Citi Files Patent for Double-Layer Subnet on Avalanche: What It Means for AVAX
Citi, one of the world’s largest financial institutions, has filed a new patent detailing a system designed to facilitate a double-layer restriction subnet architecture. This development builds on the bank’s ongoing work on the Avalanche blockchain, signaling a significant advancement in blockchain technology. The patent could have implications for AVAX, which has been consolidating below a key resistance level of $28, indicating a potential bullish breakout.
Key Details of Citi’s Patent
The new patent, filed with the USPTO, describes a system that aims to overcome the limitations of traditional blockchains and their subnets. Citi’s proposed system is built on a double-layer architecture composed of:
- A series of permissioned subnets
- Enhanced security and privacy features
- Scalability improvements using subnet efficiency
The system addresses key challenges such as unauthorized access to digital communications, which blockchain encryption attempts to mitigate. However, Citi notes that integrating blockchain technology remains complex, especially given that smart contracts cannot be amended if conditions change, leaving them vulnerable to malicious attacks.
Challenges of Traditional Blockchain Technology
Citi’s patent filing highlights several challenges that traditional blockchain technology faces:
- Inability to modify smart contract instructions after they are issued
- Public visibility of information posted to the blockchain, leading to privacy concerns
- Security issues in centralized software infrastructures
The bank points out that using permissioned blockchains could address some of these challenges, but they come with drawbacks like centralized attack targets and reduced decentralization.
The Role of Subnets in Blockchain
Public blockchains can benefit from subnets, which are secondary networks built on top of the Layer 1 chain for specific use cases. Avalanche has popularized the use of subnets, with each subnet operating as a “sovereign network” that defines its own rules for membership and token economics.
However, Citi acknowledges that subnets are not without flaws. If the underlying network suffers from security or scalability issues, the subnets inherit those problems, putting users at risk. To solve this, Citi proposes a double-layer restriction subnet architecture that combines permissioned subnets with scalability and privacy improvements.
Citi’s Double-Layer Subnet Architecture
According to Citi, the double-layer restriction subnet architecture offers the following benefits:
- Enhanced security and privacy through permissioned subnets
- Scalability advantages using subnet efficiency
- Overcoming challenges with unauthorized access and public data visibility
This new patent builds on Citi’s earlier work with Avalanche, particularly its test of tokenizing private equity funds on the Spruce Subnet. The bank partnered with Wellington Management and WisdomTree for this project, further demonstrating its commitment to innovation in blockchain technology.
AVAX Price Outlook
At the time of writing, AVAX is trading at $27.59, showing a slight dip for the day but maintaining a 12% rally over the past week. The token is consolidating just below the $28 resistance level, which analysts believe could signal an impending bullish breakout.
Ecosystem
Research
News Network
About