Quai Network Unveiled: Why Can This New Public Chain Attract Institutional Investment?

Bottlenecks of Traditional Blockchains and Quai’s Breakthrough

Current mainstream blockchain projects generally face an awkward dilemma—speed and security are hard to achieve simultaneously. As a Layer-1 platform, Quai Network ambitiously aims to solve both of these issues, and even further envisions building a new cryptocurrency system.

Interestingly, this highly关注ed project originally stemmed from a hardware wallet idea. Throughout its growth, Quai has gradually evolved into a blockchain infrastructure recognized by heavyweight capital. This article will delve into the core mechanisms, innovative designs of this new public chain, and why it has gained favor among institutions.

What is Quai? What Are the Core Differences?

The uniqueness of Quai Network lies in its multi-chain parallel architecture. Imagine if traditional blockchains are single-lane highways, then Quai is like a multi-lane, three-dimensional traffic network—multiple independent blockchains can run simultaneously, each handling transactions, yet interconnected. This design boosts the network’s throughput to 50,000 transactions per second.

Additionally, Quai adopts a consensus mechanism called “Minimal Entropy Proof” (PoEM), which retains PoW security while significantly increasing confirmation speed.

In terms of token design, Quai breaks the conventional single-token model, creating two distinct assets:

Quai Token — the main fuel of the network

• Used for paying transaction fees, executing smart contracts, participating in governance
• Price determined by market supply and demand
• Features a deflationary model, similar to Bitcoin’s scarcity design

Qi Stablecoin — energy-anchored medium of exchange

• Value directly linked to energy costs (not fiat currency)
• Equipped with cash-level privacy features
• More suitable for daily settlements and DeFi applications

This dual-token system enables Quai Network to possess the three major currency attributes: “store of value, accounting unit, and medium of exchange.”

Development Trajectory: From Academic Research to Mainnet Launch

Quai’s story began in 2018. Karl Kreder, working at GridPlus, proposed a theoretical study on protecting PoW hierarchy through merged mining. This research received funding from the U.S. National Science Foundation and was later brought to the University of Texas at Austin.

There, Kreder teamed up with Electrical and Computer Engineering professors Sriram Vishwanathan and Alan Orwick. They quickly advanced the project:

• Stone Age Testnet: initial proof of concept
• Bronze Age Testnet: a real milestone, generating over 1.5 million blocks, completing 100,000 transactions, attracting 1,700 nodes worldwide
• Golden Age Testnet: further optimization and stabilization

Capital began to pay attention. In 2022, Polychain Capital invested $8 million, and Alumni Ventures added another $2 million. By 2024, the team secured an additional $5 million strategic funding, laying the foundation for mainnet launch.

In-Depth Technical Architecture Analysis

Multi-Chain Execution Sharding

Quai’s multi-chain structure is not just simple parallel copies but interconnected execution shards. Each chain independently verifies transactions, but the state of all chains is cryptographically linked, ensuring overall security while avoiding single points of failure.

Merged Mining Innovation

In traditional PoW, miners invest work on a single chain. Quai’s innovation allows miners to perform proof-of-work calculations on multiple chains simultaneously without additional hardware investment. This is equivalent to earning multiple rewards with the same computing power, greatly improving mining efficiency.

PoEM Consensus Mechanism

The core of “Minimal Entropy Proof” is to limit the randomness in block producer selection, preventing excessive centralization of hash power, and accelerating transaction confirmation. It maintains PoW fairness and resistance to censorship while achieving speeds close to PoS.

Eight Core Competitiveness

1. Ultra-high throughput
Processing capacity of 50,000 transactions per second, leading in Layer-1.

2. Inclusive mining mechanism
Through Workshares, small-scale miners can participate, lowering hardware barriers and energy consumption.

3. Fully compatible with EVM
Ethereum applications can seamlessly migrate to Quai, minimizing developer learning curve and ecosystem migration costs.

4. Dual-token economic model
The division of roles between Quai and Qi allows for investment, transaction, and governance functions.

5. Adaptive scalability
As user base grows, the network automatically adjusts load distribution, maintaining high efficiency.

6. Double-spending prevention design
PoEM effectively prevents common attacks like double payments.

7. Decentralized governance
Anyone can participate in node operation and mining, with no central control.

8. Developer ecosystem
Complete toolchains, documentation support, and incentive plans foster an active builder community.

Token Economics Framework

Quai adopts a total supply cap similar to Bitcoin—limiting the maximum issuance to ensure scarcity. Tokens are allocated to early contributors of the testnet (miners, validators, developers), with some reserved for ecosystem incentives, foundation operations, and strategic reserves.

The Quai token supports core network functions—transaction fees, smart contract execution, DAO governance. A burning mechanism (automatic token burn during certain user operations) further enhances scarcity.

Qi focuses on stable, liquid trading scenarios, with its design linked to energy prices, providing relative stability across cycles. The combination of both forms a relatively complete decentralized financial system.

Outlook: Three Key Observation Indicators

The potential of Quai Network is real, but to truly become an industry leader, close attention should be paid to these three points:

1. Developer and user community expansion — ecosystem activity directly determines network value

2. Market competitive position — ability to stand out among numerous Layer-1 projects

3. Long-term stability verification — stability and security record of mainnet operation

Once these three aspects achieve significant results, Quai has the potential to become the infrastructure of the next generation.

Overall Evaluation

Quai Network represents a new approach in blockchain technology—solving scalability issues through multi-chain parallelism rather than single-chain optimization, and balancing speed and security with PoEM consensus rather than abandoning PoW entirely.

Its three core advantages include:

• Technological innovation: multi-chain architecture supporting 50,000 transactions per second
• Economic design: dual-token system meeting storage, settlement, and circulation needs
• Eco-friendliness: EVM compatibility minimizes application and developer migration costs

From an academic concept in 2018 to the mainnet now officially launched, the evolution trajectory of Quai Network is worth watching. It aims not only to address current blockchain bottlenecks but also aspires to create a new decentralized global currency system. Whether this goal can be achieved, time and market will ultimately tell.