Proof of Importance is the underlying technology behind NEM which determines who gets to verify transactions. This consensus mechanism is similar to Proof of Stake (PoS) in that it requires a certain amount of cryptocurrency (10,000 XEM in NEMs case) to verify transactions. It differs to PoS in that it solves the issue of a person having more stake being more likely to verify transactions, thus receiving more rewards. In other words, PoS helps the rich get richer, and PoI aims to alleviate that.
Privacy coins: the new cryptocurrency trend
Privacy coins are the new cryptocurrency trend. The privacy-coin trend builds on the bitcoin ideal that virtual coins can become a primary means of making transactions but takes it one step further. With privacy coins, anonymity and privacy are ramped up.
What is a privacy coin?
Bitcoin has received all of the attention as a secure and anonymous form of currency that is ready to take over the world. Yet, it is clear that transacting with Bitcoin does not provide the privacy that many had hoped. This has been in the spotlight with the recent legal case in which the IRS forced Coinbase to hand over user account information and data, striking a blow to the anonymity hopes of Bitcoin users around the world. Luckily there are several other options for coins that are secure and private that could be a solution to this problem.
Why privacy coins?
Cryptocurrencies like bitcoin have a public blockchain that is available to everyone to read. For a given address on the blockchain, anyone can see the balance of that address. While this does provide some convenience (anyone can clearly see, and check any transaction) this isn’t ideal.
Privacy focussed cryptocurrencies, on the other hand, are designed in a way that make it impossible to read certain things about the blockchain. Some prevent viewing an addresses balance, some prevent viewing an addresses transactions and some prevent access to everything. For users, this means that it is impossible for any third party to know anything about their use of the blockchain. This provides an enormous amount of privacy to all users of the blockchain and provides no way for the authorities to understand the transactions on the network.
Many users of cryptocurrency don’t understand why this aspect of privacy is so important. Yet, when digital currency is thought of as similar to transacting via a bank or credit card, it becomes obvious. No consumer would openly display their credit card and bank transaction history to the public, nor would they want the ability to view others’ as well. Keeping user information private and confidential is an important aspect of transacting on the blockchain.
Additionally, without added layers of security, users run the risk of being sent tainted coins that were previously used for illegal activity, and can be traced and/or confiscated by authorities. This makes privacy coins more necessary than ever.
Current privacy coins
There are currently several different privacy coins developed to combat the issues of security and privacy in conjunction with blockchain technology:
Being built upon the most recent decentralized network of Bitcoin Core, Nav Coin’s privacy comes from the utilization of sub-chains on its blockchain which breaks the connection between the sender and receiver in a transaction, making them impossible to trace. Unlike other privacy coins, Nav Coin relies on RSA encryption.
Upcoming plans for Nav Coin include the introduction of anonymous merchant integration, giving consumers the confidence to use Nav Coin to make purchases without having to worry their information will be stolen. NavCoin is also expected to be compatible with hardware wallets as well as credit and debit card issuers so that users can spend their coins across the globe with transactions taking as little as 30 seconds to process and become verified.
Unlike Bitcoin, where a public address reveals all user transaction history, public addresses in Monero are never available for public access or viewing, and instead, a one-time address is created during each transaction that privately secures the transaction itself. Users hold a stealth address which is the only way to access account information.
Another form of Monero security lies in “ring signatures”. A ring signature allows transactions to be mixed together so that it is impossible to tell the details of any one given transaction. When funds are sent, the sender randomly selects several other transactions and funds to be sent cryptographically, making it impossible to determine the true information held in the transaction. Users can even opt to mix-in more senders of the transaction to make it more difficult to hack, although this will increase the size of the transaction and in-turn cause the transaction fee to increase.
In many ways Dash mirrors Bitcoin, and it is even built on much of the same code as Bitcoin itself, with a few major upgrades. Dash’s proprietary technologies allow users to send Dash at lightning speeds anonymously, something that Bitcoin has failed to accomplish in its current state. This is done through a two-tiered system which involves miners and master nodes. Miners verify transactions across the network and create new blocks on the blockchain, while master nodes perform PrivateSend, InstantSend, and governance functions.
PrivateSend means that users of Dash are the only ones with access to their financial transactions and information. This is unlike Bitcoin where each transaction is transmitted on the public blockchain for all to see. InstantSend is an option Dash holders can use to have their transactions verified instantly. This can be done via the master nodes locking in specifications for a transaction so that it can be verified almost instantaneously, without it having to be verified by miners. This innovation in speed is something few other cryptocurrencies have been able to replicate.
As a fork of Dash, PIVX utilizes some of the same principles as Dash, along with added layers of security. PIVX focuses on Private Instantly Verified Transactions (hence the name “PIVX”) on a proof-of-stake platform that utilizes master nodes to verify transactions. PIVX has implemented Zerocoin protocol, a zero-knowledge proof to provide full privacy by converting publically-viewable PIV to anonymous PIV which has no transaction history, much like converting fiat currency into casino chips and then back again to dollars. To make it even harder to trace, this technology (known as zPIV) allows only set denominations to be sent (i.e. 1, 5, 10, 100, 500, etc.), so that hackers cannot search for specific amounts of currency in a transaction in an attempt to steal information.
PIVX is the first cryptocurrency to provide proof-of-stake mining along with zero-knowledge proofs for transaction verification, along with additional security such as in-wallet BIP38 encryption are layered on top to provide additional support, making it a very secure way to transact on the blockchain.
Beware of false promises
There are many great technologies advancing the blockchain in a private and secure way, but at the same time, where there is much progress, there are also several projects labeling themselves as privacy coins that have no basis for their claims.
Verge is a new project and cryptocurrency that claims to offer more privacy than any other cryptocurrency, yet it has taken years to develop and has not proven any of its technology is safer and more private than every other cryptocurrency. Even worse, Verge is adamant about its superiority and makes claims that are misleading to investors and users.
Another misleading coin is Phore, which forked from PIVX, itself a fork of Dash. Phore has brought nothing new to the privacy conversation since its fork from PIVX, and for a long time its code repository on Github was identical to that of PIVX, showing no improvements at all. Phore is an example of a project attempting to take advantage of the new technological advances in privacy and make some quick money in the process.
Private exchanges are the future
Imagine a future when anyone can buy or sell cryptocurrency on a decentralized exchange knowing their transactions are private, secure, and untraceable. That future may not be too far away, as privacy coin PIVX is currently developing its decentralized exchange technology zDEX, which expects to be operational sometime in the beginning of 2018.
zDEX expects to provide users the ability to buy and sell PIVX coins on a marketplace without making use of a centralised exchange to do so, making zDEX the first private decentralized exchange, a hopeful start to a new way to securely buying and selling cryptocurrency. With the advent of zDEX and other technology like it the blockchain industry hopes to move away from the uncertainty of current cryptocurrency exchange models.
Bitcoin (BTC) vs Bitcoin Cash (BCH): What’s The Difference?
In this post, we will be looking at the difference between Bitcoin (BTC) vs Bitcoin Cash (BCH).
Bitcoin (BTC) is a digital currency which was created in 2009 by a mysterious entity using the alias Satoshi Nakamoto. Eight years later on 1st August
Two Different Idealogical Camps: Bitcoin (BTC) vs Bitcoin Cash (BCH)
There are essentially two different idealogical camps in the the Bitcoin (BTC) vs Bitcoin Cash (BCH) debate.
It all started as a discussion about how to change Bitcoin. Something was needed to help it cope better with the increasing number of people using the cryptocurrency.
However, after years of debate, two different ideological camps arose with opposing views on how Bitcoin should scale its protocol. The miners wanted Bitcoin to use bigger blocks while the users and developers wanted to implement SegWit, an upgrade that would compress transaction data, so more transactions could fit in each block.
The argument about how to scale Bitcoin has
The rationale for this was to put the security of the system ahead of functionality which, given the small number of people using Bitcoin in those early days, wasn’t an issue.
The options for lifting this restriction
Another group of developers
The proposal of the Bitcoin core developers, called SegWit2x, wanted to improve the way Bitcoin worked by saying that signatures could be moved to a separate piece of paper, one that is filed along with the sheet containing the transaction information. Because there is more room on the paper, more transactions can be written down. The other proposal was to set a timeline through which the system would allow two sheets of transactions instead of just one
Bitcoin (BTC) vs Bitcoin Cash (BCH): Same Goals But Different Directions!
The goals of the two camps were the same, but neither was willing to compromise on how to get there. Therefore, Bitcoin forked into two different currencies, each sharing a common transaction history from before the fork. Bitcoin Cash is the chain supported by the miners who wanted larger blocks, and the regular Bitcoin chain is the one supported by the core developers.
In terms of the practical intents and purposes of most users, there is very little difference. However, it is imperative to understand that Bitcoin (BTC) and Bitcoin Cash (BCH) are now two entirely separate currencies.
Supporters of Bitcoin Cash looked at SegWit as being an inadequate solution to the problem of scalability. It was also against what Satoshi had envisioned, especially with off-chain solutions.
Even if the upgrade was done, the pro-Bitcoin Cash (BCH) team felt that the way forward lacked transparency and would undermine the blockchain’s decentralization and democratization.
Proof-of-Work (PoW) Consensus Algorithm
Both Bitcoin (BTC) and Bitcoin Cash (BCH) run on the Proof-of-Work (PoW) consensus algorithm.
A Proof-of-Work (PoW) coin uses miners to confirm transactions on the blockchain. This isn’t the most environment-friendly option, as a large amount of energy-consumption is involved; but it is the most effective, compared to other consensus algorithms like Proof-of-Stake (PoS).
Besides not being environmentally friendly and slow there is also an added risk of a 51% attack on the network.
Key Differences Between Bitcoin (BTC) vs Bitcoin Cash (BCH)
One key difference between Bitcoin (BTC) vs Bitcoin Cash (BCH) is the difference in block size. Bitcoin has a 1MB block size, while Bitcoin Cash originally had an 8MB block size. In May 2018 Bitcoin Cash initiated a hard
Bitcoin Cash (BCH) protocol allows for more transactions per second which translates to faster payments and lower fees. However, Bitcoin has much greater security and stability, as there is more mining support and infrastructure behind it.
So what does the future hold for Bitcoin (BTC) vs Bitcoin Cash (BCH)? Do you think there will be a greater demand for Bitcoin Cash (BCH) than Bitcoin (BTC) in the future? We will have to wait and see!
Finally! A Cardano Mobile Wallet!
The last few weeks have been pretty exciting for us at Planet Blockchain. With Coinbase proposing to list 3 of our top currencies, we’ve been working hard on our own contribution to the cryptocurrency space.
A real pain point for us when using Cardano was having to use Daedalus and sync it with the blockchain. This takes ages and is prone to require restarting Daedalus, and/or your computer! No thank you! Even when you achieve the Nirvana state of a sync’ed Daedalus, you now have to input your 12 secret words, aka your private key, to restore your wallet. If you’re not on a device you own and trust then this is obviously not an option. The owner of the device, or, heaven forbid, website, you enter your 12 secret words into has the ability to take all your funds, if they want to. They might do it instantly, they might do it tomorrow, or they might do it in a years time.
So what’s the solution?
A light wallet, or mobile wallet, where the only information you put into the wallet is your public address, or addresses. There is absolutely no way to take someone’s funds just from their address, which makes this a secure solution to looking up your balance. Many of these solutions exist for popular currencies like Bitcoin. If only there was one for Cardano.
Luckily for you, dear reader, we’ve built one.
Once you’ve set up your wallet through Daedalus, you can copy and paste your addresses into the mobile wallet in order to track your balance(s). Make sure to always protect your back up phrase for your wallet and never share it with anyone. Including us, and any other wallet software.
Check out the app and let us know what you think
We at Planet Blockchain are super excited by Cardano and the cryptocurrency space in general and commit to bringing you the highest integrity information on the topics we care about the most. Thank you for being part of our small community and we hope you enjoy the app. You can read more about it here.
Everything you need to know about HTC Exodus
HTC introduces blockchain phone – HTC Exodus
“Our vision is to expand the blockchain ecosystem by creating the world’s first phone dedicated to decentralized applications and security,” HTC states on a website dedicated to the new device.
They go on to say “With the release of the HTC Exodus we can now make this a reality… we believe we can help reshape the internet.”
HTC Exodus Design
HTC hasn’t released any official images of what the Exodus will look like. Instead, the company posted a rough sketch of what appears to be the smartphone’s components. Please see below.
HTC Exodus Spec
There aren’t many details when it comes to spec either. What we do know is that the phone will feature a native cryptocurrency wallet. The HTC Exodus will also support decentralized apps through the phone’s hardware, which it claims are more secure than standard apps. The phone is also expected to allow the trading of native crypto coins without any mining fee. According to their website, there are eight major features of HTC Exodus:
- Trusted hardware
- Tons of protocols
- Universal Wallet
- Trusted UI
- Save your ID and data on phone
- DApps on mobile
- Phone will act as a node of Ethereum and Bitcoin
- Exodus forum for the users
Initially, it will launch with support for Bitcoin, Ethereum, Dfinity networks, and Lightning Network, but the company says it will eventually support the entire blockchain ecosystem. HTC plans on creating a native blockchain network with all eExodus phones, in an effort to double and triple the number of nodes of Ethereum and Bitcoin.
Release date of HTC Exodus
No release date or price has been set for HTC Exodus but you can reserve the HTC Exodus phone online. The company has hinted it might even accept cryptocurrency when the handset does go on sale.
HTC Exodus to run separately from main business
Nano vs Bitcoin Cash
In this article we will be discussing Nano vs Bitcoin Cash. As people begin to see the flaws of Bitcoin,
Nano vs Bitcoin Cash – which cryptocurrency is the leader of the pack?!
What is Nano?
Nano has been tipped to become the next Bitcoin. The main reason for its fast growth and success is because of its architecture. Though the cryptocurrency operates by providing a decentralized model of bypassing centralized institutions such as banks, it design utilizes block-lattice architecture and delegated Proof of Stake (PoS). This eliminates the need for miners, makes the network fast, and lighter.
These unique features and applications mean that Nano is indeed better than Bitcoin and most cryptocurrencies that use Proof of Work (PoW) and standard Proof of Stake (PoS) consensus models.
What is Bitcoin Cash?
Bitcoin Cash is a decentralized peer-to-peer cryptocurrency that was developed from the Bitcoin Core. Bitcoin Cash was formed as a hard fork of Bitcoin. In some cases, you will get the cryptocurrency being referred simply as an upgraded/ peeled/ or forked version of Bitcoin core software released in August 2017. A further Bitcoin Cash hard fork took place in May 2018.
We will now evaluate the advantages and disadvantages of Nano vs Bitcoin Cash.
An analysis of Nano vs Bitcoin Cash: advantages & disadvantages
What are the advantages of Nano?
- No transaction costs
- If you have some cash and want to send abroad using the banking system, the chances are that it will be very expensive. Even the cryptos that came earlier such as Bitcoin and Ethereum are still very expensive. For example, the cost of sending cash using Bitcoin network was more than $ 50 in January of 2018. However, Nano has ushered a new dawn in cryptocurrencies where users can make transactions for free. This is one of the benefits drawing a lot of people to the network.
- Open source & anonymous
- One notable thing about cash stored in the bank is that bank account details can easily get leaked to third parties. Worse still, your bank account can easily get frozen if a court battle whirls to your doorstep. However, Nano is an open source and anonymous network that is hidden from third parties.
- The main network that allows users to own the network
- When people use the standard payment services such as PayPal, MasterCard, and banking, they feel passive. Once they make the savings or send cash, they get the sense of accomplishment and move away. Like other cryptocurrencies, Nano helps people to join, use, and own the network. This means that you are part of the network and your vote will be required when consensus is needed.
- One of the most secure networks
- When people join the cryptocurrency network, they are interested in getting the most secure option for their assets. The delegated proof-of-stake model used in the Nano system helps to keep it secure from miners who might have malicious intentions.
- The commitment of the Nano development team has also managed to keep the system free from hackers since inception. These considerations have won the Nano the tag of the most secure blockchain in the crypto world.
- Allows users to operate with utmost freedom
- If you want to send cash abroad on the weekend or at night, the chances are that it will be impossible. Even those that have some mobile activated applications only allow people to send a limited amount of cash. However, Nano cryptocurrency network is different. The crypto network allows users to operate with utmost freedom. Whether it is at weekend, public holiday, or at night, you are sure of being able to use the network.
- The cryptocurrency value and community has been growing steadily
- The effectiveness of a crypto network is partly gauged by its value and community. For Nano, these parameters have been experiencing positive growth in since inception. As the value took an upward trend early in 2018, the crypto community also kept growing. Many people believe that this growth will keep growing and the crypto could become the next Bitcoin.
What are the disadvantages of Nano?
While the benefits associated with Nano are very many and appealing, it is important to appreciate that the network also comes with a lot of risks. Like other cryptocurrencies, users in the Nano network operate anonymously. While this is seen in many ways as an advantage, it is also a great demerit. The anonymity makes it easy for users to fall to scammers. Other risks of operating in the Nano network include.
- Risk of attack by hackers
- Though the Nano network development team has been working extra hard to keep the network safe, and no successful attack has been reported since inception, you cannot be 100% secure.
- The risk of new and more appealing cryptocurrencies
- The third generation cryptocurrencies such as Nano are mainly aimed at addressing shortcomings noted in the previous networks. For example, Nano targets addressing shortcomings noted in the Bitcoin and Ethereum networks. However, newer and more advanced cryptocurrencies are also likely to emerge in the future and pull down the appeal of Nano. This could lower its value and diminish the trust people have in it.
- High volatility
- Cryptocurrencies such as Nano have demonstrated to be highly volatile. Every time that something related to the crypto industry takes place, Nano and other cryptocurrencies respond immediately. When China announced that it was going to burn ICOs (Initial Coin Offering), Nano value responded by shifting downwards. A similar downward shift was noted when a cryptocurrency exchange was hacked in South Korea towards the end of 2017.
- The looming regulations
- Every country in the globe is working on some form of regulation to help control cryptocurrencies. From China to the United States, the governments are feeling threatened by the cryptocurrencies so much that they want to limit their growth. China has already outlawed ICOs and looks committed to suppressing other crypto related activities. If most countries pass harsh regulations as anticipated, there is a risk that adoption and use of Nano could go down or diminish completely.
- Direct threat to the banking system
- While the first and second generation cryptocurrencies were aimed directly offering an alternative to banks, third generation cryptocurrencies have been working on partnerships. For example, OmiseGO and Ripple provide banks with a platform for enhancing payment as opposed to looking like a direct threat. But Nano architecture aims at replacing the banks especially with its zero transaction fee. This could deny Nano support from such financial institutions as they channel their clients to other friendly networks such as Ripple.
What are the advantages of Bitcoin Cash?
The fast growth of blockchain technologies is an indication of the public acceptance and approval. At first, Bitcoin and other cryptocurrencies were considered disruptive and a threat to the conventional institutions such as banks. But the narrative has changed over time. Today, even governments are starting to appreciate the huge benefits that come with using blockchain technologies. Bitcoin Cash has particularly stood out because of its unique design and fast growing value. Here are the main benefits to anticipate after joining the network.
- Bitcoin Cash is completely anonymous
- The main attraction drawing more users to the BCH network is the high level of privacy. The team behind Bitcoin Cash network targeted enhancing anonymity for all their operations. From traders to individuals, no one wants third parties such as banks to know their personal details. All the transactional info in Bitcoin Cash network are encrypted so that even miners who confirm transactions can only ascertain the amount but not the owners.
- Payment assured across the globe
- If you want to make payment on a weekend, during public holidays, or at night through the bank, it is impossible. Most of these institutions only work between 8 am and 4 pm. However, Bitcoin Cash empowers you to make payments any time of the day or night. Because you have the network right in the wallet or node, sending payment is only a click away. This is the freedom that many have yearned to get for years.
- The network is owned by users
- When you join the Bitcoin Cash network, it becomes yours. That is right. The Bitcoin Cash network is owned by users. You are part of the system and will be involved in making the decisions on the network. Instead of relying on a centralized authority, Bitcoin Cash relies on the consensus of users spread on different nodes in the network.
- Freedom from third-party seizures
- If your cash is in the bank, the risk of getting seized is very high. A case can easily whirlwind into your doorstep and drag you to court. Whether it is a social media or workplace issue, you can easily get involved without necessarily committing a criminal offense. With such risks, the savings in the bank are an easy target by lawyers. However, joining and storing your fund in Bitcoin Cash provides the freedom from third-party seizures. You operate anonymously and at no point will the court freeze your Bitcoin Cash account.
- The value of Bitcoin Cash continues to grow rapidly
- As more cryptocurrencies enter into the fast-growing industry, users want to join those that give them better prospects for growth. Bitcoin Cash is one of them. Though it was only 5 months by close of 2017, it managed to hit top five most valuable cryptocurrencies by then. Its growth has been remarkable with experts in cryptocurrencies indicating that it could easily rival Bitcoin.
What are the disadvantages of Bitcoin Cash?
Just like Bitcoin Cash has numerous benefits, it also comes with a number of risks that users should know of. The hacking in a South Korean exchange at the end of 2017 saw many cryptocurrencies including Bitcoin Cash slump in value. Therefore, no one can be sure of what will happen to Bitcoin Cash in the next few days, months or years. Here are the main disadvantages associated with Bitcoin Cash.
- The risk of being overtaken by newer cryptocurrencies
- Bitcoin Cash was forked from Bitcoin to create a new and more effective cryptocurrency. With new cryptocurrencies joining the industry at a supersonic speed, the risk of Bitcoin Cash getting overtaken by newer and more effective networks is rather high. This could see Bitcoin Cash getting relegated to the back seat as people scramble for the new option.
- The looming regulation
- From the US to China, the topic of cryptocurrencies is a hot potato issue. There is a general feeling that many governments are about to implement laws aimed at punishing cryptocurrencies. For example, Russia and Thailand have cautioned their traders that upcoming laws could make their cryptocurrency related operations illegal. The looming regulations are making a lot of people shy away and could pull down the value of Bitcoin Cash within hours after getting passed into law.
- The danger of losing Bitcoin Cash
- Like other cryptocurrencies, your Bitcoin Cash can also be lost. You could easily lose BCH through hacking of the personal computer, attack on the exchange, or sending to the wrong address. The danger of losing BCH is that they are very difficult to restore. In most of the situations such as sending BCH to the wrong address or getting hacked means that the coins are gone forever.
- The risk of getting involved in scams
- The anonymous nature of Bitcoin Cash has become an instant attraction to fraudsters. Because the transactions are completely encrypted, scammers are sure that they cannot get discovered. This puts users at a risk of getting drawn to scams without knowing. Some scammers often release fake ICOs (Initial Coin Offerings) and steal from unsuspecting clients. Others might opt to acquire or make fake products and sell through the BCH network. You must be extra careful to only buy and carry transactions with trusted addresses.
- High volatility
- While the fast-rising demand for cryptocurrencies has drawn a lot of people into the industry, the level of volatility is very worrying. Within a very short moment, the value of Bitcoin Cash can plummet and cause huge losses. This has been experienced in other cryptocurrencies such as Ethereum during the DAO attack and Bitcoin during the Silk Road Scandal.
- The Com
- Many people have said that the whole idea of Bitcoin Cash was little more than a scam to gain money from the Bitcoin name. Numerous lawsuits have been filed against people who are claiming Bitcoin Cash as being ‘the real bitcoin’, which is marring the currencies reputation.
Nano vs Bitcoin Cash: evauation & conclusion
In the Nano vs Bitcoin Cash debate, both have their advantages and disadvantages as we have seen. However, overall, Nano seems to have the largest scope for growth. The recent ‘‘Bitgrail hack‘ wasn’t a flaw with the technology of the network – the price dip was purely speculative and emotional.
Many coins have been hit hard by the 2018 ‘bear market’ but it seems in comparison Bitcoin Cash has been hit the hardest. Newer altcoins are taking over. Furthermore, an article was recently published stating how Bitcoin Cash might be in trouble. Meanwhile, Nano is among the top coins trading today.
Having evaluated the advantages and disadvantages of the two cryptocurrencies, it would seem in the Nano vs Bitcoin Cash debate, Nano is the stronger cryptocurrency of the two. It is also a hot contender for the most promising cryptocurrency of 2018.
NEM – What you need to know
New Economy Movement (NEM) started off with the ambition of making sure digital currency distribution was widespread and fair. It is one of the few altcoins whose concept is to address all the inherent issues affecting cryptocurrencies such as Bitcoin. Issues such as scalability, energy consumption, ease of use, incentive to use, consolidation of power by miners and governance are what NEM seeks to address.
NEM: Revolutionary peer to peer crypto platform
Launched in 2015, it brings plenty of exciting new ideas to the blockchain.
As with many cryptocurrencies, NEM developers are pseudonymous and it was started by a Bitcoin Talk forum user called UtopianFutur. The inital design was a fork from NXT, but it swiftly got rebuilt from the ground up on its own source code.
NEM has many unique features such as multisignature accounts, encrypted messaging system, and the Eigentrust++ node reputation system. One of the major advantages is its transaction speed. It is for these reasons it is generally viewed as an evolving solution, replete with an outstanding core blockchain technology. The cryptocurrency that runs on it is called XEM.
NEM is primarily used in Japan, but also elsewhere in the world.
|0.000001||µXEM (microXEM) – smallest unit|
|0.001||mXEM (milliXEM) – thousandth unit|
|Date of introduction||2015|
|Genesis Block Production||Fixed 8,999,999,999 XEM total|
Block time 1 minute
Proof Of Importance
One of the key aspects of NEM is its unique consensus mechanism of Proof of Importance. This looks to overcome the problems that can be found in the Proof of Stake model by identifying an account’s overall support of the network. It does this by accounting for three factors: vesting, transaction partners, and number and size of transactions in the last 30 days.
NEM has a feature called harvesting. It doesn’t require any special hardware, you do need to have at least 10,000 vested XEM coins in a single wallet. Anyone running Supernodes and processing transactions get paid by processing the payments for the network. The advantage of harvesting over mining is that it uses a lot less electricity, which means lower transaction fees. This also means that, NEM is much a more energy-efficient cryptocurrency and better than the environment than a coin like Bitcoin (See our post on Bitcoin’s energy usage).
It’s used in a commercial application, called Mijin in Belgium.
Other than that, NEM is still in the early stages and the only real thing you can do with XEM is transfer between people and wallets; there isn’t yet any tangible things you can buy with it.
Buying and Storing
You’re going to want to download the NEM Nano wallet to your PC or mobile phone, and follow the instructions to set it up.
To purchase XEM, you’re limited to a few exchanges right now. Bittrex allows you to purchase XEM with BTC, USD or ETH.
Proof of Importance
How does it work?
PoI solves this dilemma by assigning consensus addresses and an importance score. The importance score can be thought of as a reputation score (kind of like Karma on Reddit). A higher score means the network trusts you more to verify transactions.
In PoI, your chance of verifying transactions isn’t entirely dependent on how much you have to stake. Instead, it’s based on the number and quality of transactions you’ve previously done.
What is a quality transaction?
Well, simply sending yourself a bunch of XEM between addresses isn’t going to do it. You must have sent at least 1000 XEM to addresses holding at least 10,000 XEM staked within the last 30 days.
One risk of Proof of Stake is that people simply hoard as many coins as possible and reap the rewards from block creation. This concentrates wealth while discouraging transactions. These transactions are what keeps the network running. PoIs importance score means that hoarding results in a lower score. Spreading XEM around increases the score. Therefore, being an active participant pays better than hoarding.
What keeps it secure?
You may think that it’s pretty easy to hold a few addresses, pass some XEM between them and shoot up your own importance score, however, the algorithm attempts to prevent this. One way in which it does so is by actually lowering the importance score for accounts that transfer out, then receive XEM. Also, making everyday purchases or sending XEM to an exchange won’t affect your importance score.
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