When I was selling my parents' flat, it took two flights, a notary, a bank, and one family reunion to seal the deal. In total, my family has spent one percent of the flat's worth to make sure that we get the other ninety-nine.
What if notaries would cost less than a cent? What if it would take only a few seconds to attest your deal from anywhere in the world?
This is not just about houses. Real estate is just an obvious case. But there are also many, many ideas that never made sense because their implementations were either too insecure or too inefficient to be practical. A cheaper technology would revive these ideas, this technology being a smart contract.
A smart contract is a program that is executed publicly by a network of independent actors — validators. And just like with normal programs, there is a lot that you can do with smart contracts. You can secure deals with a grocery store or your dentist. You can crowdfund a skyscraper along with a million other backers or choose whose turn it is to sweep the street in your commune.
The World's Scale
There is no magic in a smart contract. Think about what a blockchain is — it is just a blob of data about transactions with strict rules on how to add new transactions. Add a few gigabytes of empty space and the rules to edit this space, and you get a blockchain capable of smart contracts — a smart contract chain.
As in their name, blockchains operate in blocks. Blocks take time to calculate and you can fit only that many transactions in a single block. When there are too many transactions, miners have to choose what to process first, and they would naturally pick transactions that offer the highest bribe. Others will have to wait until there is a lull in requests. Blockchains perform just fine on a small scale, but most of them buckle when it comes to the world's economy.
IOTA Smart Contracts, the underlying protocol of Assembly, uses the two-layered model. Layer 1 is the IOTA Tangle, and Layer 2 is hundreds of relatively unpopular smart contract chains. Layer 2 does the bulk of the work and uses Layer 1 for communication and protection.
The Tangle is not a blockchain, so it behaves differently. It works faster as it gets bigger and charges no fees for its transactions, which makes it a perfect Layer 1.
The World's Market
While the two-layer model is technically sound, it introduces another issue. In a single-layered system, validators execute smart contracts as they maintain the network (by calculating blocks). There is a straightforward way to convince a validator to process your smart contract request — you just pay extra in your transaction fee.
With the two-layered model, you have to set up your own smart contract chain and your own committee of validators. You need to search for candidates, decide if you can trust them, and convince them to work for you. Validators might not need your chain's tokens, so you need to acquire some external currency. You could charge your users, or you could design a different business model. These complex dynamics create a diverse, vibrant market.
This is what Assembly is: an open marketplace where chain owners, validators, and users meet. Its technical foundation is big enough to host the whole world's economy, secure enough you could sell houses, and cheap enough you could use it to buy a bottle of beer — or a piece of skyscraper.