Crash Course — SKALE Network

SKALE Network project

The SKALE Network is a high-throughput, low-latency, configurable byzantine fault tolerant, elastic blockchain network built interoperably with Ethereum. The initial and primary use case for this network will be in form of elastic sidechains for the Ethereum Blockchain.

SKALE gives an ability to developers to create sidechains for particular applications, which are “protected” by validators of the blockchain network, and it also can speed up the development of smart-contracts.

The network of dApps works with a principle of Ethereum-as-a-Service. With the help of sidechain applications can get access to third party blockchains and their dApps, for example to improve performance and security. SKALE performs with Ethereum blockchain through smart-contracts of a SKALE Manager.

Benefits of using SKALE.

The primary benefits of using an elastic sidechain are faster commit times, greater throughput, and lower transaction costs. The advantages of using the SKALE Network in particular include a robust security model (based on random selection and frequent rotation of validator nodes), virtualized and containerized validator nodes, variable chain sizes, expandable on-chain storage options, BLS rollups, full EVM and Web3 compatibility, and more:

Zero to Near-Zero Gas Fees

Random Node Selection/Frequent Node Rotation

Virtualized Subnodes

Containerized Validator Nodes

Consensus via Asynchronous Binary Byzantine Agreement (ABBA)

BLS Rollups

Node Monitoring

Ethereum Interoperability

Skale Network

Node Creation

To be added as a node to the system, a prospective node must run the SKALE daemon which will evaluate the prospective node to ensure that it is upholding network hardware requirements. If the prospective node passes this verification step, the daemon will permit it to submit a request to join the network to the SKALE.

Node Destruction

When exiting the network, nodes must first declare their exit and wait a finalization period. After this 6-finalization period (e.g., two days), the node will be inactive and able to withdraw their initial stake from the network.

Elastic Sidechain Creation

When creating an Elastic Sidechain, consumers select their chain’s configuration and submit payment to the SKALE Manager for the duration of time that they wish to rent network resources required to maintain their Elastic Sidechain. After a creation request has been received by the SKALE Manager, a new Elastic Sidechain will be created and its respective endpoint returned to the creator. If there are not ample resources available in the network to support creation of the desired Elastic Sidechain, the transaction will be canceled, and the user will be notified.

Virtualized Subnode Shuffling

When creating an Elastic Sidechain, developers are provided with the option of enabling virtualized subnode shuffling as an added security measure. Shuffling is encouraged to mitigate any collusion attempts by virtualized subnodes within each Elastic Sidechain and is facilitated through the SKALE Manager in a similar fashion to the node exiting process.

Elastic Sidechain Destruction

Destruction of an Elastic Sidechain occurs when a consumer’s rental deposit for network resources has been exhausted or a consumer has flagged their Elastic Sidechain for deletion. Prior to the exhaustion of their rental deposit, the creator will be notified of their chain’s pending deletion and given the opportunity to add additional time to the chain’s lifetime.

Bounty Issuance

At the end of each network epoch, the number of SKALE tokens minted for that period are divided equally amongst all nodes which were participating in the network prior to the epoch beginning. Any tokens which are not issued to nodes as a result of poor uptime / latency will be issued to the N.O.D.E. Foundation.

Elastic Sidechains

The initial implementation of the SKALE Network will offer Elastic Sidechains comprised of virtualized subnodes which engage in block creation and commitment through an asynchronous, leaderless, and provably secure protocol. Such a protocol was designed to exhibit robustness in the case of virtualized subnode downtime where each latent / down virtualized subnode is regarded as a slow link.

The SKALE Network also offers interchain messaging which lets dApps perform state updates in coordination with the mainnet. All with high-grade security and safety. Lastly each SKALE chain provides File Storage functionality to dApps letting them run end-to-end decentralized apps, websites, games, etc.

SKALE Virtualized Subnodes

Compared to other protocols, Virtualized Subnodes are not restricted to a one-to-one mapping between participating nodes in the network. Each Sidechain is comprised of randomly appointed virtualized subnodes. They run SKALE daemon and run SKALE consensus. Containerized virtualized subnode architecture gives an opportunity for each node to run multiple Elastic Sidechains simultaneously. Subnodes within a SKALE Node are referred to as Virtualized Subnodes. Each Virtualized Subnode participates in independent Elastic Sidechains.

SKALE Protocol

SKALE follows a Proof-of-Stake system where each node must stake a predetermined amount of SKALE (SKL Tokens). Holders of SKL can also delegate their tokens to any node in the network that does not already have the maximum number of tokens staked / delegated.

Most sidechain protocols are insecure. The reason is that most solutions have a small set of nodes validating each chain which are usually fixed and do not change. With this type of arrangement, application developers can encounter some serious risks at the consensus layer — risks that include collusion, bribery, and other bad things that can impact the validity of your transactions.


The SKALE token is a hybrid use token which represents the right to work in the network as a validator, stake as a delegator, or access a share of its resources by deploying and renting an Elastic Sidechain for a period of time as a developer.

Users pay SKALE in a subscription-model to rent these resources (computation, storage, bandwidth) for a predetermined amount of time in the form of an Elastic Sidechain.

Validators stake SKALE into the network and then gain the right to run nodes and earn both fees and tokens via inflation. Delegators may delegate their tokens to validators and earn rewards.

SKL Tokens are released on the Ethereum platform according to the standard ERC-777 which compared to ERC-20 gives a chance not to delegate them directly to the validator and just give him only a secure delegation key. At the same time, the SKL tokens themselves remain in the holder’s crypto wallet.

Conclusion on the SKALE Network

Decentralized networks allow for a new wave of business models and organizational structures to come to light. Their potential for societal and business impact have been well documented as have their short-comings with regards to performance, usability, and cost-effectiveness.

The main goal of developing a SKALE Network is to solve the technical problems of scalability, user experience, and cost issues affiliated with decentralized networks such as Ethereum. In addition, SKALE is designed to bring application specific architecture to developers resulting in enhanced configurability and modularity.

SKALE proposes a decentralized, configurable network of on-demand blockchains that support high-throughput, low-cost, and low-latency transactions enabled with storage capabilities and advanced analytics.

Here is more information on the SKALE Network:









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