GB Market Commentary 08/12/2021
by Marcus Sotiriou
Today’s cryptoinsight will include a deep dive into Theta network – a decentralised video delivery network, aiming to provide high quality video streams without the buffering issues often seen today.
What is Theta?
Theta is a blockchain based video-streaming platform, that enables high bandwidth content delivery.
The global video streaming market is booming – currently a $50+ billion industry projected to grow by 20% a year over the next decade.
Demand for high quality streams is growing along with the percentage of users experiencing streaming issues.
Incumbent centralised systems become inefficient with advancements in technology.
The leader in the decentralised video streaming space is Theta, which has a solution to deliver content in a smooth fashion whilst paying you for supporting the network.
How does it work?
All quality streams need a certain level of bandwidth to operate smoothly with little buffering.
If your TV or computer is turned off, its bandwidth is not being used
People who use Theta can lease out unused bandwidth (when watching streams on THETA.tv, an app built on the Theta network, or even when asleep).
By acquiring unused bandwidth, you get improved stream quality and loading times – this decreases latency and lag.
In return for leasing out unused bandwidth people will be rewarded with TFUEL tokens (expanded on later).
If Theta continues its adoption growth, you will be able to have your internet bills paid for with these TFUEL tokens.
You can use TFUEL tokens to send donations to streamers, unlock premium. content and buy and gift virtual items.
How does this benefit streaming companies?
Technology is growing at an outstanding pace
Theta platform becomes more prevalent as streaming services struggle with providing the necessary bandwidth to keep up with new technology like 4k, 8k and VR (virtual reality) streaming.
By using the Theta platform content providers can save money by reducing their overall bandwidth costs and creating a more efficient delivery system.
How is the network secured?
The network is secured by a Proof-of-Stake consensus mechanism.
This is less demanding than Proof-of-Work consensus (Same as Bitcoin) and higher transactions/sec.
The Theta blockchain is incredibly efficient - average transaction time is 3 seconds, and it can handle over 1,000 transactions per second.
Validator nodes - run by enterprises e.g. Google run an enterprise validator node
These validate new blocks entering the chain.
Requires holding a certain amount of THETA tokens.
Theta aims to have 31 external enterprise validators.
Guardian node – run by the community, requiring 1,000 THETA tokens.
Ensures the validator node acting honestly
Second line of defence
There are thousands of guardians.
Having a second layer of guardians in place means that compromising the theta network becomes much more difficult for hackers.
In the unlikely event that all validators are controlled by a group of hackers, guardians re-elect their validators and reset the blockchain from the most recent uncompromised block.
This achieves decentralisation, high throughput and security for its users.
Smart Contracts Platform – Can Theta integrate DeFi?
Theta’s mainnet allows for smart contracts to be supported on the blockchain, meaning it can integrate DeFi applications.
Therefore, Theta can compete with Ethereum in attracting developers to build on the Theta blockchain.
Projects built on Ethereum can be converted to the Theta network via a cross-chain bridge, which is appealing due to the high fees on the Ethereum blockchain.
Voltswap decentralised exchange has launched on Theta recently.
If Theta can successfully attract developers to build on the Theta blockchain, that adds another significant dimension to Theta’s value proposition.
Thetadrop – NFT marketplace
Thetadrop launched this Summer, with many NFT collections being sold including NFTs associated with famous influencers, like BitBoy Crypto.
Recently, Secret Pineapples NFT launched which has been the most successful launch on Thetadrop, with the highest sell being $58,000.
Katy Perry will release her NFT on the Theta blockchain this month.
She said, “My fans can own a special moment of my residency (series of concerts) that’s both a digital collectible as well as an IRL experience,” based around the celebration of her Las Vegas concert tour.
With Theta’s CAA partnership (more on this below), I am optimistic on Thetadrop becoming a major NFT marketplace in the long term.
Samsung – May 2019
Samsung has a 50% market share of all smart TVs.
May 2020 - Theta launched its Android app for smart TVs.
Plans announced for Theta to be integrated into these smart TVs.
Smart TV owners would be able to lease out their own bandwidth and get paid in TFUEL, having their internet bills paid for.
Samsung announced plans to integrate THETA.tv (a streaming platform on the Theta network) into all Galaxy smartphones – 75 million devices worldwide.
Binance – Jan 2020
Google – May 2020
Google bought 5 million Theta tokens
Allows Theta to meet a growing active user base by allowing people to run Theta nodes on Google Cloud’s Marketplace (worldwide).
Google Cloud powers the cloud infrastructure underpinning the Theta.tv video platform – Theta can use Googles database and analytics products.
Sony – March 2021
CAA (creative artists agency) – May 2021
World’s leading talents and sport artists.
Katy Perry is a client hence the involvement with Thetadrop
I think many of their thousands of clients may use Thetadrop to launch NFTs.
Partnered with Koreas’ largest media and entertainment networks - Pandora tv (also has a major presence in Japan), MBN and CJ Hello.
Partnered with NASA and SpaceX – Theta has become one of only 4 video services with direct access to NASA’s source video feed.
Theta have filmed multiple SpaceX launches on THETA.tv.
Virtual Reality (& the Metaverse)
VR (Virtual Reality) will be huge.
Currently valued around 15 billion USD currently. Expected to grow to 90 billion USD by 2025 with a compound annual growth rate of 50%.
Bandwidth is what is keeping VR down from operating globally, as it takes up so much bandwidth to use VR.
Theta will make VR usable for people connecting with others all around the world, not just locally.
Samsung VR could be huge - Theta network is already integrated into Samsung.
Theta’s technology allows it to form the key infrastructure to power metaverses, with the Theta video API acting as the building block.
In September, Decentral Games (gaming metaverse) partnered with Theta Network to Scale Livestream Capacity.
The founder said, “We are confident that Theta’s industry leading solution in decentralized video content delivery will bring fans closer to the action in the highest quality viewing experience available. Theta has proven themselves as the best solution for our needs and we can’t wait to reveal more exciting developments in the works from our multi-phase rollout with Theta.”
As VR is incorporated into metaverses there will be a bigger need for Theta’s technology stack.
1. Large media companies have been sitting on the side-lines due to concerns that they will not be able to properly manage copyright on a decentralised platform.
If this problem is solved, then media giants will be much more likely to incorporate the power of theta’s decentralised network.
Theta already has 7 patents, which are being used as a protective measure for certain innovations to establish a claim on ideas before they are claimed by someone else.
Therefore, large corporations cannot copy the framework to use on their own platforms.
2. Attracting developers to migrate over from Ethereum and build on the Theta blockchain.
Cofounder / CEO - Mitch Liu
Cofounder of Tapjoy – mobile advertising and app monetisation company.
Steve Chen – co-founder of Youtube.
Justin Kan – co-founder of Twitch.
Kyle Okamoto – Chief Network Officer of Verizon Digital Media Services
Jonathan Wong – ex head of consumer apps and services marketing at Microsoft.
What is THETA Token used for?
1. Staking – by running a node users earn a proportional amount of newly generated TFUEL tokens.
2. Security – by running validator/guardian nodes you can validate new blocks, helping the network stay secure.
3. Governance – running a node gives you voting rights on the direction of the protocol.
There is a circulating supply of 1 billion THETA tokens which will never increase – it has reached its max supply.
What is TFUEL token used for?
TFUEL is used as a gas fee to operate on the network.
TFUEL is inflationary but TFUEL gets burned for every transaction.
The Theta team suggest that it may not be inflationary in the future as the network receives more adoption and more TFUEL is burned daily.
Price Action: THETA - $4.57, Market Cap - $4.57 billion
Since the market crash in May, THETA has underperformed the rest of the market.
However, Theta network’s metaverse narrative could mean that it gains traction again soon.
In addition, Katy Perry’s NFT release could bring further attention to the project.
If the breakout above the descending trend line shown above holds, we can expect upside in the coming weeks – it is important to note that most alts are especially dictated by Bitcoin’s price action in volatile periods like now.
You can trade THETA at GlobalBlock. To set up an account visit our website: https://www.globalblock.co.uk/
If you have already set up an account, get in touch with one of our traders: +44 203 307 3780.