Callisto Network report for 2019.

Intro

Callisto Network was first announced on September 25, 2017 in the Ethereum Commonwealth development report. Then, on January 16, 2018 the launch of Callisto Network airdrop was officially announced. On April 15, 2018 Callisto mainnet was succesfully launched.

This repo preserves the history of Callisto development, launch, pre-launch and post-launch issues and the initial roadmap.

The main goals of Callisto Network were stated as:

• Free-of-charge security auditing of smart-contracts.
• Cold staking implementation.
• Crosschain interoperability research.

One of the main goals of Callisto Network was to boost the growth and development of Ethereum CLassic. This goal is considered achieved. All the reference protocols developed by Callisto Team are compatible with Ethereum Classic and the corresponding proposals to implement the described enhancements in ETC are already submitted according to the ECIP process:

• Treasury System proposal (replaces previous Voting Mechanism proposal) and Governance System smart-contract.
• Cold Staking for ETC proposal.
• Security Auditing department of ETC smart-contracts.
• On-chain registry of media resources proposal.

Now it is up to ETC community to support the proposed changes or not. Callisto Team would be happy to provide the implementation for ETC community as well as guide the process of upgrading the protocol since the implementation of proposed changes is as easy as copy&paste.

We believe that the developed protocol modifications could significantly improve the following aspects of the project:

• governance
• development funding and financial transparency
• store of value

It is time for Callisto to shift priorities towards development as an independent project because the promised Ethereum Classic protocol enhancements are successfully delivered already.

Overview

Two main goals of Callisto were already achieved during the previous year: (1) Security Auditing of smart-contracts and (2) Cold Staking implementation.

This year we have achieved another two global goals of the project:

1. Governance System rules and smart-contracts are developed (source codes).
2. Crosschain interoperability research is made and a reference implementation of CLO-to-EOS swap channels is developed (source codes/ announcement).

Since Callisto Network will choose its own independent way of development, it was decided to leave the Ethereum code base. There is no point in maintaining a great number of redundant and deprecated tools and infrastructural services at the cost of Callisto Treasury because it would be an inefficient resource allocation. Thats why the decision to switch to a newer code base and integrate Callisto with the ecosystem of other smart-contract development platforms was made.

It is strongly recommended to take a look at the Callisto development report for 2018 for better understanding of the progress made.

Let me comment each item one by one:

• Governance system — the smart-contract and governance system rules are developed as it is described above. The governance system smart-contract is deployed on Callisto mainnet. However the contract is not activated yet due to the evaluation of the opportunities to switch out from Ethereum code base.
• Monetary policy is developed, implemented and applied. You can track the monetary policy proposal here.
• Constantinople updates are succesfully implemented in go-callisto and rust-callisto clients.
• Proposal submission process for Callisto community members is defined. Any Callisto community member can submit a proposal and request funding here. Accepted proposals are funded through Callisto Treasury. Example: Security Auditing department assistant was hired through the proposal. “Cryptopolis” blockchain game was funded and developed as it received the support of CLO community and the proposal was accepted. Translations of Cold Staking guidelines were funded through proposals (proposal_51 and proposal_52).
• Cold Staking upgrade is developed (source codes). The implementation of Cold Staking v2 is tied to the activation of the governance system contract.
• WASM implementation is researched but it turns out that Callisto will not benefit much from the implementation of a better virtual machine for Ethereum code base since it is planned to switch to a newer code base. WASM is supported in Parity, which is fully compatible with Callisto, but it was decided not to activate WASM support on the CLO network and switch to higher priority tasks.
• Treasury/Cold staking gas fees were not implemented due to the plan to switch to a newer platform that may not have gas fees.
• Decentralized Storage implementation was evaluated. There is no smart-contract development platform with built-in storage feature. Ethereum’s SWARM is not properly usable. EOS storage system was not implemented and smart-contracts must still store data in RAM which is incredibly expensive. The most successful solution is a peripheral service called vRAM provided by LiquidApps that enables EOS smart-contracts to store data. However this is not a native EOS protocol feature. As the result it was decided to store Security Audit reports in IPFS for now and leverage EOS as a potential platform to integrate with.

In addition there are the most important Callisto updates that must be highlighted:

• Monetary policy is succesfully implemented and supported in Monetary Policy Hardfork. The difficulty bomb is diffused.
• Callisto is fully compatible with Parity.
• Callisto has successfully resolved a number of attacks during the year. The Pirl Guard was implemented as an effective solution to 51% attacks.
• CLO is traded on multiple crypto excahnges including Bitfinex and HitBTC.
• CLO chain is officially supported by more than 10 wallets.
• CLO mining is supported by 26 mining pools.

Callisto Network development progress

Financial transparency

Callisto Network adheres to the policy of financial transparency. Treasury address is publicly available and each transaction is commented on-chain. In addition all the transactions are described in the open financial report.

However the team experienced issues with GDPR compatibility and the previous financial report is now deprecated. Since Callisto is now a legal entity we can not publish any information of our employees including their salaries. A new GDPR-compatible version of the financial report can be found here. The new financial report is updated quarterly.

Infrastructure

The infrastructure is currently maintained by Callisto team. This includes:

• Blockchain explorer (explorer2.callisto.network)
• Bootnodes
• Web wallet: wallet.callisto.network
• RPC node
• CLO stats service

Security Auditing Departments

Security auditing department (Solidity) consists of 4 approved auditors and an auditing manager. Our auditors now have significant experience in solidity smart-contracts and Ethereum security.

Callisto Security Department have performed more than 300 security audits in total. This includes security audits of McAfeeDEX, LEO token, BNB token and other recognizable projects. None of the projects that we have audited and approved were ever hacked. Our public audits can serve as a source of statistics for the development of new security standards in the crypto industry.

There was a lot of adjustment work done in the auditing department workflow in order to prepare the Security Department for further automatization:

• reference implementation of Security Auditing Department DAO is developed (source codes)
• the first amendment to the security auditing incentivisation system was developed (source)
• the second amendment to the security auditing incentivisation system was developed to adjust the parameters of incentive distribution (source)
• modification of security department workflow is applied to make it compatible with DAO structure (source)

In general Callisto Security Department proves to be a very efficient method of DAPP security improvement. Security Department system does work as intended despite having some problems with incentivisation/ severity assigning. The next step that will improve the system is automatization of the Security Department workflow with the use of smart-contracts. Unfortunately Ethereum smart-contracts are poorly suited for this purpose.

Security Auditing department (EOS) was formed and a number of security audits of EOS smart-contracts were performed but the Security Department of EOS was closed due to the lack of funding.

Now free security audits are temporarily suspended. Callisto Team is only accepting paid audit requests currently.

Integration with smart-contract development platforms

Callisto is not intended to be a smart-contract development platform. However Callisto has a number of features that smart-contract development platforms could benefit from. At the other hand Callisto requires a source of funding/ promotion from projects with larger communities. This is the reason to integrate with the ecosystem of smart-contract development platforms.

The most advanced smart-contract development platform is EOS nowadays. In addition EOS has built-in source of funding (Block producers, Worker proposals [planned], Block.one has fund that is intended to facilitate the growth of EOS infrastructure).

There was significant research done regarding the EOS capabilities, security concerns and features (congestion analysis, development of a simple game contract, overview of the upcoming changes). EOS has a number of issues that restricts its long term utility but it is still the best smart-contract development platform in the market.

However turning CLO into a token is not the best option at the moment. Callisto will only integrate with other chains with the use of crosschain interoperability at this stage.

Goals for the next year

• Migration to a newer code base or development platform. Ethereum code base poses a lot of restrictions that make the implementation of the governance system and Security Auditing DAO a hard task. Since there are better alternatives at the market Callisto is aiming to utilize the more viable solutions to ensure long term sustainability. There is no reason in maintaining a mineable chain with its own cryptocurrency to perform things that could be done with a use of token on top of a development platform.
• Governance system. Once the decision regarding the Callisto code base update is made the governance system must be either activated on Callisto mainnet or deployed on the newer code base.
• Security Auditing statistic representation and general UX improvement. Callisto Team has performed a lot of security audits but the process of audit requesting and the representation of the results is not user friendly. Callisto aims to become a data source for users / investors / developers when it comes to DAPP security.
• Callisto as an incubator of ideas and startup platform. Callisto Treasury Proposals proves to be an efficient mechanism of the platform. This opens a window of opportunity for Callisto to expand its use case further. The Proposal system and the Governance System contracts can be used to not only govern the development of Callisto chain but also to fund the development of smaller projects that can in theory benefit Callisto somehow. This idea was first introduced in TheDAO however it failed due to the lack of security issues during the implementation phase. Callisto can be more successful in this area since we already have a working Security Department and Proposal system.