Huione: A New Architecture for High TPS and Scalability

Disclaimer

The contents of this white paper are intended solely for informational purposes and do not constitute any offer to sell or purchase any coins (digital assets) or to participate in platform investments. The information or analysis provided herein does not constitute investment advice. Potential users should clearly understand the risks associated with Huione Chain (hereinafter referred to as “Huione”). By participating in the investment, investors acknowledge that they are aware of and accept the risks associated with this project.

Currently, there are certain countries around the world where regulations regarding blockchain projects and fundraising through digital coins are unclear, creating the possibility of losses for participants due to legal or policy changes. Investors making independent decisions must fully accept these risks and are willing to bear all corresponding consequences. These risks include, but are not limited to: policy risk, regulatory risk, compliance risk, economic cycle risk, network hacking risk, management risk, risks specific to the digital currency industry, price volatility risk, and other unspecified risks.

Nothing in this white paper should be construed as a guarantee or commitment regarding how Huione's business or coins will develop, or the utility or value of the coins. This white paper outlines current plans, which may change at any time. Their success will depend on numerous factors beyond Huione's control, including market conditions, data, and factors within the cryptocurrency industry. Any statements regarding future events are based on Huione's analysis of the issues discussed in this white paper, and this analysis may ultimately prove to be incorrect.

Users participating in Huione related services must comply with local laws and regulations, and assume all risks.

Abstract

Huione is a high TPS and highly scalable public blockchain that utilizes Proof of Stake (PoS) as its consensus algorithm and incorporates Proof of History (PoH) and Proof of Replication (PoRep) into its architecture, aiming to provide high TPS and scalability. The protocol's TPS far exceeds 50,000, ensuring faster transaction speeds and lower costs, with each transaction costing significantly less than $0.005 and being completed within 300 to 400 milliseconds without waiting. As the network and hardware are upgraded, transactions will become even more efficient.

The HC coin issued within Huione is a crucial component of the Huione ecosystem. It serves not only as a platform coin but also as a key driver for the development of the public blockchain ecosystem. Through mechanisms such as airdrops and staking, the HC coin ensures fair distribution of public chain profits and fosters active community participation and value creation.

1. Introduction

1.1 Overview

The inception of Huione is rooted in a deep understanding of existing blockchain technologies and a precise grasp of market demands. It aims to address the limitations of current blockchains in terms of transaction speed, cost, and scalability, providing a more efficient and low-cost trading experience through an innovative technological architecture. This meets the market's need for high-performance blockchain platforms. Every transaction and fee payment within the Huione settlement system injects new value into the exchange.

As the platform coin of Huione, the HC coin plays multiple roles within the Huione ecosystem. Through incentive mechanisms such as transaction mining, it ensures fair distribution of public chain profits and promotes active community participation and value creation. The issuance and release mechanism of the HC coin considers various stakeholders, including ecosystem project parties, investors, teams/communities, and individuals, ensuring fair distribution and effective incentives. Users can acquire HC coins through participation in the public chain’s BVI Airdrop (Behavioral Value Incentive Airdrop), staking, and community governance.

The application scenarios for HC coins are diverse, including but not limited to BVI Airdrop, staking rewards, and community governance. Holders of HC coins can earn rewards through staking; moreover, HC coins will also be used for community governance, allowing holders to participate in decision-making processes of the public chain. Additionally, the HC coin features a highly decentralized issuance system, with project issuance rights delegated to the community, enabling the community to determine the project’s issuance price and volume.

1.2 Slogan

Huione — Exciting because of you!

1.3 Value Proposition

Everyone creates value, and value returns to everyone. In the Huione public chain, every participant is not only a creator of value but also a beneficiary of it. We believe that through collective effort and innovation, we can build a fairer and more prosperous digital economic ecosystem.

1.4 Positioning

A leading behavioral value incentive public chain, Huione aims to become a decentralized co-creation infrastructure. Through the HC platform coin, it facilitates seamless trading and circulation of assets, allowing everyone to participate in and own the value creation of Web3.

1.5 Technical Features

The technical features of the Huione public chain include:

High Performance: Efficient transaction processing capabilities ensure rapid response and handling of a large volume of transactions.
Security: A high level of security safeguards user assets and transaction integrity.
Smart Contract Support: Comprehensive support for smart contracts provides a solid technical foundation for the circulation and application of HC platform coins.

1.6 Community Governance Structure

The community governance structure of the HC platform coin emphasizes democracy and transparency, ensuring that all participants can play a role in the decision-making process and collectively drive the continuous development and innovation of the public chain.

2. Vision and Goals

Vision: To become a decentralized co-creation infrastructure that enables seamless trading and circulation of assets through the HC platform coin, allowing everyone to participate in and own the value creation of the Web. Together, we aim to build a new, high-performance, permissionless blockchain.

Goals: To drive technological innovation and promote the prosperous development of the ecosystem and community, while ensuring the security and stability of transactions, achieving fair distribution and maximization of value utilization.

Security and Stability: To ensure the security and stability of transactions, providing users and organizations with a reliable digital asset trading platform.
Technological Innovation: To promote technological innovation, continuously optimizing the performance and security of the public chain to adapt to changing market demands.
Ecosystem and Community Prosperity: To foster the prosperous development of the ecosystem and community, encouraging more participants to join and contribute through incentive mechanisms and community governance.
Fair Value Distribution: To achieve fair distribution and maximization of value, ensuring that every participant can benefit from the development of the public chain ecosystem.

3. Mission and Values

Mission: To return value to individuals, ensuring that every participant can benefit from the development of the public chain ecosystem.

Values: Innovation, Fairness, Altruism, Co-Creation.

Huione provides participants with a comprehensive platform for understanding and engaging in the development of the digital economy through its unique technological architecture and community governance mechanisms. Additionally, Huione draws on some successful experiences from Solana, such as its high-performance transaction processing capabilities, comprehensive support for smart contracts, and its decentralized and censorship-resistant characteristics. These are key elements in building a robust public chain. Through these technological features and community governance structures, Huione aims to offer users a secure, efficient, and fair infrastructure platform.

4. Technical Architecture

4.1 Consensus Mechanism

4.1.1 Proof of Stake (PoS)

Huione employs Proof of Stake (PoS) as its core consensus mechanism, selecting validators through the staking of HC coins. The selection of validators is based on the number of coins they hold and their historical performance, ensuring the decentralization and security of the network. Each validator is required to lock a certain number of HC coins, which cannot be used during their validation period, thereby ensuring their accountability for network activities. Validators compete to generate blocks and earn rewards and transaction fees from them. To prevent malicious behavior, Huione has implemented a strict penalty mechanism to ensure the honesty of validators during the consensus process.

4.1.2 Proof of History (PoH)

Proof of History (PoH) is a computational sequence that enables high throughput and low-latency transaction processing. PoH generates a series of ordered timestamps using a Verifiable Delay Function (VDF), which serves as the basis for transaction ordering. Because the transaction sequence is linear in time, PoH allows the network to quickly verify transactions without global synchronization. This significantly enhances Huione's transaction processing efficiency, supporting over 50,000 transactions per second (TPS) and ensuring the efficient operation of the network.

PoH provides a cryptographic method for validating the passage of time between two events. It processes data using a cryptographic secure function, ensuring that the output cannot be predicted from the input; users must fully execute the function to generate the output. The function operates sequentially on a core, with its previous output serving as the current input, regularly recording the current output and the number of times it has been called. External computers can then parallelly recompute and verify outputs by checking each segment of the sequence on individual cores. By adding data (or hashes of certain data) to the function's state, the data can be encapsulated into timestamps and incorporated into the sequence. The state, index, and data are appended to the sequence, producing a timestamp to ensure that the data was created before the hash of the next sequence is generated. Multiple generators can synchronize with each other by mixing their states into their respective sequences, supporting horizontal scalability.

4.1.2.1 Description

The system is designed to operate as follows:

Starting with a random value, a hash function is run, and the output is used as input to run the function again. The number of function executions and the results of each call are recorded. This count provides support in both sequential and temporal dimensions; outputs are linked head-to-tail to form a complete proof chain.

The random value can be selected from various sources, such as the headline of the New York Times for that day or other factual data.

For example:

As long as the chosen hash function is collision-resistant, this hash set can only be computed sequentially by a single thread. This satisfies the condition that at index 300, one cannot achieve such a result without actually running the algorithm 300 times.

Therefore, we can infer the true passage of time from index 0 to index 300 from the data structure. Each time a hash is generated, it is akin to a grain of sand falling into an hourglass.

As illustrated below, when the count is 510,144,806,912, the hash value is 62f51643c1; when the count is 510,146,904,064, the hash value is c43d5862d88. Based on the aforementioned PoH algorithm, we can confidently assert that time has passed between the counts of 510,144,806,912 and 510,146,904,064.

4.1.2.2 Event Timestamps

The hash sequence can also be used to record data. By using a "combine" function to merge data with the hash value, the data portion can be simplified to the hash of any event data. In this case, the generated hash represents the timestamp of the data, as it is created after the specified data has been inserted.

For example:

At this point, some external events occur, such as taking a photograph or the creation of other data:

The calculation of Hash336 is derived from the combination of Hash335 and the SHA256 of the photograph, followed by the result of a SHA256 hashing process. The index and the SHA256 of the photograph will be recorded as part of the output sequence. Consequently, anyone can verify the reliability of the data, and this verification can even be performed in parallel.

Since the entire process is executed in a sequential manner, we can assert that events entering the queue must have occurred before a computed hash event in the future.

As shown in Table 1, photograph2 was created before hash600, while photograph1 was created before hash336. Inserting data into the hash sequence will cause changes throughout the subsequent subsequence.

In Figure 3, the input cfd40df8... is inserted into the PoH sequence, with a counter of 510,145,855,488, and the final inserted hash is 3d039eef3.

All subsequent hash values will be modified due to this change, which is highlighted in different colors below.

Each node discovering this sequence can determine the order of all events through the sequence and assess the actual time between the two insertions.

4.1.2.3 Verification

The sequence can be verified using multi-core CPUs, significantly reducing the time compared to generating the sequence.

For example:

For example, if a GPU has 4,000 cores, the verifier can split the hash sequence into 4,000 parts to perform parallel computations, ensuring that each segment—from the initial hash to the final hash—is correct.

Sum_Hash：Total Hashes.

Sec_Hash：Hashes per Second per Core.

Nuc_Verified：Verifiable Number of Cores.

\frac{{Sum}_{Hash}}{{Sec}_{Hash}}

The expected time to verify the sequence is:

\frac{{Sum}_{Hash}}{（{Sec}_{Hash} \ast {Nuc}_{Verified}）}

4.1.2.4 Consistency

Under any circumstances, users expect the generated sequence to maintain consistency and prevent the insertion of events after the last inserted event.

To prevent malicious leader nodes from forging sequence data, each leader, when generating a sequence, uses the first hash from the last hash of the previous sequence it trusts.

To prevent leader nodes from rewriting events, each event is the result of a user signature.

4.1.3 Proof of Replication (PoRep)

Huione also integrates the Proof of Replication (PoRep) mechanism, a technology that ensures data storage integrity and security. PoRep prevents nodes from cheating by requiring storage nodes to periodically prove that they hold a complete copy of the data. Combined with Proof of History (PoH), PoRep further enhances Huione's data security, ensuring that all data stored on the chain is authentic and complete. This mechanism is crucial for supporting decentralized storage and applications, especially when handling large-scale data and file storage.

4.1.4 Leader Rotation

Huione's cluster requires only one validator to generate ledger entries at any given time, ensuring that all validators can consistently replay the same ledger.

To mitigate the risk of a single leader censoring votes or transactions, the cluster employs a leader rotation mechanism. This mechanism reduces the impact of malicious behavior by rotating the leader role at each slot. All validators select the expected leader based on the same algorithm, and when validators receive signed ledger entries, they can confirm that they were generated by the designated leader. The leader schedule is the ordered plan of leaders for all slots and is periodically recalculated locally.

4.1.4.1 Leader Schedule Generation

The leader schedule is generated by epoch, with each epoch being a predefined period. Validators continuously update their root fork while voting and generate new schedules based on blocks spanning epochs. If a fork is skipped, validators regenerate the leader schedule immediately after the root update to ensure system consistency.

4.1.4.2 Leader Schedule Offset

The leader schedule offset determines the time interval between schedule generation and the leader role taking effect. The longer the offset period, the lower the likelihood of inconsistencies in leader scheduling.

To address network partitions, the duration of the schedule offset should be significantly longer than the expected time for forks to be committed to the root. After sufficient observation, the cluster can adjust the offset time based on the duration of partitions and their standard deviation to ensure scheduling consistency.

4.1.4.3 Genesis Leader Schedule

In the genesis block configuration, the first epoch's initial leader is specified, and this leader serves for the first two epochs. The leader schedule is generated using a predefined random seed to ensure unbiased and unpredictable results.

4.1.4.4 Leader Schedule Attack Mitigation

Seed Attack: The chosen seed is predictable but unbiased, avoiding the possibility of grinding attacks.
Active Set Attack: A leader might influence the active set by censoring votes, but the sampling duration is long enough to reduce the likelihood of censorship.
Stake Censorship: Leaders might also censor new stake transactions. To prevent such attacks, the system calculates the active set at the schedule offset boundary.

4.1.4.5 Schedule Lifecycle

Each leader schedule's lifecycle spans one epoch, which is divided into multiple slots, with each slot's leader operating in sequence. If a leader fails, the next leader takes over and generates tick signals to fill the gap.

4.1.5 Turbine Block Propagation Mechanism

Huione employs a layered block propagation mechanism called Turbine to efficiently broadcast transaction fragments to all nodes, reducing redundant messages.

Neighborhood Division: The cluster is divided into small node groups based on location, called neighborhoods. Each node shares data with other nodes in its neighborhood and forwards part of the data to nodes in the next layer. Each node only needs to communicate with a few nodes, reducing network load.
Data Broadcast Process: During its slot, the leader node sends transaction data fragments (shards) to the neighborhood at layer 0. Validators in layer 0 share the fragments with their neighbors and further transmit them to layer 1. This process continues until all nodes in the cluster receive all fragments.
Neighborhood Structure and Hierarchy: Turbine uses a Data Plane Fanout mechanism, where nodes in each layer broadcast according to a predetermined fanout degree (e.g., 2, 4). Layer 0 starts with fewer nodes, and subsequent layers expand, with each layer having a multiple of the previous layer's nodes. This structure ensures efficient data propagation throughout the cluster.
Neighborhood Assignment and Weighted Selection: The entire cluster sorts validators by stake to form neighborhood boundaries. The leader selects high-stake nodes to form layer 0, and the remaining nodes are similarly assigned to different layers. A random neighborhood tree ensures each fragment propagates through a random path, reducing attack risks.

4.1.5.1 FEC Calculation in Turbine Mechanism

Forward Error Correction (FEC) is crucial in Turbine for handling data loss due to network packet drops.

4.1.5.1.1 FEC Rate Calculation

The FEC rate determines the fault tolerance of a shard group. For example, with a 16:4 FEC rate, up to 4 out of 20 shards can be lost without causing the entire shard group to fail.

4.1.5.1.2 Calculating Shard Group Failure Probability

The failure probability of a shard group can be calculated using a binomial distribution, based on the following parameters:

Network packet loss rate: P=1−(1−NPLR)^2

FEC rate: K:M

Number of trials: N=K+M

For example:

With a network packet loss rate of 15%, the packet failure probability P is approximately 0.2775.

For an FEC rate of 16:4 (group size of 20), the shard group failure probability S can be calculated using the binomial distribution, resulting in approximately 0.689.

4.1.5.2 Block Generation Success Rate

The probability of successfully generating a block is closely related to the failure rate of the shard group. Based on the FEC rate, the higher the network packet loss rate, the lower the block success rate. For example:

At a 16:4 FEC rate, the probability B of successfully generating a block is extremely low, approximately 10−203.

At a 32:32 FEC rate, the success rate significantly increases to 0.99045.

4.1.5.3 Community-Level Fault Tolerance

The neighborhood hierarchy in Turbine provides robust fault tolerance for data transmission within the community. Even if some nodes within a neighborhood fail, data can still be retransmitted by other nodes from upper-level neighborhoods, reducing the risk of overall system failure.

Through this layered fanout and error correction mechanism, Turbine offers efficient block propagation, capable of adapting to various network conditions and ensuring data integrity.

4.2 Network Structure

Huione adopts a distributed node architecture where each node operates independently, participating in consensus, transaction processing, and data storage. A leader node is dynamically designated within the network to generate the Proof of History (PoH) sequence, providing a consistent and verifiable passage of time for the network. The leader node orders user messages, ensuring that other nodes can efficiently process transactions in sequence, maximizing network throughput.

The leader node maintains the current state in RAM and executes transactions, then publishes the signed transactions and state to the validator nodes. These validator nodes execute the same transactions on their own state copies and publish state signatures as confirmations, forming the consensus algorithm's votes. In a non-partitioned state, only one leader node operates at any given time, but all validator nodes have the potential to become leaders and rotate dynamically through a PoS-based mechanism.

In terms of network communication, Huione uses an optimized P2P protocol to achieve fast communication between nodes, ensuring low latency and high throughput. Node collaboration is accomplished through block propagation, state synchronization, and transaction broadcasting, ensuring that each node can quickly receive the latest transaction information and block data. This ensures low latency and high throughput, enabling Huione to handle a large number of concurrent transactions.

According to the CAP theorem, Huione prioritizes consistency over availability in the event of a network partition, ensuring data consistency and integrity. Additionally, the network is designed with a mechanism to regain control from partitions of any size in the event of a large partition, minimizing the impact on users.

4.3 Huione Cluster

Huione Cluster (hereinafter referred to as the Cluster) is a group of cooperating computers that can be viewed as a single system from the outside. It is a decentralized network composed of multiple validator nodes that collaboratively process transactions and maintain the blockchain ledger. The Cluster is created by bootstrapping the genesis configuration of the validators and uses an optimized P2P communication protocol to ensure fast synchronization and interaction between nodes. Multiple clusters can exist simultaneously and operate independently based on different genesis blocks. When multiple clusters share the same genesis block, they attempt to merge. Otherwise, each cluster ignores the others, achieving independent distributed ledger maintenance.

4.4 Validators

Validators widely adopt an optimization technique common in CPU design called pipelining. This technique is suitable for scenarios where input data streams need to be processed through multiple steps, with each step executed by different hardware components.

4.4.1 How Pipelining Works

Pipelining can be likened to the automation of a laundry process. Suppose washing, drying, and folding are independent steps that must be performed sequentially. To improve efficiency, you would start washing the second batch of clothes as soon as the first batch finishes washing, while the first batch is drying. This way, multiple stages run in parallel, significantly enhancing the overall processing speed.

In this example, the washing machine, dryer, and folding are independent stages in the pipeline. The overall processing speed of the pipeline is determined by the slowest stage, known as the pipeline bottleneck.

4.4.2 Pipelining Design in Validators

In blockchain validators, the pipelining architecture is used to optimize transaction processing and is divided into two modes:

TPU (Transaction Processing Unit) Mode: Responsible for generating ledger entries, where the leader packages and submits transaction data during its slot.

TVU (Transaction Validation Unit) Mode: Responsible for validating these transactions to ensure they meet the consensus protocol requirements.

Although the pipelining functions of these two modes differ, they utilize the same hardware resources, including:

Network Input: The entry point for receiving data packets.
GPU: Used for accelerating parallel computations.
CPU: Responsible for executing the main processing tasks.
Disk Write: Writing data to local storage.
Network Output: Broadcasting the processed results to the network.

4.4.3 Parallel Processing in Pipelining

In both TPU and TVU modes, the pipelining design ensures efficient utilization of these hardware resources. The TPU focuses on creating and processing transactions, while the TVU focuses on verifying the correctness of these transactions. Through parallel processing in the pipeline, both modes significantly increase transaction processing speed, enabling validators to handle multiple tasks simultaneously, reduce latency, and maintain efficient block production and validation.

4.4.4 TPU

The Transaction Processing Unit (TPU) is the core logical component used by validators for block production. It is responsible for processing incoming transactions from the network and packaging them into new blocks through a series of steps. Validators use the TPU to receive transaction requests from clients (other validators or users) and ensure these transactions are efficiently processed and broadcasted across the entire network.

4.4.4.1 TPU Workflow

Fetch Stage

Data Reception: The TPU receives transaction requests from clients, encapsulated in UDP packets.

Packet Merging: The system allocates memory to accommodate the received packets and reads them from the network socket, subsequently merging them into processable batches.

Signature Verification Stage (Sigverify Stage)

Deduplication: The system deduplicates the received packets, filtering out duplicate transaction requests.

Signature Verification: Each transaction packet's signature is verified for validity. Invalid or malicious transactions are flagged for discard by the TPU, preventing them from entering subsequent stages.

Banking Stage

Decision Processing: The TPU decides how to handle the transaction packets: whether to forward them to downstream nodes, retain them for further confirmation, or process the transaction.

Block Producer Logic: If the node is the block producer for the current slot, the TPU processes the retained transactions through its in-memory bank structure and continues to receive and process new transactions.

Broadcast Stage

Data Packaging: Valid transactions generated from the banking stage are packaged into shreds, then prepared for network broadcast.

Turbine Block Propagation Mechanism: With the help of the Turbine tree structure, these shreds are distributed to validator nodes in the network, ensuring the consistency of the distributed ledger across the network.

Serialization and Signing: Before broadcasting, the shreds are serialized and signed with the validator's key to ensure their security and integrity. Additionally, erasure codes are generated for the shreds to facilitate data recovery in case of packet loss during network transmission.

The TPU enhances the efficiency of validator nodes in processing a large volume of transactions through multiple parallelized steps. By employing effective signature verification and broadcasting mechanisms, it ensures the security and consistency of the entire network. Its pipelined design allows validators to produce blocks efficiently and with low latency, supporting high transaction throughput.

4.5 Scalability and Performance

Scalability and performance are among Huione's core strengths, achieved through various technological means to deliver ultra-high TPS and robust scalability. Firstly, Huione employs sharding technology, distributing transaction and data processing tasks across multiple parallel shards, reducing the load on individual nodes. Secondly, Huione introduces parallel processing mechanisms, allowing multiple transactions to be processed simultaneously without blocking each other. Combined with the time-ordering functionality of PoH, these technologies collectively support Huione's large-scale global applications.

4.6 Security Design

To ensure system security, Huione adopts multi-layered protective measures. Firstly, at the consensus level, the combination of Proof of Stake (PoS) and Proof of History (PoH) ensures the difficulty and cost of malicious behavior. Secondly, Huione employs advanced encryption algorithms to protect users' transaction data and privacy. Additionally, Huione has designed mechanisms to resist DDoS attacks and Sybil attacks, ensuring network stability and continuity. Through continuous security audits and vulnerability detection, Huione ensures its system can withstand various known and unknown attacks.

4.7 Smart Contract and DApp Support

Huione provides robust support for the development of smart contracts and decentralized applications (DApps). Huione adopts a high-performance smart contract execution environment that supports multiple programming languages, including Rust and C++. Developers can quickly build and deploy DApps using the toolchain and APIs provided by Huione. The execution of smart contracts is optimized through parallel processing and sharding technology, ensuring efficient and low-cost operation. Additionally, Huione's decentralized storage and data security mechanisms provide strong backing for DApps, enabling them to run in a secure and efficient environment.

5. Coin Economics

5.1 Total coin Supply

The total supply of HC platform coins is fixed at 10 billion, with no further issuance.

5.2 Coin Distribution Plan

5.3 Coin Incentive Mechanism

5.3.1 BVI Airdrop

The BVI Airdrop aims to address current issues in the Huione Chain model by introducing a staking mechanism and phased airdrop strategy, enhancing coin value stability and market participation.

This plan is implemented by obtaining GV values through methods such as transaction volume GV value, staking GV value, transaction flow GV value, and completing specific tasks. These GV values are then converted into HC coins at a certain ratio, establishing a unique reward mechanism for ecosystem projects, organizations, and individuals. The main goal is to attract users to engage in more transactions, thereby increasing platform activity and transaction volume.

Rewards are distributed based on an Epoch settlement phase, with the reward amount dynamically configured according to actual transaction activity, ensuring a smooth annual release rate. After calculating the weight index of each node, the corresponding GV values are allocated to the designated wallet addresses of the nodes.

5.3.1.1 Equity Application

Projects, organizations, or individuals can apply for USDT staking on the Huione staking platform to obtain the corresponding node identity. Upon successful application, they will receive a proportional amount of GV values, which will be associated with the application address. Ecosystem projects establish associations with account addresses based on actual transactions without binding; one account address can participate in multiple project transactions. Organizations need to establish a strong association with the account address by transferring at least 0.01 HC to the address for the first time. Once associated, it cannot be unbound or changed. An account address can only be bound to one organization. If the organization account address transfers HC to another address, and the other address receives HC for the first time, it will automatically associate with the organization. After the association is completed, the transaction flow data of this address will be closely related to the associated project or organization. The larger the transaction volume or flow, the more GV values obtained, and the more rewards received.

5.3.1.2 Application Threshold Ratio

By setting a threshold for equity applications (BVI Airdrop node identity) as a prerequisite for participating in GV value conversion, this measure ensures the fairness and effectiveness of GV value conversion. This means that participants must meet certain conditions to qualify for GV value conversion, aiming to increase participant engagement, establish a more stable and active community environment, and ensure the long-term healthy development of the network. The threshold ratios are as follows:

5.3.1.3 GV Value Rewards

Upon obtaining an identity through staking coins, Huione provides both static and dynamic GV value rewards. Each identity's equity and GV values differ, enhancing participant engagement and involvement, and helping to introduce more vitality and activity into the Huione ecosystem.

Static GV Value Rewards

Staking Base Reward GV Value: When participants stake the minimum threshold amount of coins (staking amount equals the threshold), they receive a fixed base GV value reward. Refer to section 5.3.1.2 for the corresponding values.

Task Completion Reward GV Value: Participants receive GV value rewards upon completing specific tasks.

Dynamic GV Value Rewards

Additional Staking GV Value Reward: If participants stake more coins than the minimum threshold, they receive additional staking reward GV values based on the excess amount and their identity's weight factor.

Staking Period Interest Reward: Each participant must stake coins for a minimum period of N years (N being at least 1). During this period (N∗365), the staked coins cannot be freely disposed of (if the staked amount exceeds the minimum threshold, the excess can be freely disposed of, but the final annual interest yield will be calculated based on the total staked amount at the time of data collection). Participants can retrieve their staked coins after the staking period expires or choose to reinvest based on their needs. Huione will settle the GV value rewards monthly, dividing the annual interest rate into 12 parts and settling at the last Epoch of each month. The longer the staking period, the higher the annual interest yield, and thus the higher the monthly GV value rewards.

Staking Duration (Days)

Reward GV

Transaction GV Value Rewards

For Individual Nodes (User Behavior):

Transaction Count Record: Each transaction records 1 GV. The number of transactions reflects user activity, with each valid transaction (excluding transfers or token migrations) contributing to the GV value.
User Minting USDH: Each minting of USDH earns 2 GV. However, it must be new capital inflow, meaning only USDH entering Huione from external cross-chain sources counts. Transfers within the system or conversions of existing funds do not count.

For Organizational Nodes (Team Behavior):

Transaction Count Record: Each transaction records 1 GV, with valid transaction behavior from each address under the organization contributing to the organization's GV value. The higher the activity within the organization, the faster the growth of GV value.
Minting USDH: Similarly, only new capital entering through cross-chain transfers can earn a record of 2 GV; internal transfers do not count. Encouraging more external users to participate in the organization's activities can enhance GV value.

For Project Nodes (Project Development):

Transaction Count Record: Each transaction records 1 GV. Each valid transaction of the project will be counted as GV value, incentivizing more trading behavior between projects.
Transaction Flow Record: Each unit of transaction flow records 1 GV. Large transactions will earn more GV value rewards through increased flow.

5.3.1.4 KPI Assessment

The core assessment indicators for GV value include:

Minting USDH: Only new USDH inflows into the system are assessed.

Transaction Count: Tracking all valid transactions within the ecosystem.

Transaction Flow: Focusing on large transactions related to specified assets such as HC, USDH, USDT, and BTC.

Staking Duration and Amount: The longer the staking duration and the larger the amount, the more GV value is obtained.

5.3.1.5 Calculation of Stage Rewards

Definition of Basic Variables

GV_identity: GV value obtained within time t.

R_t: Ratio of GV value converted to HC within time t.

P: Staking period adjustment factor, adjusted based on the length of the staking period.

M_t: Market feedback adjustment factor within time t, adjusted based on market conditions and coin circulation.

Setting the Base Reward Function

The base reward function can be defined as follows:

Reward_t=GV_{identity}×R_t×P×M_t

Reward_t is the total reward in HC coins for time t.

Calculating GV Value for Each Identity

The GV value for each identity can be calculated using the following formula:

GV_{identity}=GV_{Basic}×GV_{Extra}×GV_{Transaction}×GV_{Flow}

GV_Basic: Base GV value reward.

GV_Extra: GV value obtained based on the staking period and additional measures.

GV_Transaction: Transaction base GV value.

GV_Flow: Transaction flow reward GV value.

Staking Period Adjustment Factor ( P )

r_0: Base annual interest rate (e.g., 10% or 0.10).

r_i: Annual interest rate for the i−th year, where i represents the number of staking years.

P_i: Staking period adjustment factor for the i−th year.

Calculating the Annual Interest Rate for Each Year:

Assuming the annual interest rate increases by a fixed proportion k (e.g., 5% or 0.05) each year, the annual interest rate for the i−th year is:

r_i=r_0×(1+k)^{i-1}

Calculating the Staking Period Adjustment Factor ( P ):

P_i=\frac{r_i}{12}

At each Epoch settlement, based on the current month and year, calculate the reward for the last Epoch of the month

Market Feedback Adjustment Factor ( Mt )

The market feedback adjustment factor M_t is dynamically adjusted based on the market circulation of HC coins and transaction activity to ensure the stability of coin value.

Calculating the Market Feedback Adjustment Factor ( M_t):

M_t=f(Circulation,Transaction Activity)

Where:

Circulation refers to the total amount of HC coins currently in circulation within the market.
Transaction Activity measures the volume and frequency of transactions involving HC coins.

The function f can be defined to reflect how changes in circulation and transaction activity impact the adjustment factor. For example, if circulation increases or transaction activity decreases, Mt may be adjusted downward to reflect potential downward pressure on coin value, and vice versa.

This adjustment helps maintain a balanced ecosystem, encouraging healthy trading practices and ensuring that the value of HC coins remains stable over time.

5.3.1.6 GV Value Conversion Logic

5.3.2 Staking Rewards

Staking rewards are distributed based on the amount of platform coins staked and the duration of the staking period.

5.3.2.1 Staking Reward Formula

The reward rate may be expressed as an annual percentage yield (APY) and needs to be adjusted based on the specific staking duration. The base interest rate is fixed at 10.00%. The minimum investment is 100.00 HC, and the lock-up period must be ≥ 1 year.

Total Staking Limit Formula:

Total Staking Limit=\frac{Total Allocation Pool}{Base Interest Rate}

Staking Reward Calculation:

Staking Reward=Staked Amount×Staking Duration×Interest Rate

Where:

Total Allocation Pool refers to the total amount of coins allocated for staking rewards.
Base Interest Rate is the fixed rate of 10.00%.
Staked Amount is the quantity of platform coins staked.
Staking Duration is the time period for which the coins are staked.
Interest Rate is the applicable rate for the staking period.

5.3.2.2 Staking Delegation and Commission

Any user holding HC can become a delegator and delegate their platform coins to validators. Validators can set their commission rate from staking rewards, ranging from 0% to 10%.

5.3.2.3 Staking Weight and Election

Leaders (validators responsible for creating new blocks) are selected in a rotating order based on the staking weight of platform coins at the beginning of each Epoch. The number of platform coins held by a validator determines the size of their voting power, known as staking weight. The greater the voting weight of a validator in the network, the higher the probability of being selected as a leader during the drawing process.

5.3.3 Reward Halving Mechanism

The first reward halving period is determined by scale, during which all transaction mining and staking rewards will be halved from their original calculated values. Subsequent halving time points will be dynamically adjusted based on network activity and demand.

5.3.4 Release Mechanism

The source of platform coins for transaction mining and staking rewards comes from the allocation pool. The platform transfers HC coins to the allocation pool according to an annual quota, and a portion of transaction fees will also flow back into the allocation pool. Other sources of platform coins, such as investors and teams, are directly allocated to the release pool.

5.3.4.1 Investor Release Mechanism

The platform coins allocated to investors will be released based on block height to ensure that investors' long-term interests are closely tied to the project's success. For an investment of 10million,withaminimuminvestmentof10,000 and a maximum subscription of 10 shares per person, the total platform coins for investors amount to 1 billion. The first release of platform coins will occur after reaching 100 Epoch cycles, releasing 100 million coins, followed by the release of platform coins in each subsequent Epoch cycle, completing the release over two years. The specific execution process is as follows:

Project Preparation

Develop a platform coin distribution plan and smart contract rules. Define the specifics of each Epoch cycle, such as block count or time length.

Investor Promotion

Introduce potential investors to the project details and the advantages of the platform coin distribution.

Subscription Intent Collection

Open channels for investors to express their subscription intentions, collecting and recording their subscription shares.

Fund Collection

Provide a secure wallet address for investors to transfer funds, setting a deadline for fund transfers.

Fund Verification

Confirm that the received funds match the subscription intentions.

Smart Contract Deployment

Develop smart contracts to automatically manage the distribution and release of platform coins, deploying the contracts on the blockchain.

Initial Distribution of Platform coins

Record investors' subscription shares in the smart contract.

First Release of Platform coins

Once the blockchain reaches the first Epoch cycle, the smart contract automatically releases 100 million platform coins to investors.

Subsequent Releases of Platform coins

At the end of each subsequent Epoch cycle, the smart contract releases platform coins according to the preset ratio.

Legal and Tax Consultation

Provide investors with relevant legal and tax advice.

Communication and Updates

Maintain communication with investors through email, forums, and other channels, regularly publishing project progress and updates on platform coin releases.

Project Milestones and Progress Tracking

Track and update key milestones and overall progress of the project.

Exit Mechanism and Liquidity Management

Plan and clarify liquidity solutions for platform coins and exit mechanisms for investors.

Risk Management

Identify potential risks and develop corresponding risk management strategies.

Documentation and Record Keeping

Document all transactions and processes to ensure transparency and traceability.

Audit and Compliance Checks

Conduct regular audits to ensure compliance with the platform coin distribution plan.

5.3.4.2 Team Release Mechanism

The platform tokens allocated to the team will be released according to a preset schedule to incentivize team members to commit to the long-term development of the project.

Quarterly Release Amount = \frac{Total Team Platform Tokens}{3×4}

The total platform tokens allocated to the team amount to 1 billion tokens, which will be released in equal quarterly installments over a period of 3 years. Each team member will receive their share based on the number of shares they purchased. The specific execution process is similar to section 5.3.4.1, with the following differences:

Internal Promotion: Introduce the platform token distribution plan to internal team members.
Subscription Intent Collection: Collect subscription intentions and shares from team members.
Fund Collection: Set a deadline for fund collection and provide a secure wallet address.
Fund Verification: Ensure that the received funds match the subscription intentions.
Reward Distribution: Distribute rewards quarterly to the wallet addresses registered by individuals.

5.3.4.3 Community Platform Token Release Mechanism

The platform tokens allocated to the community will be released through activities initiated by DAO voting to promote community participation and governance.

Release Process

Proposal Submission: Community members submit proposals for the use of community platform tokens.
Community Voting: Voting is conducted through the DAO platform to decide whether to execute the proposal.
Execution and Release: Once the proposal is approved, the proposal's content is executed, and the corresponding platform tokens are released.

Release Formula

The release of community platform tokens can be calculated using the following formula:

Released Tokens=Total Community Tokens×Approval Rate

Where:

Total Community Tokens refers to the total amount of platform tokens allocated for community use.
Approval Rate is the percentage of votes in favor of the proposal during the DAO voting process.

5.3.4.4 Airdrop Release Mechanism

1. Launch Testnet: Establish a testing environment that allows participants to experience platform token trading without involving actual funds. Develop and deploy the testnet, ensuring its stable operation.

2. Network-wide Promotion: Raise awareness and encourage more people to participate in the platform token airdrop activities. Create a promotional plan using social media, forums, email lists, and other channels.

3. Airdrop Token Reward Tasks: Incentivize users to participate in transaction mining by completing tasks to earn platform token rewards. Design a task mechanism that includes participation methods for both organization nodes and project nodes.

4. Participation of Organization Nodes and Project Nodes:

Organization Nodes: Increase user base and transaction volume through an invitation mechanism. Allow users to apply to become organization nodes and earn rewards based on the number of transactions and invited users transferred by the inviter.
Project Nodes: Increase the circulation and use of platform tokens through project contract transactions. Project parties engage in transactions via project contracts to participate in reward distribution based on the number of transactions.

5. Testing Phase: Ensure the system's stability and security during actual operation. Set a 45-day testing period during which users can claim test platform tokens from the public chain faucet.

6. Airdrop Weight Distribution: Fairly distribute airdrop rewards based on user activity and contributions. Determine each user's airdrop weight based on leaderboards and effective transaction activity.

7. Airdrop Distribution: Distribute airdrop rewards in phases to maintain user interest and participation. Divide the airdrop into three phases, releasing 1% of the platform tokens in each phase, with a 30-day interval between each phase.

5.3.4.5 Dynamic Adjustment of Release Mechanism

The release mechanism can be dynamically adjusted based on project development and market conditions to adapt to the changing environment.

Adjustment Logic

Monitor Project Progress and Market Feedback.
Community Proposals and Voting to Adjust the Release Plan.
Block Height (Transaction Volume).

Adjustment Formula

Adjusted Release Amount=Original Planned Release Amount×(1+Adjustment Factor)

Where:

Adjusted Release Amount: The new amount of tokens to be released after adjustments.
Original Planned Release Amount: The initial amount of tokens that was planned to be released.
Adjustment Factor: The factor used to calculate the changes in the release amount The adjustment factor can be determined based on the achievement of project milestones, market performance, or other relevant factors.

5.3.5 Transaction Fees

5.3.5.1 Fee Distribution

The specific distribution rules for transaction fees are as follows:

Allocated to the Distribution Pool for Settlement, Based on the Release Mechanism:

Staking Rewards: 30%
Transaction Mining: 20%

Allocated to the Release Pool for Settlement, Based on the Release Mechanism:

Investors: 10%
Community: 10%

Settled Immediately Upon Transaction Completion:

Validator Leaders: 30%

5.3.6 Node Rent

5.3.6.1 Concept of Rent

Each account on Huione is required to maintain a certain amount of HC platform tokens as rent to ensure that its data is available on the chain.

5.3.6.2 Rent Collection and Recovery

5.3.6.2.1 Rent Collection

The rent fees on Huione are dynamically calculated based on the state and load of the network. The minimum rent amount required for a specific size account can be calculated through Huione's GRPC nodes.When an account is created, a certain amount of storage space must be pre-allocated along with sufficient HC to pay for the rent. If the HC in the account falls below the amount required to maintain an active status, the account may be reclaimed by the network.Huione regularly collects rent to ensure that fees are collected from inactive accounts and to avoid load spikes caused by rent collection.

5.3.6.2.2 Rent Recovery

If the account owner no longer wishes to keep data on the chain, they can close the account and recover the rent deposit by transferring the entire HC balance of the account to another account.

5.3.6.3 Rent Incentive Mechanism

The rent mechanism encourages users and developers to use network resources judiciously, avoiding the creation of numerous useless accounts or the storage of excessive unnecessary data, thereby maintaining the healthy development of the network.

6. Roadmap and Development Plan

6.1 Roadmap

This white paper outlines the short-term, medium-term, and long-term goals for Huione and the HC platform token. Due to influences from market, economic, and policy factors, future plans will be adjusted based on actual circumstances.

Short-term Goals (1-2 years)

Launch incentive mechanisms such as transaction mining to encourage developers to build applications on the Huione public chain.
Establish a community governance structure to implement a democratic process for key decision-making.
Strengthen network security and implement technical upgrades to defend against cyber attacks.

Medium-term Goals (3-5 years)

Explore collaborations with other public chains to achieve cross-chain asset and information flow.
Address global regulatory policies to ensure legal and compliant operations, establishing partnerships with global collaborators.
Conduct blockchain knowledge dissemination and educational activities.

Long-term Goals (5 years and beyond)

Integrate sustainable development concepts and support green finance projects.
Build a mature blockchain ecosystem to attract more users and capital participation.
Continuously promote technological innovation to maintain industry leadership.

6.2 Development Plan

1、Technological Innovation and Upgrades

Huione's development will focus on continuous technological innovation and upgrades to meet the growing user demands and industry trends. We will commit to the following areas:

Network Performance Optimization: Continuously improve consensus algorithms and network protocols to enhance transaction processing speed and network throughput, ensuring efficient and stable operation of Huione globally.
Smart Contract Expansion: Enhance the functionality and security of smart contracts to support more complex application scenarios, especially in areas such as DeFi, NFTs, and the metaverse.
Privacy Protection Technologies: Develop and integrate advanced privacy protection technologies, such as zero-knowledge proofs and homomorphic encryption, to enhance the privacy and security of user transactions and assets.

2、Ecosystem Expansion

Huione's development goal is to build a diverse and sustainable blockchain ecosystem through the following means:

Cross-Chain Interoperability: Promote cross-chain cooperation with other mainstream public chains to facilitate the flow of assets and information, expanding Huione's application scenarios and user base.
DApp Development and Support: Provide developer-friendly tools and environments to support the construction and deployment of more decentralized applications (DApps) on Huione, fostering the emergence of innovative applications.
Community Incentive Programs: Attract more developers and users to participate in ecosystem construction through the incentive mechanisms of HC platform tokens, promoting the prosperous development of the community.

3、Security and Compliance

Throughout the development process, Huione will prioritize security and compliance to ensure the safety of user assets and the legal operation of the public chain.

Security Technology Upgrades: Continuously monitor the network security landscape, promptly fix potential security vulnerabilities, and enhance network protection through regular security audits and testing.
Global Compliance Strategy: Actively collaborate with regulatory agencies worldwide, adhering to local laws and regulations to ensure Huione's legal and compliant operation globally.

4、Global Strategy and Market Expansion

To enhance Huione's global influence, we will implement the following globalization strategies:

International Market Expansion: Expand Huione's application areas and market coverage through partnerships with globally renowned companies and blockchain projects, increasing its influence in the global market.
Brand Building and Promotion: Strengthen brand building and market promotion to enhance Huione's recognition and reputation in the global blockchain industry.

5. Community Governance and Democratic Decision-Making

Huione will achieve true democratic decision-making through a decentralized community governance structure:

Decentralized Governance: Community members can participate in significant decisions of Huione, such as protocol upgrades and fund allocations, through the voting rights of HC platform token holders, ensuring that the development direction of the public chain aligns with the common interests of the community.
Transparency and Participation: All governance processes will be open and transparent, allowing all community members to participate in discussions and decision-making, promoting Huione's development towards a more democratic and open direction.

6、Sustainable Development and Environmental Responsibility

While pursuing technological advancement and economic benefits, Huione will also focus on sustainable development and environmental protection:

Green Blockchain Technology: Explore and adopt low-energy, high-efficiency blockchain technologies to reduce energy consumption and minimize environmental impact.
Social Responsibility Projects: Support and participate in various green finance projects and social responsibility activities, demonstrating Huione's commitment to sustainable development.

7、Education and Talent Development

Huione will also commit to the popularization of blockchain technology and talent development to promote the long-term growth of the entire industry:

Blockchain Education Programs: Enhance public understanding and awareness of blockchain technology through online courses, seminars, and training programs.
Developer Support Programs: Provide resources and support for developers, encouraging them to develop innovative applications on Huione, promoting the mutual advancement of technology and the ecosystem.

7. Community Governance and KPI

7.1 Community Governance Mechanism

The Huione community governance mechanism ensures the democratization and transparency of the project:

Governance Structure: Clearly defines the hierarchy and roles in governance, including proposers, voters, and executors.
Proposal Mechanism: Allows community members to submit proposals regarding platform development, parameter adjustments, and other aspects.
Voting Mechanism: Utilizes weighted voting based on platform token holdings to ensure fairness and representativeness in voting.
Incentive Mechanism: Validators are incentivized by rewards and penalties based on their behavior in the network. If validators engage in misconduct, such as participating in malicious activities, their staked platform tokens will be penalized, resulting in losses not only for the validators themselves but also affecting the holders who delegated their tokens to them.

7.2 KPI Indicator System

The KPI indicator system of the Huione platform is key to measuring project success:

User Activity: Measured by Daily Active Users (DAU) and Monthly Active Users (MAU).
Network Transaction Volume: Total number of transactions and total transaction value, reflecting the transaction activity of the network.
Platform Token Circulation Speed: The turnover rate and circulation speed of platform tokens, measuring the liquidity of the tokens.
Network Stability: Includes indicators such as network uptime and transaction failure rate.

7.3 Community Incentive Program

The community incentive program aims to encourage active participation from community members:

Contribution Rewards: Platform token rewards based on the level of contribution from community members, such as code submissions, documentation writing, and community support.
Community Activity Fund: Establish a fund to support online and offline activities organized by community members, enhancing community cohesion and influence.
Feedback Reward Mechanism: Encourage users to provide valuable feedback and suggestions, rewarding platform tokens for adopted suggestions.

7.4 Community Education and Support

Educational Resources: Provide a wealth of educational resources, including technical documentation, tutorials, FAQs, etc., to help users understand and utilize the HC platform token platform.
Technical Support: Establish a technical support team to provide timely and effective technical assistance and consulting services to users.

7.5 Community Governance DAO

Key steps in DAO governance:

Staking for Governance Tokens: Community members can stake HC platform tokens to obtain governance tokens, typically to participate in the DAO decision-making process.
Proposal Submission: Members holding a certain number of governance tokens (e.g., 1 million holders) can submit proposals. Proposals may involve platform development, fund usage, community rules, etc.
Community Discussion: After proposal submission, it enters the community discussion phase, where all members can express their opinions on forums or other social platforms.
Voting Rights Linked to Staking Amount: According to DAO rules, a user's voting rights may be linked to the amount of platform tokens they have staked, ensuring that the support for proposals is proportional to member participation.
DAO Voting Mechanism: Community members use governance tokens to vote on proposals. The DAO may adopt different voting mechanisms, such as one token one vote, quadratic voting, or liquid democracy.
Proposal Approval Standards: Proposals need to receive a certain percentage of approval votes and meet quorum requirements to pass. These standards are clearly defined in the DAO governance rules.
Execution and Monitoring: Once a proposal is approved, smart contracts or other mechanisms will automatically execute the proposal's content. The community will continuously monitor the effectiveness of the proposal's execution.
Liquidity Rewards: Members staking platform tokens will earn liquidity mining rewards while participating in governance.
Proposal Closure and Token Redemption: After a proposal concludes, members can choose to redeem governance tokens for HC platform tokens.
Platform Benefits and Status Symbol: Members participating in proposals and voting may receive additional platform benefits based on the size of their voting amounts.
Continuous Iteration and Improvement: Based on community feedback and governance effectiveness, the DAO governance model and processes may continuously iterate and optimize to better adapt to changes in the community and market.

8. Risk Management Measures

During the development and operation of Huione, the project may face various risks. The following content provides a comprehensive analysis of these risks to help investors and users fully understand the challenges involved.

8.1 Technical Risks

Technical risk is a key issue faced by Huione. Although the technical framework of the Huione blockchain possesses high transaction processing capabilities and security, potential challenges may still arise during technical implementation:

Technical Vulnerabilities: The complexity of blockchain technology may harbor undiscovered vulnerabilities that could be exploited maliciously, leading to security risks. To mitigate this risk, Huione will conduct regular code audits and establish a robust security response mechanism.
Smart Contract Risks: Once deployed, smart contracts cannot be altered. If there are programming errors or logical flaws in the smart contracts, it may result in irreversible losses. To address this, Huione will implement multi-layered testing and validation processes to ensure the security and reliability of smart contracts.
Technology Updates and Compatibility: As blockchain technology continues to evolve, Huione needs to update continuously to maintain competitiveness. However, the introduction of new technologies may lead to incompatibility with existing systems, increasing implementation difficulty and risk. Huione will ensure a smooth transition through phased technology upgrades and extensive community testing.

8.2 Market Risks

Market risk is another critical factor affecting Huione's development, primarily reflected in the following aspects:

Market Competition: The blockchain field is highly competitive, with several mature public chain projects already in the market. Huione may face challenges in attracting users and developers. To address this risk, Huione will continuously promote technological innovation and ecosystem development to enhance platform competitiveness.
Market Demand Fluctuations: The cryptocurrency and blockchain market is highly volatile, with user demand and market trends potentially changing rapidly, affecting Huione's development and promotional strategies. Huione will adopt flexible market strategies and quick response mechanisms to adjust project direction in a timely manner to adapt to market changes.
Economic Fluctuations: Global economic uncertainty may impact investor confidence in the cryptocurrency market, subsequently affecting Huione's market performance. Huione will enhance investor trust through transparent operations and a robust economic model.

8.3 Legal Risks

As countries increase their regulatory efforts on cryptocurrencies, legal risks have become an important factor that blockchain projects cannot ignore:

Legal Uncertainty: Different jurisdictions have varying and uncertain regulatory policies regarding cryptocurrencies and blockchain technology, which may lead to restrictions or forced cessation of Huione's operations in certain regions. To address this risk, Huione will work closely with legal experts to ensure compliance in global operations.
Regulatory Changes: The global regulatory environment may change rapidly, potentially affecting Huione's operations and development. For example, certain regions may introduce stricter anti-money laundering and counter-terrorism financing regulations, increasing compliance costs for the project. Huione will continuously monitor global regulatory dynamics and adjust compliance strategies in a timely manner.

8.4 Operational Risks

Operational risks encompass potential challenges in Huione's daily management and ecosystem development:

Management Team Risk: The success of the project relies on the capabilities and experience of the management team. If the management team makes poor decisions or experiences member turnover, it may negatively impact project operations. To mitigate this risk, Huione will establish a transparent and efficient management mechanism and attract and retain outstanding team members.
Ecosystem Risk: Huione's success depends on the healthy development of its ecosystem. If partners, developers, and users lose confidence in the ecosystem, it may affect the platform's activity and sustainability. Huione will maintain ecosystem vitality through active community building and user incentives.
Technical Support and Maintenance: As Huione's user base expands, the demand for technical support and maintenance will increase. If technical issues are not resolved promptly, it may affect user experience and the platform's reputation. Huione will ensure stable operation of the platform by establishing a robust technical support team and comprehensive maintenance processes.

9. Appendix

9.1 Glossary

The following are some key terms and definitions used in the Huione white paper:

TPS (Transactions Per Second): The number of transactions per second, an important metric for measuring blockchain processing capacity.

Consensus Mechanism: The algorithm used in a blockchain network to reach consensus, ensuring all nodes agree on the state of the blockchain. Examples include PoS, PoW, etc.

CAP (Brewer's Theorem): A fundamental concept in distributed computing that states that a distributed system can only simultaneously satisfy two of the three guarantees: partition tolerance, consistency, and availability.

PoS (Proof of Stake): A consensus mechanism in blockchain that selects validators based on the stake of tokens held.

PoH (Proof of History): A cryptographic mechanism used to generate an immutable time sequence.

TPU (Transaction Processing Unit): The core logical component used by validators for block production, responsible for processing incoming transactions in the network and packaging them into new blocks through a series of steps.

Turbine: An efficient block propagation mechanism designed to optimize data transmission in distributed networks, quickly and efficiently spreading transaction data (shards) to all nodes in the network through a hierarchical approach. Its design aims to reduce bandwidth requirements, shorten latency, and minimize network congestion or attacks from malicious nodes.

FEC (Forward Error Correction): An error correction technique used in data transmission. It adds redundant information to the data, allowing the receiver to detect and correct errors in the data transmission without needing to request a resend.

TVU (Transaction Validation Unit): Responsible for validating transactions to ensure they meet the requirements of the consensus protocol.

Pipelining: An optimization technique widely used in computer systems and hardware design to improve task processing efficiency. It breaks down a complex task into multiple smaller, independent stages, each dedicated to a specific task, allowing multiple tasks to be processed simultaneously at different stages, thereby increasing overall throughput.

PoRep (Proof of Replication): A blockchain mechanism that ensures data is stored correctly.

DApp (Decentralized Application): An application that runs on a blockchain and is not controlled by a single entity.

DAO (Decentralized Autonomous Organization): An organizational form that achieves self-governance through smart contracts.

Epoch: A time period used to describe the settlement phase in mechanisms such as transaction mining.

HC (Huione Coin): The platform token of the Huione public chain, used for incentives and governance.

Gas: The fee required to execute operations or smart contracts on the blockchain.

Smart Contract: An automatically executed contract where the terms of the agreement between buyer and seller are directly written into lines of code.