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Theta Project: Is It a Hype or a Real Competitor In the Video Market?

15 July 2020 12:35, UTC
Theta Project: Is It a Hype or a Real Competitor In the Video Market?
By Bogdan Vinogradov

The success of Theta tokens (THETA and TFUEL) has recently been amazing. During the crash in March, TETHA traded for only $0.05, and TFUEL even less — for $0.0012 only. But at the end of May, their price soared to $0.43 and $0.019, respectively. What is the reason, and why are their subsequent results less impressive?

What is the idea?

14.07.2020  |   in Cryptocurrencies
The project was launched in 2018 on a solid basis of $17 million private investment, and 20 million were collected during the ICO. The main idea of Theta is a distributed video content exchange based on blockchain technology. Unlike traditional “content delivery networks” that rely on server centers, Theta video is transmitted through node computers connected to the blockchain. In essence, it’s a well-known peer-to-peer technology similar to what the work of torrent trackers is based on. Data exchange between peers takes place within groups of up to 10 users, united on the basis of geographical position and the Internet connection speed.

Thus, it is supposed to solve problems such as poor video quality, speed limits, and the overgrown role of intermediary resources. The latter receive a significant portion of the profits and impose their policies on content authors — which can be avoided through decentralization. Now, when large platforms like Twitch keep blocking even the most popular streamers, this advantage can attract many users.

Two types of tokens coexist in the system. According to the developers, this is necessary to ensure the security and diversity of conflicting functions. THETA is a control token. It is used for staking, for which the nodes receive Theta Fuel (TFUEL), and for managing the system through voting. TFUEL is an operational token introduced in 2019. It is used for working with smart contracts and payment transactions. During the launch of the main network, THETA owners received 5 new tokens each. Now THETA can be exchanged to TFUEL at the rate of “1 to 10”. TFUEL can also be obtained while watching streams on the platform.

Initially, the platform was operated on Ethereum, but in 2019, the transition to a private blockchain took place, and it was recently updated to version 2.0. As a result of the update, the so-called Guardian Nodes appeared, and the support of Multi-BFT was enabled. According to the roadmap, the support for non-video content, such as computer game patches, will also appear shortly.

Breakthrough followed by cooling

Update 2.0 was one of the factors that influenced the "flight to the moon" — but not the only one. Serious business contacts also played a role. Among Theta's partners, you can find not only venture capital funds like Igen Fusion Capital, but also such tech giants as Sony and Samsung. Collaboration with the latter turned out to be especially useful. At the end of May this year, it became known that will be added to the Samsung Daily application, preinstalled on several models of smartphones and tablets produced by the Korean company. Through this, Theta will receive tens of millions of potential users.

Perhaps, even the pandemic helped the project indirectly. Against the background of increased load on servers, Netflix and Youtube had to reduce the quality of the video stream temporarily. But Theta was developed precisely to prevent such situations — which certainly attracted the attention even more.

Alas, for the May growth was followed by a noticeable decline, the pace of which is difficult to be attributed to only one correction. At the time of writing, the THETA course is $0.22, TFUEL is $0.008. One of the reasons for this could be a partnership with Google, which initially caused a huge surge of interest. It was announced that, along with other major players like Binance, Google has become one of the network's validators. However, it soon became clear that the corporation did not purchase THETA tokens, simply allowing to place them in a node on the Google Cloud infrastructure. Some people thought that this was not enough to talk about "partnership."

One way or another, Theta clearly has a future, albeit not as bright as it might have seemed at the end of May. Yes, while is not able to compete with Twitch — but who knows how the project will develop in the coming years.

Image courtesy of Top Brokers

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