With the Telekom subsidiary T-Systems MMS and Andreessen Horowitz, the proof-of-stake network Celo is attracting two top-class players. The two companies will actively support the blockchain in the future and should thus contribute to its growth.
The Celo network can boast a success. According to a press release, T-Systems MMS, a subsidiary of Deutsche Telekom, will in future be operating validators on the Celo blockchain – making the proof-of-stake network even more secure.
We want to provide infrastructure on public blockchain networks; In the case of proof-of-stake networks, this ultimately also means providing a staking service. And that’s a good thing, because it gives us a business case, because ultimately we have to work economically as a company and staking enables us to do that too.
So Andreas Dittrich, head of the Blockchain Solution Center at T-Systems MMS in an interview with BTC-ECHO.
Andreessen Horowitz also swears by Celo
But with that the positive news for that Celo network not enough. As the message shows, another top-class Celo Token (CELO) will be delegated to the T-Systems validator. We are talking about the venture capitalist Andreessen Horowitz, who had already invested in the blockchain platform in advance. It is not known how many coins the two companies would like to delegate to their common validator node.
For Andreessen Horowitz, however, it is not the first step in the crypto sector. As we previously reported, the company is already planning its third fund for crypto-related investments – and it has it all. It should be worth a whopping two billion US dollars.
The CELO are to be paced via the Open Telekom Cloud (OTC), which it claims is “strictest[n] Requirements for Security and Compliance ”. In addition to Celo, T-Systems MMS is also on other public blockchains. Celo is the third blockchain “that we actively support with infrastructure,” says Andreas Dittrich, head of the Blockchain Solution Center. With T-Systems MMS and Andreessen Horowitz, two top-class players will be on the Celo network in the future.
Why the choice fell on Celo among the multitude of proof-of-stake platforms, Dittrich explains as follows:
We are not based on market capitalization or the like. We want to support networks that we believe bring real added value and that are solid in terms of strategy and vision – and Celo has been on our radar for a very long time. Some things fit together very well in the Celo network and it is also very close to Telco,
Celo is mobile first
The cooperation between Celo and T-Systems also fits so well because the network is designed as a “mobile-first platform”, says Markus Franke, chief economist at Celo, in an interview. Anyone with a cell phone could take part.
Regardless of whether it is about sending transactions securely or participating in DeFi applications. Celo has had the mission from the beginning to lay the foundations of prosperity for everyone by creating an inclusive financial system: it is open source, it is mobile first, it is particularly fast, scalable and – most importantly – CO2 neutral.
The support from Telekom MMS and Andreessen Horowitz should come at the right time. Because the PoS coin does not really want to assert itself so far. With a market capitalization of 251 million US dollars, CELO ranks only 154th in the Coingecko ranking of top coins. From its all-time high of $ 6.33 on May 18 this year, the coin is down 44 percent at the time of writing.
Is the centralization of the network threatened?
The fact that with Andreessen Horowitz and Telekom two financially strong corporations are stuck on Celo naturally gives rise to concerns about the increasing centralization of the network. After all, the more staked tokens on proof-of-stake networks, the more likely it is to validate blocks and collect rewards. In the second step, the rewards then increase the share of staked coins and increase market power again – similar to an interest rate effect. However, the players are aware of their responsibility and want to actively contribute to Celo becoming more decentralized and not more centralized by entering the market.
“Sure, when two supposed whales act together, the warning lights just have to go on,” admits Dittrich. “But currently we have no problem with too much centralization […]. As far as the impact on the network infrastructure is concerned, we are one of many. It is not our goal to become a central power in the network. That would be unfair behavior ”, Dittrich assures this magazine.
According to Markus Franke, there are currently over 100 validators on the blockchain that two actors there could endanger the network if they wanted to, actually seems implausible.
Most recently, BTC-ECHO reported on Celo’s successful capital round on February 10th: The platform was able to collect 20 million US dollars – Andreessen Horowitz was one of the investors.