Rio Chain is the base layer on which the Rio DeFi ecosystem is going to be built. This is a set of already developed decentralized finance applications that will be launched from the very start and are created by the partners of the project. One of these is MANTRA DAO that provides a wide range of services that include staking, lending, stablecoins, derivatives, governance, grants, and custody. 

Rio Chain is built with scalability, interoperability, and upgradability in mind. Thus it has taken a more centralized approach with the blockchain and consensus model. It has a hybridized model between a permissionless and private that’s called a hybrid federated model. 

Often seen as the solution for financial services, it introduces many actors, unlike in the private blockchain, where only one can grant permission. These actors (users, organizations) are called federation hence the name. 

It is built with the help of Parity’s Substrate framework, which enables compatibility with the Polkadot’s parachains built on Substrate. This is how it can achieve cross-chain interoperability through Polkadot’s interoperability solution.  

Designed in this way with block creation occurring every 2 seconds and, Rio Chain can increase the transaction throughput. Currently, it is looking at 3000 TPS but has the potential to increase it over time. The Federated model ensures long-term scalability and lower transaction costs, and a secure environment in which there aren’t possibilities of 51% attacks. 

Transactions are validated by the Proof-of-Authority (identity-based) consensus mechanism that combines the Substrate framework Aura (Authority Round) and GRANDPA (GHOST-based Recursive ANcestor Deriving Prefix Agreement). Because the network nodes are semi-private, a random Authority (node) is selected to validate the transaction and that only block data with Aura consensus and blockchain finality with GRANDPA. The split of the block data writing and finality verification processes brings more flexibility. 

There are four types of transaction fees on the Rio Chain:

1) Base Transaction Fee: A fixed value is charged for each transaction.

2) Byte Transaction Fee: Charges are based on the size of each byte.

3) Weight Fee: Charge according to the specified transaction weight.

4) Tips: Users can pay tips to increase the priority when packaging a transaction.

In the beginning, Rio Chain will only employ the base transaction fee method, which is currently fixed at 0.1 Rio Fuel (RFUEL).

Rio DeFi’s cornerstone product is its blockchain on which decentralized applications are going to be built. Rio Chain, when compared to other blockchains, represents a shift in network design and development philosophy. Thus it has some key features.

• Block creation time - 2s 

• Transactions per second - 3000 

• Flexible consensus mechanism - Combining two consensus algorithms, one for block data and other for blockchain finality. 

• Interoperability - Utilizing compatibility with Polkadot’s parachain solution to enable the project to be built on top of the Rio Chain can be easily deployed to communicate with other chains. 

• Upgradable - It separates runtime components, allowing easy runtime upgrades without the need for a hard fork. 

Besides the ones that are making it distinct as a blockchain platform Rio Chain also has some unique blockchain features. Each transaction is publicly stored on the ledger and can be easily traceable with the wallet and the block explorer. Smart contracts enable the creation of the decentralized applications and can be written in Rust programing language but also in C/C++, C#, Typescript, Haxe, and Kotlin.

Rio DeFi application can be segmented in three primary use cases:

1) Financial Applications

2) Decentralized E-commerce

3) Payment Solutions

As a blockchain that mainly focuses on hosting decentralized finance applications, its primary use case is powering these applications. There are use cases for Bitcoin lending, Bitcoin savings account, loan programs, etc. Everything you can think of as decentralized finance the Rio Chain is equipped to provide as a base layer. 

The second major use case is in the E-commerce industry. Decentralized e-commerce would mean to disrupt the monopoly of the current platforms that merchants need to use to reach their customers. Not only that, but they are paying high fees and lack vast user data on which they can rely on insights to create sound strategies and drive further profit.

The third major use case is the crypto-fiat gateway. This is a highly significant one because the market still experiences problems with on-ramping new users. This is due to the lack of regulatory frameworks and trust between exchanges and the government’s financial authorities. Exchanges require KYC procedures but are rarely 100% compliant with the laws, and thus banks often refuse to provide a reliable service. Rio DeFi tackles this problem from the very start. Instead of working against the banks, they are working with the banks to help bridge the gap between the money markets by combining traditional and decentralized finance practices. This is only possible because of a more centralized blockchain design the projects have maintained.