With a platform that has tested 7,000 transactions per second, Nano is garnering more and more attention ever since their latest re-branding effort. This project has come a long way since the days of Raiblocks and uses new technology that could disrupt the blockchain industry.
Raiblocks to Nano: A History
In 2014, Colin LeMahieu started working on a Bitcoin alternative that would solve its performance and scalability issues. He envisioned a distributed ledger that was free from the centralization of mining by sharing memory with all transactions on the network, allowing for instantaneous, fee-less transactions. A whitepaper was released in October of 2015, outlining a new way of securing transactions using directed acyclic graph (DAG) technology, which allowed transactions to be updated immediately and asynchronously. This idea took three years to form into a new cryptocurrency known as Raiblocks, which in early 2018 rebranded to Nano.
Instead of the traditional blockchain, technology, Nano utilizes a directed acyclic graph (DAG) model for its decentralized ledger, which is known as a ‘block lattice’ as opposed to a ‘blockchain.’ IOTA is another popular cryptocurrency that utilises a DAG. By using a DAG Nano is able to be lightning fast, feeless, able to scale to thousands of transactions per second and all of this while maintaining a very small carbon footprint.
With the Nano block-lattice, each account has its own blockchain, with only the account owner able to update their chain. To transact on the network, the account owner must provide the computational power to run a transaction, eliminating the need for miners to verify blocks of transactions and the entire network to update the ledger, which in turn creates a system that is instantaneous, extremely efficient and free to transact.
In conjunction with Block Lattice, Nano utilizes a delegate proof-of-stake (dPOS) consensus mechanism to maintain network security. In this dPOS model, each Nano holder has a vote weighted to the amount of Nano held, and stakes their votes to a network node that votes to verify the legitimacy of transactions being conducted.
What is a DAG?
Directed acyclic graph (DAG) technology is an alternative decentralized ledger system that provides more flexibility and speed than traditional blockchains. We cover it in great detail here but we’ll provide a quick explanation here too. Instead of grouping transactions together in blocks, which are then chained together to form a blockchain, a DAG maintains parallel blockchains, one for each private key. When a transaction is made, it only has to be reconciled against the balances of the two accounts involved – the sender and the receiver. The balances and activity of all other accounts on the DAG doesn’t matter, so there’s very little to verify and record – Account A has moved X amount of Nano to Account B. Every already knows the balance of Account A and B, so the nodes on the network have very little work to do, agree the transaction, and it resolves in under a few seconds.
One benefit of this peer-reviewed system is that the cost to transact on a DAG network is negligible, since each transaction is completing confirmation itself and there is no need for outside miners to secure the network. Speed is also improved, as transactions are processed on a micro scale individually, and not on the block level. These two factors make it easy to complete microtransactions on a DAG network, something that the blockchain has yet to realize.
The network effects of DAG are astounding, making it such that the network actually improves in speed and efficiency the more users and transactions come on the network. The more transactions on the network, the more transactions available to verify and secure other transactions, making for an exponentially growing ecosystem. This is in direct opposition to the scaling issues that plague Bitcoin and other blockchains that have a limit to the size of their blocks and amount of transactions that can be processed. Other projects such as IOTA and Byteball also have implemented DAG technology and are seeing increasingly positive feedback as a result.
The development of Nano as a cryptocurrency involves partnerships with other projects and added layers of functionality above and beyond its distributed layer. A partnership with social gaming platform Twitch will allow users to tip using Nano. Tests on the network are being done in conjunction with 1upcoin which acts as the payment processor.
Developers are learning how to integrate Nano with e-commerce shops, allowing consumers to pay for goods using the cryptocurrency. Mobile wallet functionality is on the Nano roadmap, with test payments being successfully completed and release scheduled from sometime in 2018.
Bitgrail hack wrecks havoc
Nothing gets cryptocurrency enthusiasts more scared than malicious attacks that display the lack of security in the industry, and this is exactly the case with Bitgrail. After an internal audit, the cryptocurrency exchange noticed unauthorized transactions that led to the loss of 17 million Nano, at the time resulting in a $170 million loss. Theories abound to the nature of this loss, with some believing Bitgrail’s assertion that it was the result of an outside hacker, and other’s questioning if it was the result of internal fraud at Bitgrail.
This loss is made especially important given the lack of liquidity across markets for Nano. The 17 million token loss is represents roughly ~13% of all Nano, which is a high percentage to now be owned by a hacker, or group of hackers. With Bitgrail now filing for bankruptcy it appears the loss was a death sentence for the Italian exchange.
What does the future hold?
Nano is an amazing next generation distributed ledger technology and its innovations in using a DAG over a traditional blockchain are not to be overlooked. We could see other cryptocurrencies adopt similar technology in the future. Traditional blockchain technology has promised cheap, fast transactions for years and largely has failed to deliver. Nano however has created a truly scalable, decentralized platform for transacting globally. Already proving its mission, with a rate of 7,000 transactions per second and absolutely zero fees, Nano is no doubt destined to soon be acknowledged as one of the top cryptocurrencies.
Join in the discussion on Reddit
Facebook’s blockchain experiment: everything you need to know
Facebook’s blockchain experiment follows in the footsteps of other projects like Telegram, who are setting out to create distributed social networks.
“A lot of us got into technology because we believe it can be a decentralising force that puts more power in people’s hands,” wrote Mark Zuckerberg in his New Year message to his Facebook followers.
This came after a rising view that a small number of Tech companies, mostly based in Silicon Valley, are centralising power rather than decentralising it as their aims appear to show.
Facebook’s blockchain experiment: is there more to it than meets the eye?
His words were seen at the time to simply relate to the political spectrum, and the issues surrounding his social network. However, it’s now clear that there’s more to Zukerbergs notion of decentralisation, according to a report.
Right now, there isn’t a lot of detail to go on, but the company is said to be specifically focused on using cryptocurrency specifically for facilitating payments on the platform, which, given Facebook’s huge user base (including Instagram and WhatsApp), could be a dramatic and important shift. Add on to that the already huge and growing marketplace section of the site which is affecting other selling sites like eBay, a cryptocurrency option could see Facebook making millions virtually overnight.
What is especially interesting is the appointment of David Marcus as head of the Facebook’s blockchain department. This is a man who was serving as the vice president of messaging products and overseeing Facebook Messenger. Marcus is also a former CEO of payments company PayPal, and he currently serves on the board of bitcoin exchange Coinbase. “After nearly four unbelievably rewarding years leading Messenger, I have decided it was time for me to take on a new challenge,” Marcus wrote in a Facebook post, “I’m setting up a small group to explore how to best leverage Blockchain across Facebook, starting from scratch.”
This is an interesting development, and one we’ll keep you updated on as we get more information, so don’t forget to follow us on Twitter.
Why Charles Hoskinson left Ethereum
In The Beginning
Charles Hoskinson fell into the crypto space partially by accident. He started off by reading a few whitepapers, as he had a significant interest in P2P Technologies. He has admitted to having a “Libertarian cypherpunk blend“, which many of the first cryptocurrency enthusiasts would admit to. Hoskinson actually started in the scene by looking at Bitcoin. He formed the ‘Bitcoin Education Project’ which by his description was aimed at “bringing lot’s of people to Bitcoin and teach them why the revolution is so magical and so amazing“. This project was formed as a Unity class, with over 70,000 students.
Following on from that success, and with the knowledge gained from so many students, he decided in around 2013 to get involved more deeply. One of the hottest topics at the time was around decentralized exchanges and very stable cryptocurrencies. That project was called Bitshares and was partially successful.
Foundation of Ethereum
One of the things that Charles Hoskinson found so difficult was how difficult it was to build a programming language. At this time many others including Vitalik Buterin were finding the same issue, and their solutions were similar in concept – namely “What would happen if we had a programming language on top of the protocol?“. This was the first idea of smart contracts. Hoskinson was involved with Ethereum for around 6 months, helping the project “find its identity, find its footing [and] find its marketing”. In an interview, about Etherum Charles Hoskinson said “The big issue, however, was that when they first began the project it was an aggregation of a lot of philosophies, properties, and people. When I came in, I was the unifier to keep all these tribes running and to solve the most important component: How are we going to get funded?”
There then, however, came a decision to be made. Ethereum was doing well, but needed more funding. There was a decision to be made. Do they take VC funding, or not. Involving a VC would likely require governance and the project to be a full for-profit entity. Whereas Hoskinson wanted the project to be more of a non-profit. Charles Hoskinson goes on to say “Concisely, we had a philosophical fight about whether to take VC money or not and I was on the losing side of the fight. I was mutually pushed out of the organization and went on to do other things while they went on to form the foundation.”
As an outsider, we’ll never know the scale of the “fight” or just how mutual the decision to leave was, but it was at that point he then decided to leave the project to Buterin and others to continue. I personally think any project like this that has true aims to change the world has to be non-profit, because at some point there’s going to be a conflict between what is best for the future, and what makes the most money, so controversially I would agree with Hoskinson. Having said that, in our capitalist world, for-profit companies do succeed, and we can’t deny the growth and popularity of Ethereum.
At this point, he said “I’m not going to do this again, I’m not going to do protocols. What I’m going to do is create a factory for protocols”. The idea behind this was to build out both a research firm and an engineering firm, really looking into the science behind cryptocurrencies and only dealing with the specific people that they choose, in a very opinionated way. This project has become the Cardano project, and is growing successfully.
Some would say the Cardano project is even beating Etherum at this point. They may not have the market cap, but even 1.5 years behind Ethereum, Cardano is already utilising a Proof Of Stake alorigthm, while Ethereum is still on the flawed Proof Of Work system, and may well be until next year.
Bitcoin Cash prepares for Hard Fork
Bitcoin Cash Hard Fork scheduled for 15 May 2018
The world’s fourth-largest cryptocurrency by market cap, Bitcoin Cash, is preparing for a hard fork on 15 May.
The world’s fourth-largest cryptocurrency by market cap, Bitcoin Cash, is preparing for a hard fork on 15 May. This latest hard fork was first proposed when seven Bitcoin Cash development teams met in London in November 2017 to discuss the direction of the cryptocurrency.
Bitcoin Cash launched with Hard Fork in August 2017
In August 2017, Bitcoin Cash famously launched with a hard fork, when BCH split from the original bitcoin (BTC) chain. Now, BCH is using the same strategy to enhance the real-world usefulness of its cryptocurrency. The hard fork on May 15th is known as Bitcoin ABC. It quadruples the block size from 8MB to 32MB.
“Legacy” bitcoin (BTC), meanwhile, continues to have a block size of 1MB. BTC has maintained the 1MB block size since launching in 2009 and has experienced significant scaling issues as a result.
Today, BTC can only process approximately seven transactions per second. Meanwhile, credit card networks like VISA and MasterCard can process over 50,000 transactions per second. BTC has proposed a centralized solution called the Lightning Network. This runs outside the original BTC blockchain, while BCH developers emphasize larger block size as an on-chain scaling solution.
Bitcoin Cash was founded on the belief that larger block size will lead to greater transactional capacity. We’ve already seen that belief in action as BCH continues to have lower fees and higher transactional capacity than BTC.
This latest hard fork was first proposed when seven Bitcoin Cash development teams met in London in November 2017 to discuss the direction of the cryptocurrency.
In addition to a block size of 32MB, Bitcoin Cash will reduce block intervals to 2.5 minutes, giving the blockchain speeds similar to Litecoin.
Plus, the hard fork could also potentially activate dormant bitcoin code that would allow the BCH network to offer features similar to ERC20 tokens on the Ethereum network – including allowing users to launch ICOs.
The price of Bitcoin Cash, meanwhile, has surged 20% in the last week. The price of BCH has doubled since the beginning of April.
Hard Fork Upgrades to Bitcoin Cash
The main upgrades in this latest hard fork include:
- Block size will be raised to 32MB, which is the largest possible block size available without changing peer-to-peer protocols
- The hard fork will re-enable the existing opcodes that were disabled earlier (these opcodes are the building blocks for some of the more advanced smart contracts)
- The upper turn size will be increased to 220 bytes from 40 bytes, allowing users to add more data on the upper turn for archiving on the blockchain (this could lead to the launch of “colored coins”, allowing you to track other assets that aren’t validated by miners)
- The possibility of timestamping data (this is also a result of increasing the upper turn size); this would allow users to hash a document and add it to the blockchain in order to prove the existence of the document
All Bitcoin Cash node operators are encouraged to adopt version 0.17.0 prior to the May 15 hard fork. The next Bitcoin Cash hard fork, meanwhile, is scheduled to take place in November 2018.
Zcash vs Zcoin vs PIVX (zkSnarks & ZeroCoin)
Introduction to privacy coins Zcash, Zcoin & PIVX
There’s been some confusion around the “Z-Coins” and their protocols. This article aims to clarify those definitions.
As you can see from this image, the overarching protocol is the Bitcoin one, of which the Bitcoin currency is based. A layer over the Bitcoin protocol is the ZeroCoin protocol; from that the Zcoin and PIVX currencies are based. Then, on top of the ZeroCoin protocol is the ZeroCash Protocol. From that the Zcash currency is based.
A common misconception is that Zcoin is a fork of Zcash. Zcoin is based off the Zerocoin paper while Zcash is based off the Zerocash paper. While the Zerocoin paper and Zerocash paper share common authors and both use zero knowledge proofs, they rely on different cryptography. There is otherwise no relation between the two projects.
PIVX implements ZeroCoin as a coin-mixing service that breaks the link between sender and receiver, and also allows a user to mask their balance of PIVX.
What is ZeroCoin?
Zerocoin is a cryptocurrency protocol proposed by Johns Hopkins University professor Matthew D. Green and graduate students Ian Miers and Christina Garman as an extension to the Bitcoin protocol that would add true cryptographic anonymity to bitcoin transactions. The initial idea was to become a part of the existing cryptographic currency Bitcoin to provide more anonymity to users and performed transactions.
The zerocoin extension to bitcoin was formulates to act like a money laundering pool, temporarily pooling bitcoins together in exchange for a temporary currency called zerocoins. While the laundering pool is an established concept already utilized by several currency laundering services, zerocoin would have implemented this at the protocol level, eliminating any reliance on trusted third parties. It anonymizes the exchanges to and from the pool using cryptographic principles, and as a proposed extension to the bitcoin protocol, it would have recorded the transactions within bitcoin’s existing blockchain.
Zcoin Currency (XZC)
Zerocoin was first implemented into a fully functional cryptocurrency called Zcoin (XZC), a project that went live on September 28, 2016.
Using the Zerocoin protocol, Zcoin allows you to send coins with no transaction history. Bitcoin records the history of every transaction on a public ledger for anyone to see. Wallet addresses are only pseudo-anonymous with the potential for people to link your identity to an address. However, with Zcoin, you can preserve the fungibility and privacy of your transactions.
Creating Zerocoins involves selecting a predetermined number of coins you’d like to mint and a fee of 0.01 Zcoins (XZC). The reason for this, is to improve anonymity. For example, if you mint 1653 Zerocoins and then spend 1653 later, it would be easier to trace the transaction back to you.
You must wait about 70 minutes before you’re allowed to transfer Zerocoins so you should mint well ahead of when you want to spend the currency. Once you actually click spend, the address of your choice receives the Zerocoins with no transaction history.
PIVX Currency (PIVX)
PIVX is the first Proof of Stake cryptocurrency that has implemented the Zerocoin protocol. Zerocoin went live on PIVX on October 16th, 2017. The Zerocoin PIVX tokens are known as zPIV.
Some of the key advantages of PIVX is it’s eco-freindliness. You can stake with less than 5 watts. The implementation of SwiftX Technology also allows almost instant (1 second) transactions.
Pivx is a big competitor to DASH. A lot of the team members in PIVX are from DASH, a currency which recently grew from around $13 to now around $400 (and once peaked at nearly $1000).
Zerocash is a protocol developed and intended to improve upon, Zerocoin. The improved version of the protocol “that reduces proof sizes by 98% and allows for direct anonymous payments that hide payment amount” was announced on 16 November 2013. Zerocash utilizes succinct non-interactive zero-knowledge arguments of knowledge (also known as zk-SNARKs), a special kind of zero-knowledge method for proving the integrity of computations.
Zcash Currency (ZEC)
In late 2015, Zerocash website begun stating that “The Zerocash protocol is being developed into a full-fledged digital currency, Zcash.”
Zcash is a cryptocurrency aimed at using cryptography to provide enhanced privacy for its users compared to other cryptocurrencies such as Bitcoin. The Zerocoin protocol was improved and transformed into the Zerocash system, which was then developed into the Zcash cryptocurrency in 2016.
Zcash is the first widespread application of zk-SNARKs, a novel form of zero-knowledge cryptography. The strong privacy guarantee of Zcash is derived from the fact that shielded transactions in Zcash can be fully encrypted on the blockchain, yet still be verified as valid under the network’s consensus rules by using zk-SNARK proofs.
What is zk-SNARKs?
One of the key technologies implemented in Zcash is zk-SNARKs.
In simple terms, zero-knowledge proofs means that between two parties of a transaction, each party is able to verify to the other that they have a specific set of information, without revealing what that information is. This is significantly different than other systems of proof where at least one party needs to know all the information. An example of this would be a password stored on a server in plain text.
In this case, if you were logging into the server, you need to have the password and the server needs to check if the password you entered is correct. With zero knowledge proofs, the person logging into the server could essentially demonstrate through mathematical proof that they have the correct password without revealing what that password is. Of course today most websites do not store user passwords in plain text and instead, store what is called a hash. Still, hashes can be stolen and under some circumstances can be computed out.
What this means for Zcash is that transactions in can be fully encrypted on the blockchain, yet still be verified as valid under the network’s consensus rules by using zk-SNARK proofs.
$1.7bn is literally too much money, says Telegram bosses!
Telegram’s scrapped the rest of its ICO, raising only $850m of private funding
Telegram announced in January they would launch an ICO to fund its Telegram Open Network (TON). However, since they raised $850m privately, half of what they were intending to raise they have cancelled plans to seek further funding. Even at the time, we reported that $1.7bn was an extraordinary amount of money for what is a centralised, pre-mined, inflationary currency.
Initial plans were to raise $1.7 billion dollars to build their TON network, evenly split between private and public rounds of fundraising. However, after it raised $850 million in its first round of private investment they decided to cancel the public funding round. Less than 200 private companies and/or individuals have participated in Telegram’s offer.
Only investors with a net worth of more than $1 million or an annual income of more than $200,000 can participate in these private sales, and wealthy investors demonstrated a strong interest in Telegram’s project.
TON: the next big thing? Absolutely not.
In their 132-page white paper, detailed in a report from TechCrunch, plans are outlined to use the messaging app’s 180 million users to kickstart a new cryptocurrency that will rapidly scale to meet the needs of users. The wallet could launch as soon as the fourth quarter of 2018 with the “Telegram Open Network” open to users at the start of 2019.
The blockchain will be based on Proof of Stake. Bitcoin and similar tokens use Proof of Work, where miners need to solve difficult math problems to release new funds. This has been criticized as energy intensive, with one analyst suggesting the network has the same annual electricity consumption as the whole of Serbia, at around 32.36 terawatt-hours. Proof of Stake, which asks users to prove their investment in a token, has been suggested as an energy-saving alternative.
Telegram has released a 23-page description of it’s updated plans since their private investment rounds. In it, they describe building out the technology for the TON network as well as further development and maintenance of its main messenger service. In addition, the plans mention a “Visa/Mastercard alternative for a new decentralized economy,” to be based on their blockchain network.
Telegram has argued that current cryptocurrencies in the form of Bitcoin and Ether haven’t attracted a mass market due to structural flaws but with their access to such a large user base, they will be able to bring the new technology to a broader market.
Crypto community skeptical of TON
Jackson Palmer, the founder of early cryptocurrency Dogecoin states “I just think this is the CEO’s way of monetizing Telegram, basically.” He’s probably right, with no clear indication how TON would be any more useful as a cryptocurrency than Ethereum or Nano.
Cryptocurrency lead at Cinnober, Eric Wall says on Twitter: “Just looked through the Telegram ICO 132-page whitepaper for their TON Blockchain. Essentially a 100% premined, centrally issued, unbounded supply, PoS sharding shitcoin. One of the worst whitepaper I ever read. Full of blockchain armchair guessing and baseless estimates. 0/10.”
Good luck Telegram, you’re going to need it.
Unbelievable $1.7bn ICO from Telegram!
Telegram ICO raises TON of money
In the largest ICO of all time, Telegram has raised a TON of money!
Pavel and Nikolai Durov reported that they raised $850 million in the second round of their initial coin offering (ICO) in a notice signed with the US Securities and Exchange Commission.
Most ambitious crypto token sale to date?
The first round of the ICO took place from Jan. 29 to Feb. 13. It managed to attract $850 million from 81 investors to build it’s Telegram Open Network platform, or TON. After 2021, the name of the Telegram Open Network will be changed to The Open Network.
The ICO sought investment to support the development of the Telegram messenger app and its own Blockchain platform Telegraph Open Network. While the document does not disclose the identity of investors, 94 different entities took part in the ICO, which started on March 14. In the column wherein the applicant specifies which type of securities are on offer, the document states “Purchase Agreements for Cryptocurrency.”
Telegram brings cryptocurrency payments to the masses
That’s right, a messaging platform akin to WhatsApp has raised $1.7bn of funds by selling its new cryptocurrency token. Previously, Filecoin had achieved the biggest ICO raising $257m late last year.
However, $257m feels like a large amount of money for one small team to raise in a very short space of time in a very under-regulated space. Now Telegram has raised 7 times that amount of money its hard to see how things can end well. Even putting aside cybersecurity issues and, heaven forbid, a significant compromise, a project with close to a $1.7bn budget carries a lot of risks if not managed properly. Was Telegram making a money grab and just got greedy? While that’s unlikely to be the whole truth, I think they would have been more responsible by raising smaller amounts of money in several stages – lowering the risks involved for everyone.
Given that Telegram already has a successful messaging platform, itself worth billions of dollars, and an established engineering team that supports it its hard to see what scale of project justifies raising this much money so fast.
Let’s hope that Telegram is responsible with the funding its raised, has impeccable security practices protecting their newly acquired hoard and that the Telegram Open Network delivers on its promises of delivering decentralised digital communication – in whatever form that may be!
Update 02/05/2018: Telegram cancels ICO after raising whopping $1.7 billion
After raising a whopping $1.7 billion from around 200 investors, Telegram decided to cancel their Initial Coin Offering (ICO) for its token, Telegram Open Network (TON) and cryptocurrency ‘Gram’.
According to a report in The World Street Journal (WSJ), the ICO was cancelled because Telegram believed it had raised enough money and did not wish to attract the scrutiny of the Securities and Exchanges Commission (SEC).
Recently in the past few months, the SEC has been clamping down on unregulated exchanges and ICOs. It told the Congress that “ICOs are a security and should be regulated as such.”
Telegram officially intends to use the money raised to build a “third-generation” blockchain named TON. This will use the Gram token as its native cryptocurrency for transactions. The company has used various buzzwords around the proposed technology including an “open network” that “can become a Visa/Mastercard alternative for a new decentralized economy.”
However, there have been complaints about lack of transparency. According to CCN ” Telegram has been notoriously opaque about its token sale, with even prospective investors complaining about an inability to convince the company to provide them with concrete details about the offering.”
Update 10/05/2018: Telegram had developed the first service for its future TON platform
Telegram has announced the first service which will become part of its upcoming Telegram Open Network (TON) platform. The company is currently testing it behind closed doors, according to Vedomosti, the Russian media portal. The service is called Telegram Passport a login authentication system. According to a source, the service will be available from next month.
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