What Is Boba Network (BOBA)?

Boba Network (BOBA), a layer 2 Ethereum scaling and augmenting solution, promotes smart contract capabilities, lowers fees of gas, as well as improves transactions. Keep on reading to get more insights on the Boba Network, its working mechanism, and what users are to expect from the BOBA token.

Boba Network: An Optimistic Approach to Ethereum Scaling

Formerly OMGX, the Boba Network is an Ethereum scaling solution with its mainnet beta version launched in August 2021. The aim of the Boba Network is to increase throughput, reduce the fees of transaction and computation, and enhance smart contract capabilities on the Ethereum network.

Boba uses Optimistic Rollups (ORs) to achieve this aim. Optimistic Rollups (ORs) is a Layer-2 scaling solution that assumes that unless challenged, transactions are valid. The transactions, if challenged, can be checked and thereafter verified through the use of computation.

Boba Network gets support from OMG Foundation (formerly known as the OMG Network and OmiseGo) and blockchain and artificial intelligence infrastructure company Enya. The latter is a blockchain infrastructure company serving as a major contributor to OMG, one of Ethereum’s earliest Layer-2 solutions.

BOBA was developed by Enya and the OMG foundation to provide a scalable platform for the development of applications that is completely compatible with the Ethereum network and can help developers to create at a quick pace, powerful and multifaceted problems.

The BOBA token is used by Boba Network to enhance governance and promote network growth, as well as user adoption in the ecosystem of decentralized finance (DeFi). Other areas of Boba Network applications are its use by non-fungible token (NFT) projects and powering applications that are Web3-enabled.

Origin of Boba

Alan Chiu and Jan Liphardt met at Stanford University in 2018 and founded Enya. Prior to the founding of Enya, Chiu was a partner at XSeed Capital, where he basically built and invested in enterprise technology startups. Meanwhile, Liphardt spent the most part of his career as a professor, which featured teaching at StartX Accelerator, where he assisted startup companies in the areas of hardware and analytics.

The testnet launched in May 2021, under the name OMGX, but was rebranded later to Boba Network owing to a joint effort of research and development between Enya and the OMG foundation. The OMG foundation is a non-profit organization that is committed to the expansion of the Ethereum ecosystem via its ongoing support of Boba Network and the OMG Plasma Network.

The official launch of the Boba Network mainnnet took place in September 2021, with the aim of increasing throughput, reducing the fees of transaction and computation, and improving smart contract capabilities on the Ethereum network.

Key Features of Boba Network

Key features and principles of work of Boba Network are discussed below:

• Cheap cost of transaction. Boba provides a solution to the high gas fee charged by Ethereum which cost an average of $10-$50 per transaction. Boba Network reduces the per unit transaction costs to much lower levels, compared to those on the main network of Ethereum. Every 30 seconds there is a change in the gas price of L2 which is typically around 10 Gwei.
• NFT bridging. Boba Network enables users the space to mint, move and sell their NFT assets both between L1 and L2 and between different L2 solutions. This has created more ease and convenience in the development of NFTs, especially GameFi which combines three major markets: non-fungible tokens(NFTs), decentralized finance (DeFi), and blockchain-based games.
• Fast exit. Users of Boba Network can much more quickly transfer their money both in and out of the network within a few minutes in comparison with conventional Layer 2 solutions. Boba Network reduces the Optimistic Rollup exit time to a few minutes by offering quick exits supported by liquidity pools that are driven by the community. This feature also gives incentivized yield farming opportunities to liquidity providers (LPs). As a result, users can utilize yield farming to earn interest in their digital assets.
• Ease of hybrid computation. Boba Network makes possible the implementation of sophisticated algorithms that are practically impossible to perform on-chain, by enabling Ethereum developers to execute codes on web-scale infrastructure, which is similar to AWS Lambda, a computing platform provided by Amazon.
• Secured by Ethereum. Boba Network works with the security of Ethereum because it is a Layer-2 protocol on Ethereum that leverages Optimistic rollup technology.
• Smart contracts scalability. Boba helps Ethereum developers to use algorithms to build DApps without incurring much cost. The network allows developers to plug executed code into algorithms on web-extensive infrastructure.

BOBA Token

Boba Network’s Ethereum-based ERC-20 staking and governance token is BOBA.

In the beginning, 500 million BOBA were pre-mined and allocated to some parties, of which around 150 million BOBA went into circulation. The initial distribution was basically the end product of the airdrop (140 million BOBA) that allowed the OMG token holders at the time of the snapshot in November 2021 to claim BOBA on a 1:1 basis.

BOBA functions mainly as the governance token for Boba Network DAO, which is responsible for decisions on community initiatives and the network’s future. To participate in governance, holders of the token stake BOBA in exchange for xBOBA and receive a vote. BOBA rewards are also distributed to stakers from the Boba treasury. When the Boba Network fees become stable, stakers are paid a portion of each transaction fee earned by the network, and the emissions from the treasury.

The BOBA tokens from the treasury are further used for network growth incentivization. These tokens are also used to fund a variety of initiatives, including liquidity mining rewards, a bug bounty program, and bridging incentives.

Pros and Cons of Boba Network

Like any blockchain solution, Boba comes with both positives and odds.

Boba Network provides users with quick or fast-paced execution at low costs of transactions, enabling them to benefit from the security and decentralization of Ethereum. The network allows a cost-effective launch and bridging of NFTs to Ethereum, as well as quick exits backed by liquidity pools that are community-driven and a Boba NFT Bridge.

As for the drawbacks, it is difficult to ascertain Boba’s true value. While the coin has solid fundamentals, it’s likely over the short term to lose some of its value.

Conclusion

Optimistic rollups like Boba Network are currently at the forefront of dominance in user adoption and activity. It is, however, vital to observe that ZK rollups are still undergoing working progress. When they become fully functional, there’s a likelihood they will capture a substantial portion of the Layer-2 market from Optimistic rollups.