Livepeer is an Ethereum-based protocol offering services for live video streaming. It was designed as an alternative to expensive centralized broadcasting companies. Supported by its own cryptocurrency token LPT it aims to reduce infrastructure costs for streaming and video applications. The platform offers transcoding, CDN (a content delivery network), and a network of ingest servers. By combining a blockchain-based protocol with economic incentives and an open media server, it has become cheaper and more scalable than other platforms.
Livepeer Inc., the legal entity behind the project, is headquartered in Brooklyn, NY. It introduced the protocol in March 2017 and in May 2018 the Livepeer network was launched on the Ethereum mainnet, thus becoming fully decentralized. It was initially focused on events dedicated to the crypto community such as DevCon (the Ethereum developers conference) and the Ethereum core developers’ meetings.
The Livepeer platform is based on a delegated proof-of-stake (DPoS) consensus mechanism. The protocol is run by a network of node operators fulfilling transcoding tasks and provides both traditional and web3 video streaming.
In January 2020, the largest Livepeer network upgrade called Streamflow broadened the protocol’s usage from individual event streams to large-scale applications that utilize it for tens or hundreds of simultaneous video streams. The project can be used by developers, single users, and platforms streaming different types of content, GPU cryptocurrency miners, and Livepeer token holders.
The platform enables developers to embed live or on-demand videos into their decentralized applications. Existing miners can become Livepeer community members, lend their computers’ processing power, and generate additional income by transcoding videos for the network using video encoding chips that are dormant during hashing. Broadcasters with large audiences can reduce high infrastructure costs and be charged 10 to 100 times less on the Livepeer network. Token holders ensure security and quality control on the network through staking.
Livepeer is based on a two-layer consensus mechanism. The first layer ensures that the transactions are recorded and secured by the Ethereum blockchain. The second layer handles the allocation of the newly created LPT and verifies that the transcoding was performed correctly.
The Livepeer token
The Livepeer token (LPT) is the protocol’s native utility token of the ERC20 standard created to
keep the network cheap, reliable, effective, and secure. December 13, 2018, was the token genesis day. The ICO was held from July 21, 2018, to October 2, 2018. The maximum LPT supply is capped at 22,906,951 coins. 63.43% of the total token supply has been distributed through crowdsales, 12.35% of coins were allocated among the founders and early team members, 19% was intended for pre-sale purchases, and 5% is reserved for maintaining and developing the network.
LPT coin can be bought or sold on cryptocurrency exchanges. It is traded on 30+ markets. OKEx, Balancer, Coinbase, KuCoin, Binance, and Kraken are examples of exchanges that support the coin. LPT can be stored in any ERC20 compatible crypto wallet or custodian like Gemini. The LPT token is used for staking, rewarding, transferring value, or participating in governance voting. The demand for LPT grows with the network's usage.
New Livepeer tokens are minted every round, which is a period measured in Ethereum blocks. One round is equal to 5760 blocks and lasts approximately 20 hours. The inflation rate is the way by which the protocol determines how many new tokens to mint each round. It depends on how many tokens out of the total circulating supply are staked at that moment and is automatically adjusted. The target participation rate is 50% so the protocol increases or decreases the inflation rate by 0.00005% for every round to reach that number.
How Livepeer works
Broadcasters send video streams to the Livepeer network, which connects them with video transcoders. Livepeer minimizes broadcasting costs through distributed computing. There are two types of network participants responsible for correct transcoding: orchestrators, people who add their computers to the network and provide their CPU, GPU power and bandwidth, and delegators who perform validation work.
Anyone can become an orchestrator by running the necessary software and staking LPT coins. Since 2020, Livepeer has used a probabilistic micropayments protocol to reward orchestrators for their work. It means that they are paid with lottery tickets, a set number of which is intended to win ETH. Rewards are based on the total stake (own stake plus its delegators stake) that is accumulated every day and the amount of work performed by an orchestrator.
Users who do not want to participate as orchestrators can stake their LPT tokens towards transcoders and get a portion of their rewards. They are called delegators and are chosen by token holders through voting. Their job is to keep their node running smoothly to validate transactions.
Newly minted tokens are distributed across delegators and orchestrators in proportion to their total share in relation to other network participants. LPT token holders and developers are allowed to participate in managing and improving the platform through real-time voting.
Livepeer team and partners
The Livepeer project was founded by two entrepreneurs, software engineers, and cryptocurrency enthusiasts Doug Petkanics and Eric Tang. Doug Petkanics is the CEO with a degree in computer science. He has been developing for Livepeer since 2016. Eric Tang is the CTO with a degree in electrical and computer engineering who previously worked for Next Jump and Clickable. Eric and Doug also co-founded Hyperpublic, a geo-local data company, and a publishing platform Wildcard.
Other key team members include Philipp Angele, the Director of Video Product who has created an orchestration protocol for media processing, Jen Wohlner, a Senior Product Manager, Yondon Fu and Eli Mallon, lead software engineers, Adam Soffer, a product engineer, and Angie Ramirez, the Head of Sales.
Livepeer is expanding its partnership network. It has launched a co-mining program with a decentralized storage platform Filecoin to enable its miners to earn rewards on both platforms. A Livepeer Trust was created by crypto asset management firm Grayscale Investments. Vimm, a streaming platform, has integrated Livepeer to handle a great number of concurrent streams.