NSF Org:	TI Translational Impacts
Recipient:	KRNC INC.
Initial Amendment Date:	May 15, 2020
Latest Amendment Date:	May 15, 2020
Award Number:	2015162
Award Instrument:	Standard Grant
Program Manager:	Anna Brady-Estevez TI  Translational Impacts TIP  Directorate for Technology, Innovation, and Partnerships
Start Date:	May 15, 2020
End Date:	October 31, 2021 (Estimated)
Total Intended Award Amount:	$225,000.00
Total Awarded Amount to Date:	$225,000.00
Funds Obligated to Date:	FY 2020 = $225,000.00
History of Investigator:	Clinton Ehrlich-Quinn (Principal Investigator) clint@krnc.io
Recipient Sponsored Research Office:	KRNC INC. 1738 BRIDGEPORT AVE CLAREMONT CA  US  91711-2518 (909)576-1343
Sponsor Congressional District:	28
Primary Place of Performance:	Krnc Inc. 1738 Bridgeport Ave Claremont CA  US  91711-2518
Primary Place of Performance Congressional District:	28
Unique Entity Identifier (UEI):	RESRDEJQJ3H5
Parent UEI:
NSF Program(s):	SBIR Phase I
Primary Program Source:	01002021DB NSF RESEARCH & RELATED ACTIVIT
Program Reference Code(s):	8032
Program Element Code(s):	537100
Award Agency Code:	4900
Fund Agency Code:	4900
Assistance Listing Number(s):	47.084

ABSTRACT

The broader impact/commercial potential of this Small Business Innovation Research (SBIR) Phase I project is upgrading the public?s existing electronic U.S. dollars to match and exceed the capabilities of private cryptocurrencies. Distributed-ledger technology has the potential to transform every sector of the economy, but today?s blockchains require users to purchase specific assets before sending payments or using related applications. This has delayed mainstream adoption of blockchain technology and raised concerns that a transition to decentralized commerce could threaten the value of savings held in traditional currency. The proposed project will develop a new technology for protected digital transactions.

This SBIR Phase I project proposes to develop a decentralized blockchain that will eliminate the need for cryptocurrencies by allowing the owners of U.S. dollars to unlock fiat-derived tokens at zero cost. By adapting recent advancements in biological signaling theory to computer science, the project aims to advance new methods in distributed computing. It will replace symmetric Proof-of-Work and Proof-of-Stake vote-weighing mechanisms with a new technology, Proof-of-Balance, that can deliver significant enhancements to security and performance. The proposed work will explore application of the formal mathematical models by developing and deploying an operational Proof-of-Balance network.

This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.

PROJECT OUTCOMES REPORT

Disclaimer

This Project Outcomes Report for the General Public is displayed verbatim as submitted by the Principal Investigator (PI) for this award. Any opinions, findings, and conclusions or recommendations expressed in this Report are those of the PI and do not necessarily reflect the views of the National Science Foundation; NSF has not approved or endorsed its content.

The goal of the Phase I award was to construct the world's first Proof-of-Balance blockchain, which would allow existing owners of electronic fiat money to use smart contracts and decentralized applications without having to purchase new cryptographic tokens. 

KRNC Inc. accomplished that goal in full. It created a test network that allows users to unlock "forked U.S. Dollars" by verifying their bank balances through a secure API. Forked U.S. Dollars can then be transferred to other users, similar to Bitcoin, or used to pay the cost of running smart contracts and decentralized applications.

The Proof-of-Balance blockchain was constructed using modular components that enable communication with other chains and full composability with legacy contracts and applications written for Ethereum. Specifically, it uses the Tendermint consensus algorithm that enables participation in IBC (Inter-Blockchain Communication Protocol), and it runs a custom instance of the EVM (Ethereum Virtual Machine), which allows execution of programs written in the Solidity language. The choice to support full EVM-compatibility also makes the network works seamlessly with the vast array of third-party tooling that has been created for the Ethereum ecosystem, such as the MetaMask wallet and browser extension. 

The test network represents the first blockchain that has been created where stake on the network is controlled by online-banking users, rather than by a small group of participants in an ICO or other distribution event. It eliminates the cost barrier that has previously made it impractical for the general public to participate in Web 3.0. 

Last Modified: 05/23/2022
Modified by: Clinton Ehrlich-Quinn

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