Raiden Network

Raiden extends the idea behind Layer 2 networks to Ethereum: instead of settling every payment directly on the base chain, two parties lock funds into a smart contract and then exchange signed balance updates privately between themselves. This approach, known as a state channel, lets participants transact instantly and without paying gas for each individual transfer, only touching the blockchain when a channel is opened or closed.

Because most users don't have a direct channel with everyone they want to pay, Raiden can route a payment across a network of interconnected channels using hashed timelock contracts, letting it hop from sender to recipient through intermediaries without any single party ever controlling the funds mid-route. The protocol supports Ether alongside ERC-20 and, later, ERC-721 tokens, and is backed by pathfinding and monitoring services that help users find cheap routes and keep channels safe while they are offline.

The project's German developer, brainbot labs, raised funds through an unusual Dutch auction in late 2017 rather than a fixed-price sale, distributing half of a fixed 100 million RDN supply to the public and keeping the rest for development. The RDN token grants no governance or protocol rights; it was designed mainly as one of several possible fee tokens on the network.

Raiden reached its main mainnet milestone with the Alderaan release in 2020, but development has slowed considerably since, and it never matched the adoption of rollup-based Ethereum scaling. It survives today as a working, if largely dormant, example of state-channel technology, with both its client and RDN still carrying an official beta label.