let’s take a look at the remaining General metrics before moving on to Supply Emission and concluding with Distribution:

Some of the most significant metrics to evaluate for speculators are those related to buy-side and sell-side Liquidity. I found Zilliqa to have buy-side Liquidity of 186.7 BTC (+50 BTC on previous figure) within 10% of spot price across all listed exchanges, equating to a strong 1.01% of its Network Value (down from 1.86% in the previous report). This is the highest nominal degree of buy-side liquidity recorded in these reports, and despite the decline in relative liquidity (a symptom of the increase in market cap since the previous report) it is still among the highest figures for that metric also. Promising stuff for speculators.

Concerning sell-side Liquidity, Zilliqa was found to have 401,471,513 ZIL (+115mn ZIL since the previous report) available for purchase in the orderbooks across all listed exchanges, equating to 3.51% of its Circulating Supplyplacing it in the top third for sell-side liquidity, although not particularly high among those. This suggests to me that, whilst there is clearly some desire for holders to sell their ZIL, there is a clear imbalance here and, from a speculator’s perspective, the demand seems to significantly outweigh the supply.

Zilliqa traded $40.194mn of Exchange Volume (up from $11mn in the previous report) in the past 24 hours, accounting for wash-trading, equating to 12.14% (down from 16%) of its Network Value; an impressive figure. More importantly, its Average Daily Volume for the past month was $15,890,360, accounting for washed volume, which equates to 7.6% (up from 1.77%). Clearly, there is significant and sustained interest in the token.

Moving onto Supply Emission, I calculated that ~840,000,000 ZIL will be minted over the next year (1352.4 BTC-worth at current prices). This gives Zilliqa a modest annual inflation rate of 7.35%.

However, more significant is the relationship between this Supply Emission and the Volume metrics mentioned above:

Given that 840m ZIL will be minted annually, we can work out that the average daily supply emission is 2.3mn ZIL, or 3.7 BTC-worth at current prices. This equates to $66,694 of daily supply emission. As Zilliqa traded ~$40mn of real volume over the past 24 hours, and an average of $15.89mn of real volume daily for the past month, we find that Zilliqa’s average daily supply emission is covered 602.6x by its 24-hour volume and 238x by its Average Exchange Volume (up almost five-fold from the first report)Further, Liquidity of 186.67 BTC covers the average daily supply emission by 50.5x. Clearly, there are no real headwinds for price growth with regards to emission.

In short, any decreases in price are undoubtedly driven either by distribution from larger holders or distribution from smaller holders, and not from the daily emissions being dumped on the market.

Finally, let’s take a look at Distribution:

I was very impressed to find that there are 1,001,663 active addresses on the Zilliqa mainnet (up from 273k). This is by far the highest address count of all coins previously reported on.

With regards to concentration of supply, the top 10 addresses control 25% of circulating supply; the top 20 control 28.01%; and the top 100 control 32.41%. As a percentage of maxim supply, the top 10 control 13.6%, the top 20 control 15.2% and the top 100 control 17.6%. This is excluding team and exchange addresses in the rich-list but including subsequent private addresses. Regarding team and exchange addresses, in the top 20 these control 16.17bn ZIL, amounting to 77% of the maximum supply. If we include these addresses, the top 10 control 86% of the maximum supply, the top 20 control 90.6% and the top 100 control 95.5%.

Within the top 20 addresses (excluding the team-owned addresses and exchange addresses), 5 were inactive over the past 30 days, indicating that a quarter of the largest holders are content with their position sizes. Most significantly, 8 of the remaining addresses have been increasing position size over the past 30 days, with 7 addresses net distributing during that period.

And that concludes this section on Metric Analysis. Onto the Zilliqa Community:


Community:

There are two primary aspects of community analysis: social media presence and Bitcointalk threads. I’ll begin with the former before moving on to the latter.

Social Media:

Concerning social media presence, there are four main platforms to examine: Twitter, Facebook, Telegram and Discord.

Zilliqa is present on all four platforms. To begin, let’s look at the various social metrics that I calculated from the Zilliqa Twitter and Facebook accounts:

Twitter Followers: 98,058 (+30k since previous report)

Tweets: 3,025 (+1,600 since previous report)

Average Twitter Engagement: 0.15% (down from 0.29% in previous report)

Facebook Likes: 1,133 (newly created since previous report)

Facebook Posts (30-Day): 0

Average Facebook Engagement: N/A

As usual, I will be using RivalIQ‘s social benchmark report for evaluation purposes.

Twitter:

Whilst the Zilliqa Twitter account does have the third-largest audience of any coin previously reported on, its engagement rate is not quite as strong at 0.15%; in fact, this engagement rate has almost halved since the first report, with the audience size growing by around a third. That said, in RivalIQ’s report, we find that the average Twitter engagement rate across all industries is 0.045%, which means that Zilliqa’s engagement rate is currently 3.3x greater. It is also 5.5x greater than the Tech & Software sector average of 0.027%. Relative to other coins, Zilliqa’s engagement is 5th-lowest among prior reports. As we can see, the engagement of the official Zilliqa Twitter account doesn’t seem to be getting the traction that one might expect, particularly given how much the audience seems to have grown; that being said, one promising side note is that Zilliqa often features as one of the top performing projects on LunarCRUSH’s social sentiment gauges, suggesting that – whilst interaction with the official account may be low – engagement with the $ZIL cash-tag seems to be much higher.

Facebook:

Now, with regards to Facebook, Zilliqa did not actually have a Facebook page when I published the first report, so it is great to see that they have taken the initiative to create one. That said, over the past month there have been zero posts on the page, despite there being a few posts in the previous month. This is a shame, as clearly there is some effort being taken to build the Zilliqa community on this platform but it does not appear to be consistent.

Discord:

There are over 600 members in the Zilliqa Discord group but it is used primarily for technical discussion by those who build on the platform and the core team. As such, I will focus my attention on the Telegram group (detailed below), where the Zilliqa community resides.

Telegram:

There are 17,532 members of the Zilliqa Telegram group. This is a decrease of 1,680 members since February 2020. There are also 10,008 members of the official announcements channel.

Below are my takeaways from the recent activity in the group:

  • This is the primary community hub, and there is an incredibly high degree of activity, with constant daily discussion.
  • The admins are active in the chat and respond to community support queries and other questions promptly, with the community also providing support where possible. There is no official team support in the chat, however.
  • Some users are reporting issues with staking and connecting problems with ZILSwap at present.
  • ZIL can now be staked from Ledger hardware wallets.
  • 3.7bn ZIL is currently being staked, equating to over $100,000,000.
  • Those that missed the deadline for the ERC-20 to native ZIL token swap will have further instructions for recovery later this quarter.
  • gZIL was recently launched as a governance token for Zilliqa, with ZIL stakers earning gZIL alongside their ZIL rewards at a rate of 0.001 gZIL per ZIL rewarded.
  • Currently, there are three traditional consensus mechanisms being utilised for different purposes: Proof-of-Work to establish mining identities and resist against Sybil attacks; practical Byzantine Fault Tolerance for consensus; and Proof-of-Stake for economic incentives within the ecosystem.
  • Delegators on the network are simply stakers, whilst Operators are those that run SSNs (Staked Seed Nodes). These Operators currently include Moonlet, Zillacracy, Viewblock, Shardpool, CEX.io, EZIL and Zilliqa Research.

BitcoinTalk:

The Zilliqa BitcoinTalk thread was created on September 30th, 2017, though it is an unofficial thread.  It has since generated 1215  posts spanning 61 pages in 1157 days. This equates to 1.05 posts per day, on average. However, in the past 90 days, the thread has had 16 posts, giving an average of 0.17 posts per day; a significant decline in engagement.

As the thread is unofficial, there is no announcement but merely a link through to the website and a summary of the project.

Regarding the content of the thread across the past 90 days, I found the following:

  • HedgeTrade partnered with Zilliqa to offer ZIL on their Social Trading platform.
  • The public testing period for Zilliqa’s staking portal – Zillion – began.
  • ZILSwap was launched in October 2020 – a decentralised exchange, much like Uniswap.

Lastly, I’d like to also mention that Zilliqa maintain a highly-informative YouTube channel, which has 3,110 subscribers and has a cumulative ~140,000 views of its videos, with videos published weekly in general.

And that concludes this section on the Zilliqa Community.


Development:

For the following Development analysis, I will be evaluating project leadership, the website, the roadmap, the whitepaper, the wallets and finally providing a general overview:

Project Leadership:

Zilliqa was founded by Max Kantelia, Amrit Kumar, Jia Yaoqi and Prateek Saxena as a subsidiary of Anquan Capital in Singapore, and there are currently 50 employees listed on LinkedIn, with 26 of these listed on the website. Zilliqa are not currently hiring according to their website.

More specifically, the core team is comprised of:

  • Han Wen Chua, SVP, Ecosystem Development
  • Michael Conn, Head of Corporate Development
  • Arnav Vohra, Developer Evangelist
  • Madison Tang, Growth Analyst
  • Mervin Ho, Growth Analyst
  • Colin JG Miles, Chief Commercial Officer
  • Aparna Narayanan, Communications Manager
  • Milan Shoukri, Marketing Manager
  • Madhav Khandelwal, Brand and Product Designer
  • Ashley Wang, Marketing and Operations Executive
  • Antonio Nicolas Nunez, Senior VP, Release Management and Platform Engineering
  • Jun Hao Tan, Senior VP, Security & Platform Engineering
  • Haichuan Liu, Core Developer
  • Sandip Bhoir, Core Developer
  • Kaustubh Shamshery, Core Developer
  • Joel Lim, DevOps Engineer
  • Renjie Cai, DevOps Engineers
  • Chetan Phirke, Core Developer
  • Ilya Sergey, Lead Language Designer
  • Jacob Johannsen, Compiler Engineer
  • Vaivaswatha Nagaraj, Compiler Developer
  • Anton Trunov, Research Engineer
  • Lulu Ren, Platform Engineer
  • Te Ye Yeo, Full Stack Developer
  • Ovidiu Miclea, Full Stack Developer
  • Rinat Hasanshin, Full Stack Developer

The advisory board is comprised of:

Website:

The Zilliqa website remains effectively identical to that of February 2020 (with some minor updates relating to recent releases such as staking, which I will cover in a separate section). As such, I have copied in my previous key takeaways from the site below, which will be followed by a detailed breakdown of more recent developments.

https://zilliqa.com/

In this section, I will cover, at length, the information that can be found on the website regarding Zilliqa and whether it serves as a useful resource for potential new users or speculators. As readers of my reports will know, I feel that a website is the primary hub for new users seeking to learn more about a project, so it is essential that this is fit for purpose.

Beginning with the homepage, we find Enterprise Ready emblazoned as the site’s tagline, with a brief overview of Zilliqa beneath it, describing it as “a high-performance, high-security blockchain platform for enterprises and next-generation applications.” Subsequently, we find Zilliqa at a glance, where the core aspects of the project are outlined, including the fact that Zilliqa was conceptualised at the National University of Singapore; has had its mainnet live since January 2019 and was the first public blockchain to successfully utilise sharding for scaling; employs Scilla as its smart contract language (created by the Zilliqa team to be safe-by-design); applies sharding to scale the throughput of the platform linearly; has over 60 project teams from over 20 countries working on Zilliqa’s ecosystem; and utilises dual mining to reduce carbon footprint, where “only 1 minute out of every 2-3 hours is needed to mine ZIL.” Overall, this is quite a concise and informative overview of the project, although perhaps something regarding current usage of the blockchain could be included here to prompt further interest.

Moving down the homepage, we find a link to an article detailing the imminent token swap, which is set for February 15th 2020. We also find links to the ZILHive, which awards grants and hosts accelerators for developers, and to the Viewblock explorer, with a brief statement on crossing 2 millions transactions in December 2019. There is also a link to learn more about Xfers, who are a fintech company based in Singapore that are developing XSGD with Zilliqa (as mentioned previously), as well as a short video on Unstoppable Domains; a Dapp for blockchain domains that has significantly increased on-chain demand for Zilliqa.

Now, looking more specifically at the informational pages on the site, let’s begin with Our Platform: here, we are given the three core aims of the Zilliqa blockchain, namely, scalability, security and decentralisation. Historically, only two of these three was simultaneously achievable for a smart contracts platform, with one almost inevitably being sacrificed (usually scalability or decentralisation). Zilliqa utilises sharding to scale linearly as demand for the blockchain increases, thus allowing for all three traits to co-exist. Further reading on this is provided via the whitepaper. We also find some interesting graphics on Zilliqa’s technical capabilities, with one showcasing its throughput of 2,800+ transactions per second against legacy blockchains’ 7-15 tx/ps. We also see how the throughput scales as the network grows, with 1,200 tx/ps possible at ~1800 nodes and 2,800 tx/ps possible at 3600 nodes.

Moving onto Language, here we find more information on Scilla, the smart contract language developed for Zilliqa specifically. It is peer-reviewed, created for user-friendliness and security (with built-in sanity-checkers and type-checkers) and is formally verifiable. Further reading links are provided here, also.

Turning to Ecosystem, we discover Zilliqa’s collaborators, including Aqilliz (a digital marketing platform), Xfers (a fintech company), Hg Exchange and ChainSecurity. Further, we find a list of Dapps, including Unstoppable Domains, Ocean Rumble and Depos. Zilliqa also have integrations from Chainlink and Moonlet, as well as Viewblock, Hummingbot and Ledger.

There is also a relatively detailed FAQ and a News and Events page that contains updates on the recent happenings within the Zilliqa ecosystem.

Blog

Regarding these more recent developments, we shall turn to the regularly updated blog, as here we can find numerous articles relating to the past eight months of Zilliqa development.

Below, I have provided key takeaways from blog posts published over the preceding 8 months, which give us a clearer idea of the present state of Zilliqa and the work completed over that period:

  • ZIP-11 (or the seed node staking project) was developed and released, with non-custodial staking live from mid-October.
  • ZILSwap – a decentralised exchange built by Switcheo on Zilliqa – was launched.
  • gZIL was conceptualised and created as a governance token, with ZIL stakers rewarded 0.001 gZIL per ZIL reward earned.
  • Zilliqa launched a staking portal called Zillion to allow users to stake ZIL and utilise gZIL voting rights.
  • ZILHive announced grants for XanPool API, Magic, Zilliqa Wallet SDK, Blockchain ETL, Zeydra, Tyron DID, Zeeves v2.0 and Switcheo Token Bridge in order to further the ecosystem.
  • Zilliqa partnered with Travala.com, with ZIL expected to be integrated as a payment option for over 3 million travel products worldwide.
  • After staking went live, within hours the network had 1bn ZIL staked. Within a week, 2bn ZIL were staked. As of today, 3.7bn ZIL is staked.
  • October saw over 1 million on-chain transactions for the first time eve.
  • Over 1 million XSGD (the Singapore Dollar stablecoin) was minted by Xfers.
  • The Pillar Protocol was launched as an algorithmic stablecoin dApp, with it being managed by6 gZIL holders.
  • There are now over 10 seed node operators, including Zillacracy, Moonlet, Viewblock, Shardpool, eZIL, CEX.io, Zilliqa Research, Staked.Us, Zillet and Atomic Wallet.

Roadmap:

The roadmap can be found here.

This is identical to the roadmap from February 2020, but progress has been updated as of June 30th, 2020.

The Zilliqa team is currently working on 14 different projects within their 2020 roadmap, which is detailed on their website. The roadmap also includes a Project Lifecycle, where we are told the process by which new developments progress, beginning with a problem and an objective, followed by research and ideation, the drafting of a proposal (Zilliqa Improvement Protocol), a review of the ZIP, approval, implementation, testing and culminating in a mainnet release.

Regarding the roadmap for 2020 itself, rather than being presented as a chronological timeline or map, we are given individual goals with a brief description, segmented by sector within the Zilliqa ecosystem. There are no dates provided nor further reading, but progress is indicated visually, with completed goals ticked off. The first section of goals is related to the core infrastructure of Zilliqa and includes the following:

  • Improving robustness (implementation in progress)
  • Efficient backend for persistent storage (completed and live on mainnet)
  • Decentralisation of storage layer (research and ideation)
  • System fuzzing (bug testing) (yet to begin)
  • Efficient smart contract sharding (research and ideation)
  • Support for zk-SNARKS (privacy) (implementation in progress)
  • Cross-chain solutions (interoperability) (yet to begin)
  • Staking mechanisms (incentivising participants) (live on testnet – this is incorrect as we know that staking is now live on mainnet).
  • Layer 2 (off-chain or state channel infrastructure) (research and ideation).

Regarding goals for Scilla, specifically, we have:

  • Efficient backend for Scilla
  • High-level language constructs for Scilla
  • Formal Verification of Scilla contracts

All of these are now in the final stages of implementation, according to the June 30th update.

We also find two final goals relating to Other Projects:

  • SDKs and dev toolchains
  • System documentation

Again, according to the June update, these are both now in the implementation phase.

Whilst the work being done here is ambitious and progress is clearly being made, it does appear that perhaps a more frequent progress update would be valuable for the community (perhaps quarterly?).

Whitepaper:

There is a highly-technical whitepaper, published in August 2017, which can be found here. This whitepaper is unfortunately beyond my means of comprehension as a technical Neanderthal, but for those that wish to learn about the precise mechanisms that comprise the Zilliqa platform in granular detail, check it out.

Wallets:

Following the token swap from ERC-20 to native ZIL in February 2020, ZIL can now be stored on Ledger hardware wallets, Moonlet, Trust Wallet, Zillet, ZilPay, Atomic Wallet, Infinito Wallet, Math Wallet, ZILCLI_, ZHIP, Equal, Guarda and Crypto.com.

And that concludes my fundamental analysis of Zilliqa.


Technical Analysis

ZIL/USD

Weekly:

ZILUSDWeekly

Daily:

ZILUSDDaily

ZIL/BTC

Weekly:

ZILBTCWeekly

Daily:

ZILBTCDaily

As we can see from the above charts, ZIL has now been trading for close to three years, beginning early trading in late January 2018.

If we begin by looking at ZIL/USD, we can see that price initially sold off for several weeks before finding support at $0.03 in March, then experiencing its first mini bull cycle that pushed it to an all-time high of $0.23 in May. Price then began its extended bear market with the rest of the cryptosphere, trending down for two years until the March 2020 capitulation, where it formed its all-time low at $0.0026. Since, it has broken out of its long-term down trend, rallying as far as the most important historical pivot at $0.03, where it found resistance in June. Since, ZIL has been range-bound between $0.012 as support and $0.03 as resistance, with price now looking to break out above the pivot. If we do see a weekly close above this level, I would expect to see continuation towards the all-time high, particularly in the context of current market conditions, but resistance will likely be found at $0.058 and $0.095 before that. Ultimately, I do expect the pair to at least retest the $0.23 all-time high in 2021.

Turning to ZIL/BTC, the most important thing to note here is that price spent 266 days range-bound between August 2019 and May 2020, with the all-time low around 50 satoshis acting as range support and 100 satoshis acting as range resistance. Price then broke out of that range and rallied on rising volume towards that 360-satoshi pivot, which was support for over a year before turning resistance earlier in ZIL’s existence. That area proved too tough to crack at first, and price has since spent several months in a low-volume pullback towards that range resistance at 100 satoshis, with the most recent week showing signs of reversal for the beginning of a second leg higher on the fourth-highest weekly volume of all-time. If we look at the daily, we found support at the 360dMA, and I am now looking for a breakout above 195 satoshis to open up a retest of 360 satoshis. Close above that important level and I would expect the cycle to accelerate, although I do not expect this pair to hit its all-time high to be honest, as it would imply a near-$5bn market cap. This is certainly within the realm of possibility given particularly frothy market conditions, but I would not be holding in anticipation of such extremes. I do however think that the 1,000 satoshi area will be tested as resistance in 2021.

And that concludes my evaluation of Zilliqa.


Conclusion

This report is now approaching 6,000 words, and it is time to draw it to a close.

My final grading for Zilliqa is 9 out of 10.

Here, you can find my grading framework, for reference.

Lastly, here is a link to a Google Sheets file with any significant data from previous reports compiled for cross-comparative purposes. I will keep this updated as I continue to write these reports.

I hope this report has proved insightful and that you’ve enjoyed the read! Please do feel free to leave any questions in the Comments, and I’ll answer them as best I can.


 

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This Post Has One Comment

  1. martin vojkuvka

    good work.

    You can include in the weekly report on Thorchain. Thank you

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