How To Mine BitGreen (Proof-Of-Stake Mining Guide ...

VeriCoin

The home for the most innovative cryptocurrency, VeriCoin and Verium VeriCoin: Proof-of-Stake-Time Protocol. PoST Verified. Verium: Proof-of-Work-Time Protocol. PoWT Verified. CPU Mine-able (GPU and ASIC Resistant)
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QuarkCoin Cryptocurrency

Quark is a decentralized digital monetary system. It facilitates sending Quarks to Friends, Family Members Online Payments free of charges and charge-backs. Military Grade Encryption. No Bank or Government Control. Quark coins are based on the original idea of Bitcoin but improved, more secure, faster transaction times and zero fees. With improvements to design and security. There is also a greater coin supply with higher block rewards for miners. Quark is fully Open Source.
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Are two of the largest Bitcoin Miners trying to change the BCH protocol to implement a Proof of Stake smart contract and tokenization platform? We investigate the claims and take a look at the other tokenization platforms available on BCH today.

Are two of the largest Bitcoin Miners trying to change the BCH protocol to implement a Proof of Stake smart contract and tokenization platform? We investigate the claims and take a look at the other tokenization platforms available on BCH today. submitted by The_BCH_Boys to btc [link] [comments]

Are two of the largest Bitcoin Miners trying to change the BCH protocol to implement a Proof of Stake smart contract and tokenization platform? We investigate the claims and take a look at the other tokenization platforms available on BCH today.

Are two of the largest Bitcoin Miners trying to change the BCH protocol to implement a Proof of Stake smart contract and tokenization platform? We investigate the claims and take a look at the other tokenization platforms available on BCH today. submitted by ABitcoinAllBot to BitcoinAll [link] [comments]

Miners already use proof of stake. Those who should have the greatest say in the scaling future of bitcoin should be those with the greatest stakes.

People who own something are naturally incentivized to protect it. For instance... say we decide to go with tweets for the future direction of bitcoin scaling. If we go with tweets and we call them "users" , then there is no proof whatsoever that: a) those are unique individuals b) those "users" have any kind of stake in the protocol they are trying to change.
If we let simple users who have no stake try to decide the changes that comes to the protocol there is nothing to prevent, for example, a hundred thousand Eth users claim they are bitcoin users and simply "vote" on a particular path that would benefit them because they are a beneficiary of the lack of the scaling of bitcoin.
Miners have invested hundreds of millions of dollars into hardware that supports the network. They have perhaps the greatest stake of all since not only is it a great and considerable investment , but it is harder to trade or get rid of hardware than simply the coins themselves. That makes miners even more incentivized than the equivalent coin holder into making the network valuable.
Other things to keep in mind: If we hard fork the worst case scenario is that we have two coins (like eth). By having two coins users and the market will actually have a choice about what they support. It wouldn't be the end of the world. A soft fork gives the market no choice but to support another coin. (Unless this soft fork is UASF and is minority hashrate and which it ends up forking anyway).
The worst part about this scaling debate is the miners who aren't signalling. The status quo is horrible. As a final thought... how often have we heard about the most vocal proponents of blockstream not having any coins at all and not even actually being "users" of the network?
submitted by specialenmity to btc [link] [comments]

Thank you miners for making the economic majority to dislike you and therefore being more in favor of switching to Proof-of-Stake when the time comes. /r/Bitcoin

Thank you miners for making the economic majority to dislike you and therefore being more in favor of switching to Proof-of-Stake when the time comes. /Bitcoin submitted by BitcoinAllBot to BitcoinAll [link] [comments]

Miners already use proof of stake. Those who should have the greatest say in the scaling future of bitcoin should be those with the greatest stakes. /r/btc

Miners already use proof of stake. Those who should have the greatest say in the scaling future of bitcoin should be those with the greatest stakes. /btc submitted by BitcoinAllBot to BitcoinAll [link] [comments]

Hypothetical discussion: How long would it take for bitcoin and it's miners to transition to delegated proof of stake and how would it happen?

Let's say we decide DPOS is the way to go: What is the best hypothetical transition scenario?
submitted by ParsnipCommander to Bitcoin [link] [comments]

Changes coming with Ethereum 2.0

I want to preface this by saying that I am relatively new to the world of blockchain technology.
My question is: if the Ethereum network is switching to a proof-of-stake model instead of the current proof-of-work one, where is intrinsic value of the ETH? With Bitcoin’s 21million mining cap, the value of the Bitcoin comes from not only the demand for it, but from the work of miners (and exorbitant energy consumption), am I wrong? What happens when the currency is no longer generated from work and real-world cost?
submitted by wockerma to ethereum [link] [comments]

Gridcoin 5.0.0.0-Mandatory "Fern" Release

https://github.com/gridcoin-community/Gridcoin-Research/releases/tag/5.0.0.0
Finally! After over ten months of development and testing, "Fern" has arrived! This is a whopper. 240 pull requests merged. Essentially a complete rewrite that was started with the scraper (the "neural net" rewrite) in "Denise" has now been completed. Practically the ENTIRE Gridcoin specific codebase resting on top of the vanilla Bitcoin/Peercoin/Blackcoin vanilla PoS code has been rewritten. This removes the team requirement at last (see below), although there are many other important improvements besides that.
Fern was a monumental undertaking. We had to encode all of the old rules active for the v10 block protocol in new code and ensure that the new code was 100% compatible. This had to be done in such a way as to clear out all of the old spaghetti and ring-fence it with tightly controlled class implementations. We then wrote an entirely new, simplified ruleset for research rewards and reengineered contracts (which includes beacon management, polls, and voting) using properly classed code. The fundamentals of Gridcoin with this release are now on a very sound and maintainable footing, and the developers believe the codebase as updated here will serve as the fundamental basis for Gridcoin's future roadmap.
We have been testing this for MONTHS on testnet in various stages. The v10 (legacy) compatibility code has been running on testnet continuously as it was developed to ensure compatibility with existing nodes. During the last few months, we have done two private testnet forks and then the full public testnet testing for v11 code (the new protocol which is what Fern implements). The developers have also been running non-staking "sentinel" nodes on mainnet with this code to verify that the consensus rules are problem-free for the legacy compatibility code on the broader mainnet. We believe this amount of testing is going to result in a smooth rollout.
Given the amount of changes in Fern, I am presenting TWO changelogs below. One is high level, which summarizes the most significant changes in the protocol. The second changelog is the detailed one in the usual format, and gives you an inkling of the size of this release.

Highlights

Protocol

Note that the protocol changes will not become active until we cross the hard-fork transition height to v11, which has been set at 2053000. Given current average block spacing, this should happen around October 4, about one month from now.
Note that to get all of the beacons in the network on the new protocol, we are requiring ALL beacons to be validated. A two week (14 day) grace period is provided by the code, starting at the time of the transition height, for people currently holding a beacon to validate the beacon and prevent it from expiring. That means that EVERY CRUNCHER must advertise and validate their beacon AFTER the v11 transition (around Oct 4th) and BEFORE October 18th (or more precisely, 14 days from the actual date of the v11 transition). If you do not advertise and validate your beacon by this time, your beacon will expire and you will stop earning research rewards until you advertise and validate a new beacon. This process has been made much easier by a brand new beacon "wizard" that helps manage beacon advertisements and renewals. Once a beacon has been validated and is a v11 protocol beacon, the normal 180 day expiration rules apply. Note, however, that the 180 day expiration on research rewards has been removed with the Fern update. This means that while your beacon might expire after 180 days, your earned research rewards will be retained and can be claimed by advertising a beacon with the same CPID and going through the validation process again. In other words, you do not lose any earned research rewards if you do not stake a block within 180 days and keep your beacon up-to-date.
The transition height is also when the team requirement will be relaxed for the network.

GUI

Besides the beacon wizard, there are a number of improvements to the GUI, including new UI transaction types (and icons) for staking the superblock, sidestake sends, beacon advertisement, voting, poll creation, and transactions with a message. The main screen has been revamped with a better summary section, and better status icons. Several changes under the hood have improved GUI performance. And finally, the diagnostics have been revamped.

Blockchain

The wallet sync speed has been DRASTICALLY improved. A decent machine with a good network connection should be able to sync the entire mainnet blockchain in less than 4 hours. A fast machine with a really fast network connection and a good SSD can do it in about 2.5 hours. One of our goals was to reduce or eliminate the reliance on snapshots for mainnet, and I think we have accomplished that goal with the new sync speed. We have also streamlined the in-memory structures for the blockchain which shaves some memory use.
There are so many goodies here it is hard to summarize them all.
I would like to thank all of the contributors to this release, but especially thank @cyrossignol, whose incredible contributions formed the backbone of this release. I would also like to pay special thanks to @barton2526, @caraka, and @Quezacoatl1, who tirelessly helped during the testing and polishing phase on testnet with testing and repeated builds for all architectures.
The developers are proud to present this release to the community and we believe this represents the starting point for a true renaissance for Gridcoin!

Summary Changelog

Accrual

Changed

Most significantly, nodes calculate research rewards directly from the magnitudes in EACH superblock between stakes instead of using a two- or three- point average based on a CPID's current magnitude and the magnitude for the CPID when it last staked. For those long-timers in the community, this has been referred to as "Superblock Windows," and was first done in proof-of-concept form by @denravonska.

Removed

Beacons

Added

Changed

Removed

Unaltered

As a reminder:

Superblocks

Added

Changed

Removed

Voting

Added

Changed

Removed

Detailed Changelog

[5.0.0.0] 2020-09-03, mandatory, "Fern"

Added

Changed

Removed

Fixed

submitted by jamescowens to gridcoin [link] [comments]

Reasons why NANO fails and will keep failing until some things change

Dear NANO community,
This is going to be a long post where I will discuss why NANO under performed and will keep under performing in this bull run unless some things change.
I'm going to start up with straight facts with the famous quote of Floyd Mayweather: "Men lie, women lie, numbers don't lie".
If you feel offended by some of this, facts don't care about your feelings.
Technical Analysis
In the time where BTC Dominance fell from peak of 74% to 56% and keeps falling, NANO has moved from its low of 0.0000640 sats to a price of 0.0000950 sats. That is about 50% gain if you bought on the absolute low, but looking at the monthly chart, we can see that NANO has basically been in the range of 0.0001400 sats to 0.0000750 sats ever since July of 2019 (for more than 2 years).
https://charts.cointrader.pro/snapshot/zaXzV
The all time high of NANO was 0.0028, so this price is currently 96% down in terms of BTC .
https://charts.cointrader.pro/snapshot/tTF4J
With this price NANO is falling out of top 100 cryptocurrency based on market cap.

My thoughts: Considering that entire altcoin market is moving and that it keeps reaching new highs, this is very concerning for NANO and one can only ask themselves why does NANO keep falling behind?
Why does on every Bitcoin pump price falls hardest and on every day when other altcoins go up 30%, NANO only goes up 10%.
Reasons why NANO is lagging on the market:
We all know that NANO has near instantaneous transactions and is fee-less which is why most of us fell in love with this cryptocurrency.
Problem is that it has little to no adoption. What does it matter if NANO is feeless, when you don't have an exchange that will make a NANO/USD conversion for 0%.
Who cares if STR, XRP and other fast coins have like 0.01$ fee if either way, exchange will take 1% or more fees from you.?
If XRP has better exchange, they can easily be more cost efficient than NANO because of this problem. Devs need to be much more proactive rather than sit and wait while entire market is eating you alive.
Proposed solution: Nano needs to invest more in marketing and in making a deal with exchange that will be liquid enough and provide little to no fees on NANO.

I am a NANO holder ever since 2018 and it's been a long ride with constant buying at the end of each month with average buy of 2$ when I look at it totally.
This is not that bad considering NANO's massive fall and what some other holders had to go through.
Let's remind ourselves again, NANO has 0% inflation. And yet NANO's price doesn't grow. Where as other cryptocurrencies have 5-10% inflation and they are over-performing NANO massively.
NANO holders get no rewards from holding NANO which is a big problem. People call this an advantage and I somewhat agree, but NANO holders need to be rewarded with something, because crypto space doesn't care about inflation.
Proposed solution: Introduce POS (Proof of Stake) with inflation of 5% where NANO holders will be able to stake their NANO and receive 5% more NANO each year. You can do this or make it 6% and after each 2 years, there is halving of inflation. Imagine how coins get hyped when their rewards per year get cut in half. NANO has 0% inflation and it doesn't get any hype. It's already scarce, but people fail to see it.

Current bull run has been ignited with DEFI and because people see that they can earn up to 3-5% daily income just for holding ERC20 token like BAT, BAL, LINK etc. There's even been introudect WBTC (Wrapped Bitcoin) and WETH (Wrapped Ethereum), which means that people can hold their cryptocurrency which they would hold even if there weren't any rewards and they get 3-5% daily income + the chance of the DEFI coin actually pumping by 1000+% which many of them have done in the past month.
Because of all of this people are massively buying ERC20 tokens just to get these gains daily.
What has NANO do to interact with this entire DEFI space? Absolutely nothing.
Did they try to introduce wNANO (wrapped NANO) like Ethereum and Bitcoin did? No.
They just kept working on some other bullshit even-though protocol is in of itself 99% perfect and working. They keep focusing their energy on technology when technology is already better than anything else on the crypto market. NANO is currently the best fast cryptocurrency and it is not even close.
Proposed solution: Devs need to start focusing energy on things that matter and which will help the price and not dump their stash and blindly look how everything else keeps growing.

This is similar to reason number 2 but it has to be said separately. Just ask yourself, who benefits of BTC markets? Miners.
Who benefits of any other POS market? All of the holders.
And then with this money you can finance devs which will work on the currency and will by this raise the price and the whole cycle repeats itself.
So all of these things have in common that people are making money of doing something for the ecosystem. On one hand resources get paid, on the other people that are loyal to the project.
NANO has one of the best and largest communities in cryptocurrency and numbers confirm this, yet there is no special way for any of us to benefit of of this. Everything is open source and people make everything for free.
Proposed solution: Introduce mechanism so that community members can earn money of holding NANO.

Conclusion: Nano is an amazing currency, but there are many things that need to fall in place in order for it to stop falling behind the market.
It's sad that investing in what is called a "safest" altcoin Ethereum, would've made you much better gains than even buying NANO on the all time low would.
This post is meant to be constructive criticism and to in the end open peoples mind on current problem NANO has in the space.
Please share this post so more people and hopefully devs can see it and so that we all as a community can start working towards our goal of NANO becoming one of most utilized cryptocurrencies in the world.
submitted by bizi0909 to nanotrade [link] [comments]

A theory of why Ethereum is perhaps better "sound money" than Bitcoin.

The idea of Bitcoin's supremacy as "sound money" is very frequently thrown around by the biggest talking heads in the crypto world. I know I will get a lot of hate for suggesting that this theory is not only flawed, but it is straight up wrong. As unintuitive as it may sound to Bitcoin maximalists (no offense intended) I believe Ethereum is on the path to becoming the global leading asset and model for sound money... give me a chance to explain why.

  1. The idea that nothing can change Bitcoin's issuance schedule is a myth. There is absolutely no divine power controlling the supply of Bitcoin. Contrary to what is commonly asserted, Bitcoin's issuance protocol is not primarily driven by what is currently implemented. The real driver is consensus: the majority of network participants must agree that what is currently defined cannot be changed. There is an underlying assumption that the consensus would never want to change Bitcoin's issuance. On the surface this makes for a nice "sound money" narrative, but it is false premise and sticking to it could be ultimately detrimental. It presents a long term sustainability issue (the hope that somehow Bitcoin's base layer will scale enough to maintain security entirely through fees). It also completely dismisses the possibility that an unforeseen event could create pressure to change the issuance. If Bitcoin managed to create a consensus mechanism that did not rely on mining, it is very likely there would be consensus to reduce issuance. On the other hand, if some potentially catastrophic event would create incentives to increase the issuance, it would only make sense for the network to do so.
  2. Issuance flexibility is not fundamentally bad. Etheruem's approach to adjust the issuance according to the contextual circumstances has resulted in a faster rate of issuance reduction than what was originally defined in the protocol. The rate of issuance will continue to decrease as new developments allow for it to happen without compromising the network security. There is a very high probability that Ethereum will achieve a lower issuance rate than Bitcoin in the next two years, and it could possibly achieve zero issuance in the next five years. This would be a result of a successful implementation of PoS, sharding and EIP-1559.
  3. The root of all evil is Proof of Work. PoW is by far the primary cost of operating the Bitcoin network. It is the primary determinant of how much issuance is needed as a financial incentive to keep miners doing their thing. The very mechanism that secures the network's decentralization is unfortunately quite wasteful. The degree of decentralization is a direct result of how much random mathematical operations are being done by miners.
  4. There is a better way. Some people will take offense by the use of the word wasteful, and they claim that it is not because those mindless calculations are what is actually securing the network. However, its wasteful aspect becomes clear if there is a different way to achieve equal or superior decentralization without the need to crunch difficult computational problems. This just so happens to be embodied in Ethereum's design of Proof of Stake. It will drastically reduce the cost of securing the network, while providing at least 2-3% annual returns for the ownership of Ether. When Ethereum's issuance becomes lower than its staking rewards, it will effectively have achieved the same effect as having zero (or possibly negative) issuance.
  5. The value proposition of Ethereum 2.0 is unmatched. There is just absolutely no asset in the world that has a 2-3% self-denominated annual returns and just so happens to be rapidly appreciating. When wall-street's greed sees this, it will create the mother of all bubbles.
  6. Don't dismiss the flippening. On February 01 2018 Ethereum reached 70% of Bitcoin's marked cap (it was even closer if you account for the amount of lost bitcoins). That happened before DEFI, before proof of staking was within reach, before multiple effective layer 2 solutions were a thing, before wrapped Bitcoins and before the first signs of mass adoption were on the horizon (like integration with Reddit , VISA and potential to compete with SWIFT). Utility is a huge factor in driving prices, lets not forget how Silk Road played a key role into propelling Bitcoin's value. Yes, Ethereum crashed hard after the peak in 2018, but perhaps it is simply manifesting a higher volatility pattern that is reminiscent of Bitcoin's early years. Bitcoin's first 5 years were characterized by aggressive price swings, why should it be different for Etheruem (considering it is about 5 years younger than Bitcoin)? If the volatility patterns stands on this bull market, we will see a flippening.
So... do I think Etheruem will flip? Yes I do, but I still hold Bitcoin. No one has a crystal ball, and nothing is certain. Perhaps Etheruem will crash and burn, perhaps Bitcoin will become the next Yahoo, and perhaps they will both thrive in this new exciting crypto world.
submitted by TheWierdGuy to ethereum [link] [comments]

[OWL WATCH] Waiting for "IOTA TIME" 20; Hans's re-defined directions for DLT

Disclaimer: This is my editing, so there could be some misunderstandings...
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wellwho오늘 오후 4:50
u/Ben Royce****how far is society2 from having something clickable powered by IOTA?
Ben Royce오늘 오후 4:51
demo of basic tech late sep/ early oct. MVP early 2021
---------------------------------------------------
HusQy
Colored coins are the most misunderstood upcoming feature of the IOTA protocol. A lot of people see them just as a competitor to ERC-20 tokens on ETH and therefore a way of tokenizing things on IOTA, but they are much more important because they enable "consensus on data".
Bob
All this stuff already works on neblio but decentralized and scaling to 3500 tps
HusQy
Neblio has 8 mb blocks with 30 seconds blocktime. This is a throughput of 8 mb / 30 seconds = 267 kb per second. Transactions are 401+ bytes which means that throughput is 267 kb / 401 bytes = 665 TPS. IOTA is faster, feeless and will get even faster with the next update ...
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HusQy
Which DLT would be more secure? One that is collaboratively validated by the economic actors of the world (coporations, companies, foundations, states, people) or one that is validated by an anonymous group of wealthy crypto holders?
HusQy
The problem with current DLTs is that we use protection mechanisms like Proof of Work and Proof of Stake that are inherently hard to shard. The more shards you have, the more you have to distribute your hashing power and your stake and the less secure the system becomes.
HusQy
Real world identities (i.e. all the big economic actors) however could shard into as many shards as necessary without making the system less secure. Todays DLTs waste trust in the same way as PoW wastes energy.
HusQy
Is a secure money worth anything if you can't trust the economic actors that you would buy stuff from? If you buy a car from Volkswagen and they just beat you up and throw you out of the shop after you payed then a secure money won't be useful either :P
HusQy
**I believe that if you want to make DLT work and be successful then we need to ultimately incorporate things like trust in entities into the technology.**Examples likes wirecard show that trusting a single company is problematic but trusting the economy as a whole should be at ...
**... least as secure as todays DLTs.**And as soon as you add sharding it will be orders of magnitude more secure. DLT has failed to deliver because people have tried to build a system in vacuum that completely ignores things that already exist and that you can leverage on.
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HusQy
Blockchain is a bit like people sitting in a room, trying to communicate through BINGO sheets. While they talk, they write down some of the things that have been said and as soon as one screams BINGO! he hands around his sheet to inform everybody about what has been said.
HusQy
If you think that this is the most efficient form of communication for people sitting in the same room and the answer to scalability is to make bigger BINGO sheets or to allow people to solve the puzzle faster then you will most probably never understand what IOTA is working on.
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HusQy
**Blockchain does not work with too many equally weighted validators.****If 400 validators produce a validating statement (block) at the same time then only one can survive as part of a longest chain.**IOTA is all about collaborative validation.
**Another problem of blockchain is that every transaction gets sent twice through the network. Once from the nodes to the miners and a 2nd time from the miners as part of a block.**Blockchain will therefore always only be able to use 50% of the network throughput.
And****the last problem is that you can not arbitrarily decrease the time between blocks as it breaks down if the time between blocks gets smaller than the average network delay. The idle time between blocks is precious time that could be used for processing transactions.
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HusQy
I am not talking about a system with a fixed number of validators but one that is completely open and permissionless where any new company can just spin up a node and take part in the network.
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HusQy
Proof of Work and Proof of Stake are both centralizing sybil-protection mechanism. I don't think that Satoshi wanted 14 mining pools to run the network.
And "economic clustering" was always the "end game" of IOTA.
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HusQy
**Using Proof of Stake is not trustless. Proof of Stake means you trust the richest people and hope that they approve your transactions. The rich are getting richer (through your fees) and you are getting more and more dependant on them.**Is that your vision of the future?
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HusQy
Please read again exactly what I wrote. I have not spoken of introducing governance by large companies, nor have I said that IOTA should be permissioned. We aim for a network with millions or even billions of nodes.

HusQy
That can't work at all with a permissioned ledger - who should then drop off all these devices or authorize them to participate in the network? My key message was the following: Proof of Work and Proof of Stake will always be if you split them up via sharding ...

HusQy
... less secure because you simply need fewer coins or less hash power to have the majority of the votes in a shard. This is not the case with trust in society and the economy. When all companies in the world jointly secure a DLT ...

HusQy
... then these companies could install any number of servers in any number of shards without compromising security, because "trust" does not become less just because they operate several servers. First of all, that is a fact and nothing else.

HusQy
Proof of Work and Proof of Stake are contrary to the assumption of many not "trustless" but follow the maxim: "In the greed of miners we trust!" The basic assumption that the miners do not destroy the system that generates income for them is fundamental here for the ...

HusQy
... security of every DLT. I think a similar assumption would still be correct for the economy as a whole: The companies of the world (and not just the big ones) would not destroy the system with which their customers pay them. In this respect, a system would be ...

HusQy
... which is validated by society and the economy as a whole probably just as "safely" as a system which is validated by a few anonymous miners. Why a small elite of miners should be better validators than any human and ...

HusQy
... To be honest, companies in this world do not open up to me. As already written in my other thread, safe money does not bring you anything if you have to assume that Volkswagen will beat you up and throw you out of the store after you ...

HusQy
... paid for a car. The thoughts I discussed say nothing about the immediate future of IOTA (we use for Coordicide mana) but rather speak of a world where DLT has already become an integral part of our lives and we ...

HusQy
... a corresponding number of companies, non-profit organizations and people have used DLT and where such a system could be implemented. The point here is not to create a governance solution that in any way influences the development of technology ...

HusQy
... or have to give nodes their OK first, but about developing a system that enables people to freely choose the validators they trust. For example, you can also declare your grandma to be a validator when you install your node or your ...

HusQy
... local supermarket. Economic relationships in the real world usually form a close-knit network and it doesn't really matter who you follow as long as the majority is honest. I also don't understand your criticism of censorship, because something like that in IOTA ...

HusQy
... is almost impossible. Each transaction confirms two other transactions which is growing exponentially. If someone wanted to ignore a transaction, he would have to ignore an exponential number of other transactions after a very short time. In contrast to blockchain ...

HusQy
... validators in IOTA do not decide what is included in the ledger, but only decide which of several double spends should be confirmed. Honest transactions are confirmed simply by having other transactions reference them ...

HusQy
... and the "validators" are not even asked. As for the "dust problem", this is indeed something that is a bigger problem for IOTA than for other DLTs because we have no fees, but it is also not an unsolvable problem. Bitcoin initially has a ...

HusQy
Solved similar problem by declaring outputs with a minimum amount of 5430 satoshis as invalid ( github.com/Bitcoin/Bitcoi…). A similar solution where an address must contain a minimum amount is also conceivable for IOTA and we are discussing ...

HusQy
... several possibilities (including compressing dust using cryptographic methods). Contrary to your assumption, checking such a minimum amount is not slow but just as fast as checking a normal transaction. And mine ...

HusQy
... In my opinion this is no problem at all for IOTA's use case. The important thing is that you can send small amounts, but after IOTA is feeless it is also okay to expect the recipients to regularly send their payments on a ...

HusQy
... merge address. The wallets already do this automatically (sweeping) and for machines it is no problem to automate this process. So far this was not a problem because the TPS were limited but with the increased TPS throughput of ...

HusQy
... Chrysalis it becomes relevant and appropriate solutions are discussed and then implemented accordingly. I think that was the most important thing first and if you have further questions just write :)

HusQy
And to be very clear! I really appreciate you and your questions and don't see this as an attack at all! People who see such questions as inappropriate criticism should really ask whether they are still objective. I have little time at the moment because ...

HusQy
... my girlfriend is on tour and has to take care of our daughter, but as soon as she is back we can discuss these things in a video. I think that the concept of including the "real world" in the concepts of DLT is really exciting and ...

HusQy
... that would certainly be exciting to discuss in a joint video. But again, that's more of a vision than a specific plan for the immediate future. This would not work with blockchain anyway but IOTA would be compatible so why not think about such things.
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HusQy
All good my big one :P But actually not that much has changed. There has always been the concept of "economic clustering" which is basically based on similar ideas. We are just now able to implement things like this for the first time.
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HusQy
Exactly. It would mean that addresses "cost" something but I would rather pay a few cents than fees for each transaction. And you can "take" this minimum amount with you every time you change to a new address.

HusQy
All good my big one :P But actually not that much has changed. There has always been the concept of "economic clustering" which is basically based on similar ideas. We are just now able to implement things like this for the first time.
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Relax오늘 오전 1:17
Btw. Hans (sorry for interrupting this convo) but what make people say that IOTA is going the permissioned way because of your latest tweets? I don't get why some people are now forecasting that... Is it because of missing specs or do they just don't get the whole idea?

Hans Moog [IF]오늘 오전 1:20
its bullshit u/Relaxan identity based system would still be open and permissionless where everybody can choose the actors that they deem trustworthy themselves but thats anyway just sth that would be applicable with more adoption
[오전 1:20]
for now we use mana as a predecessor to an actual reputation system

Sissors오늘 오전 1:31
If everybody has to choose actors they deem trustworthy, is it still permissionless? Probably will become a bit a semantic discussion, but still

Hans Moog [IF]오늘 오전 1:34
Of course its permissionless you can follow your grandma if you want to :p

Sissors오늘 오전 1:36
Well sure you can, but you will need to follow something which has a majority of the voting power in the network. Nice that you follow your grandma, but if others dont, her opinion (or well her nodes opinion) is completely irrelevant

Hans Moog [IF]오늘 오전 1:37
You would ideally follow the people that are trustworthy rather than your local drug dealers yeah

Sissors오늘 오전 1:38
And tbh, sure if you do it like that is easy. If you just make the users responsible for only connection to trustworthy nodes

Hans Moog [IF]오늘 오전 1:38
And if your grandma follows her supermarket and some other people she deems trustworthy then thats fine as well
[오전 1:38]
+ you dont have just 1 actor that you follow

Sissors오늘 오전 1:38
No, you got a large list, since yo uwant to follow those which actually matter. So you jsut download a standard list from the internet

Hans Moog [IF]오늘 오전 1:39
You can do that
[오전 1:39]
Is bitcoin permissionless? Should we both try to become miners?
[오전 1:41]
I mean miners that actually matter and not find a block every 10 trillion years 📷
[오전 1:42]
If you would want to become a validator then you would need to build up trust among other people - but anybody can still run a node and issue transactions unlike in hashgraph where you are not able to run your own nodes(수정됨)
[오전 1:48]
Proof of Stake is also not trustless - it just has a builtin mechanism that downloads the trusted people from the blockchain itself (the richest dudes)

Sissors오늘 오전 1:52
I think most agree it would be perfect if every person had one vote. Which is pr oblematic to implement of course. But I really wonder if the solution is to just let users decide who to trust. At the very least I expect a quite centralized network

Hans Moog [IF]오늘 오전 1:53
of course even a trust based system would to a certain degree be centralized as not every person is equally trustworthy as for example a big cooperation
[오전 1:53]
but I think its gonna be less centralized than PoS or PoW
[오전 1:53]
but anyway its sth for "after coordicide"
[오전 1:54]
there are not enough trusted entities that are using DLT, yet to make such a system work reasonably well
[오전 1:54]
I think the reason why blockchain has not really started to look into these kind of concepts is because blockchain doesnt work with too many equally weighted validators
[오전 1:56]
I believe that DLT is only going to take over the world if it is actually "better" than existing systems and with better I mean cheaper, more secure and faster and PoS and PoW will have a very hard time to deliver that
[오전 1:56]
especially if you consider that its not only going to settle value transfers

Relax오늘 오전 1:57
I like this clear statements, it makes it really clear that DLT is still in its infancy

Hans Moog [IF]오늘 오전 1:57
currently bank transfers are order of magnitude cheaper than BTC or ETH transactions

Hans Moog [IF]오늘 오전 1:57
and we you think that people will adopt it just because its crypto then I think we are mistaken
[오전 1:57]
The tech needs to actually solve a problem
[오전 1:57]
and tbh. currently people use PayPal and other companies to settle their payments
[오전 1:58]
having a group of the top 500 companies run such a service together is already much better(수정됨)
[오전 1:58]
especially if its fast and feeless
[오전 2:02]
and the more people use it, the more decentralized it actually becomes
[오전 2:02]
because you have more trustworthy entities to choose of

Evaldas [IF]오늘 오전 2:08
"in the greed of miners we trust"


submitted by btlkhs to Iota [link] [comments]

Top 5 Misconceptions About Blockchain

When we are faced with a new technology, we often look for analogies to understand and describe it. To bridge the knowledge gap, we seek analogies from the universe concepts familiar to us.
In our search for the right analogies, we often risk misunderstanding this new technology. Blockchain technology has introduced a paradigm shift in the way we organize ourselves to generate, account for, transfer and store value. Yet, we are still in early stages of understanding its importance.
In this post I will try to shed light on the top 5 major misconceptions about digital assets and about the open blockchain—a technology that underlies them.
1. Blockchain, not bitcoin
This misconception stems from failing to realize why blockchain exists in the first place. In essence, blockchain is a shared ledger designed to function in an extremely hostile, open environment. It derives its value from the security of its tamper-proof records.
In the blockchain networks powered by proof-of-work (PoW) algorithms, that security is achieved by miners competing to solve a computationally intensive puzzle. The miners do this with the expectation of receiving a digital token as a reward. This digital token can be freely redeemed for fiat currency to cover their operating costs and generate profits. These open systems are designed in such a way that value of their token ultimately dictates the level of security of their network.
When we decouple the concept of blockchain from its underlying token, it simply wipes out most, if not the entire, value proposition the blockchain as a concept.
Implementing blockchain as a token-less system of recordkeeping within a single company is perhaps the prime example of this misconception. Such an endeavor fails to use one of the most valuable properties of the open blockchain. Implementing a blockchain solution in such settings may even be counter-productive especially when better alternatives exist, in the form of databases with proper access control.
Blockchain could be useful in a commercial setting where a consortium of companies decides to use a single ledger to keep track of important transactions. An example of such transactions could be shares of companies that are traded on Wall Street millions of times each day. These transactions are reconciled periodically between the financial institutions by a trusted third-party entity, which could be ultimately replaced by a blockchain-based protocol at a fraction of their cost. That said, these systems may never become as secure and tamper-proof as the open blockchain as the security of the network depends on the number of its minestaking nodes.
2. Exchange Hacks = Digital Assets Are Not Secure
Centralized digital asset exchanges are popular avenues for exchanging digital assets for currencies such as USD or other digital assets. However, their design creates a system of incentives for external or internal actors to compromise them.
When we hear about exchange hacks in the digital asset space, it almost always involves compromising the security of an entity that operates within the traditional server-client architecture. However, the mainstream consciousness conflates the digital exchange security with that of technology that underlies digital assets. Holding a digital asset in a cold storage is extremely secure. Holding it in an exchange is not.
3. Blockchain has low TPS, hence it will never compete with or replace traditional financial infrastructure
Traditional financial systems process a vast number transactions every day. This transaction processing capacity is called throughput and is measured by a metric called transactions per second (TPS). Payment networks such as Visa claim to process up to 56,000 TPS, while traditional exchanges are likely to have much higher capacity to process transactions to accommodate high-frequency trading.
Today, the Bitcoin network processes around 4-5 transactions per second while the second largest digital asset network—Ethereum processes around 15. If we compare the current state of the blockchain technology to the demands of the global financial industry, it is easy to see why such claims could be justified. However, this is a myopic view of this new technology, very much akin to the way Kodak dismissed digital cameras as a potential threat to its business model.
It failed to recognize (i) the speed at which digital cameras would develop and (ii) the fundamental shift the digital cameras introduced in the way we take and store pictures, despite being the company that invented digital cameras in 1975. As the history shows, that was Kodak’s grave mistake.
It is hard to ignore the historical parallels here. The digital asset space is evolving fast. The next-generation networks, which operate under the proof-of-stake consensus mechanism, preserve the securities of proof-of-work, but do away with its capacity limitations. A notable example of that is Cardano. These new networks also represent a shift in the global economic paradigm that many do not seem to notice.
4. Digital Assets Have No Intrinsic Value
The concept of intrinsic value, or lack thereof, is often used to describe digital assets as a purely speculative asset class. While this may apply, with some justification, to digital assets which only claim to function as money, such claims fail to capture the wider nature of platform-based digital assets, which derive their value from the direct use of their networks.
In digital asset platforms like Cardano or Algorand, the native token gives the holder the right to participate in the consensus of the network through the process of staking. The consensus mechanism secures the network, maintains the decentralized ledger, enables participation in the governance of the network and can sustain myriads of decentralized applications with real-world utilities.
Put simply, digital tokens may derive their value from the economic activity that takes place on their networks. The economic activity on such networks, in turn depends on the security of the network, its technical capabilities, its transaction fees and the real-world utility of decentralized applications that reside on them. In that respect, they can be thought of as a new kind of financial instrument. The kind that seamlessly combines the properties of currencies, commodities, and shares of ownership into a single digital token.
These new instruments require that we develop and apply new analytical frameworks to value them, much like the concepts of equities and derivatives did when they first emerged as new financial instruments.
5. Developed Economies Do Not Need Blockchain Technology Because They Have Well-Established Financial/Commercial Solutions.
While it is easy to see how the blockchain technology could unlock a lot of value in the emerging markets, the idea that developed economies do not benefit from this technology is short-sighted.
It is akin to saying that cell phones are a great technology for emerging markets, but developed markets already have land lines, hence do not need them. In a similar vein, we could argue that developed countries do not need internet because most of what internet could do already exists in analog form.
We have to realize that (i) at its core, blockchain is a paradigm-shifting infrastructure/technology and (ii) despite its nascent stage, blockchain is extremely cost-effective… To a degree that it has the capacity to fundamentally disrupt a slew economic sectors out of existence, from banking to real estate, and create new ones.
When we accept this eventuality, we will have to face some uncomfortable truths that many sectors will not exist in their current form or entirely disappear. Currently these sectors provide economic value, employment and generate taxes. If some blockchain-based solution is to replace them in 3-5 years, where would that value migrate? Losing them to open blockchain networks would not be acceptable politically or economically for many developed countries.
One way out of this could be for developed countries to invest in national networks, allowing them to reap the benefits of this new technology, while retaining value from economic activity of their citizens and companies within their jurisdictions.
Another, more realistic way, would be to invest heavily into friendly legal frameworks that would encourage both individuals and companies that would ultimately develop or maintain open blockchain protocols migrate to these jurisdictions, drawing in talent, capital and innovation.
One thing is becoming increasingly clear: we can no longer ignore the elephant in the room. Much like digital cameras and internet itself, blockchain is unstoppable.
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submitted by SkyLightPool to cardano [link] [comments]

Cryptocurrency Staking As It Stands Today

Cryptocurrency Staking As It Stands Today
Everyone and his grandma know what cryptocurrency mining is. Well, they may not indeed know what it actually is, in technical terms, but they have definitely heard the phrase as it is hard to miss the news about mining sucking in energy like a black hole gobbles up matter. On the other hand, staking, its little bro, has mostly been hiding in the shadows until recently.
by StealthEX
Today, with DeFi making breaking news across the cryptoverse, staking has become a new buzzword in the blockchain space and beyond, along with the fresh entries to the crypto asset investor’s vocabulary such as “yield farming”, “rug pull”, “total value locked”, and similar arcane stuff. If you are not scared off yet, then read on. Though we can’t promise you won’t be.

Cryptocurrency staking, little brother of crypto mining

There are two conceptually different approaches to achieving consensus in a distributed network, which comes down to transaction validation in the case of a cryptocurrency blockchain. You are most certainly aware of cryptocurrency mining, which is used with cryptocurrencies based on the Proof-of-Work (PoW) consensus algorithm such as Bitcoin and Ether (so far). Here miners compete against each other with their computational resources for finding the next block on the blockchain and getting a reward.
Another approach, known as the Proof-of-Stake (PoS) consensus mechanism, is based not on the race among computational resources as is the case with PoW, but on the competition of balances, or stakes. In simple words, every holder of at least one stake, a minimally sufficient amount of crypto, can actively participate in creating blocks and thus also earn rewards under such network consensus model. This process came to be known as staking, and it can be loosely thought of as mining in the PoS environment.
With that established, let’s now see why, after so many years of what comes pretty close to oblivion, it has turned into such a big thing.

Why has staking become so popular, all of a sudden?

The renewed popularity of staking came with the explosive expansion of decentralized finance, or DeFi for short. Essentially, staking is one of the ways to tap into the booming DeFi market, allowing users to earn staking rewards on a class of digital assets that DeFi provides easy access to. Technically, it is more correct to speak of DeFi staking as a new development of an old concept that enjoys its second coming today, or new birth if you please. So what’s the point?
With old-school cryptocurrency staking, you would have to manually set up and run a validating node on a cryptocurrency network that uses a PoS consensus algo, having to keep in mind all the gory details of a specific protocol so as not to shoot yourself in the foot. This is where you should have already started to enjoy jitters if you were to take this avenu entirely on your own. Just think of it as having to run a Bitcoin mining rig for some pocket money. Put simply, DeFi staking frees you from all that hassle.
At this point, let’s recall what decentralized finance is and what it strives to achieve. In broad terms, DeFi aims at offering the same products and services available today in the traditional financial world, but in a trutless and decentralized way. From this perspective, DeFi staking reseblems conventional banking where people put their money in savings accounts to earn interest. Indeed, you could try to lend out your shekels all by yourself, with varying degrees of success, but banks make it far more convenient and secure.
The maturation of the DeFi space advanced the emergence of staking pools and Staking-as-a-Service (SaaS) providers that run nodes for PoS cryptocurrencies on your behalf, allowing you to stake your coins and receive staking rewards. In today’s world, interest rates on traditional savings accounts are ridiculous, while government spending, a handy euphemism for relentless money printing aka fiscal stimulus, is already translating into runaway inflation. Against this backdrop, it is easy to see why staking has been on the rise.

Okay, what are my investment options?

Now that we have gone through the basics of the state-of-the-art cryptocurrency staking, you may ask what are the options actually available for a common crypto enthusiast to earn from it? Many high-caliber exchanges like Binance or Bitfinex as well as online wallets such as Coinbase offer staking of PoS coins. In most cases, you don’t even need to do anything aside from simply holding your coins there to start receiving rewards as long as you are eligible and meet the requirements. This is called exchange staking.
Further, there are platforms that specialize in staking digital assets. These are known as Staking-as-a-Service providers, while this form of staking is often referred to as soft staking. They enable even non-tech savvy customers to stake their PoS assets through a third party service, with all the technical stuff handled by the service provider. Most of these services are custodial, with the implication being that you no longer control your coins after you stake them. Figment Networks, MyContainer, Stake Capital are easily the most recognized among SaaS providers.
However, while exchange staking and soft staking have everything to do with finance, they have little to nothing to do with the decentralized part of it, which is, for the record, the primary value proposition of the entire DeFi ecosystem. The point is, you have to deposit the stakable coins into your wallet with these services. And how can it then be considered decentralized? Nah, because DeFi is all about going trustless, no third parties, and, in a narrow sense, no staking that entails the transfer of private keys. This form of staking is called non-custodial, and it is of particular interest from the DeFi point of view.
If you read our article about DeFi, you already know how it is possible, so we won’t dwell on this (if, on the off chance, you didn’t, it’s time to catch up). As DeFi continues to evolve, platforms that allow trustless staking with which you maintain full custody of your coins are set to emerge as well. The space is relatively new, with Staked being probably the first in the field. This type of staking allows you to remain in complete control of your funds, and it perfectly matches DeFi’s ethos, goals and ideals.
Still, our story wouldn’t be complete if we didn’t mention utility tokens where staking may serve a whole range of purposes other than supporting the token network or obtaining passive income. For example, with platforms that deploy blockchain oracles such as Nexus Mutual, a decentralized insurance platform, staking tokens is necessary for encouraging correct reporting on certain events or reaching a consensus on a specific claim. In the case of Nexus Mutual, its membership token NXM is used by the token holders, the so-called assessors, for validating insurance claims. If they fail to assess claims correctly, their stakes are burned.
Another example is Particl Marketplace, a decentralized eCommerce platform, which designed a standalone cryptocurrency dubbed PART. It can be used both as a cryptocurrency in its own right outside the marketplace and as a stakable utility token giving stakers voting rights facilitating the decentralized governance of the entire platform. Yet another example is the instant non-custodial cryptocurrency exchange service, ChangeNOW, that also recently came up with its stakable token, NOW Token, to be used as an internal currency and a means of earning passive income.

What’s next?

Nowadays, with most economies on pause or going downhill, staking has become a new avenue for generating passive income outside the traditional financial system. As DeFi continues to eat away at services previously being exclusively provided by conventional financial and banking sectors, we should expect more people to get involved in this activity along with more businesses dipping their toes into these uncharted waters.
Achieving network consensus, establishing decentralized governance, and earning passive income are only three use cases for cryptocurrency staking. No matter how important they are, and they certainly are, there are many other uses along different dimensions that staking can be quite helpful and instrumental for. Again, we are mostly in uncharted waters here, and we can’t reliably say what the future holds for us. On the other hand, we can go and invent it. This should count as next.
And remember if you need to exchange your coins StealthEX is here for you. We provide a selection of more than 250 coins and constantly updating the list so that our customers will find a suitable option. Our service does not require registration and allows you to remain anonymous. Why don’t you check it out? Just go to StealthEX and follow these easy steps:
✔ Choose the pair and the amount for your exchange. For example ETH to BTC.
✔ Press the “Start exchange” button.
✔ Provide the recipient address to which the coins will be transferred.
✔ Move your cryptocurrency for the exchange.
✔ Receive your coins!
The views and opinions expressed here are solely those of the author. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Original article was posted on https://stealthex.io/blog/2020/09/08/cryptocurrency-staking-as-it-stands-today/
submitted by Stealthex_io to StealthEX [link] [comments]

Two Prime, under the radar coin worth looking into.

Two Prime has released their FF1 MacroToken.
"We show how this methodology can be applied as an Open Source application, in the vein of BTC and ETH, with all the creative and value generative potential that comes along with it. We leverage store of value functions of cryptocurrencies to arrive at value creation and accretion in the real economy by the intermediary of crypto exchanges on which we propose to provide protective measures. We detail treasury and reserve formation for the Open Source Finance Foundation, describe its relation to Two Prime and detail the emission of a new crypto-asset called the FF1 Token.
We seek liquidity for the FF1 treasury within the secondary exchanges for the purpose of applying M4 in the real world, both in the private and public sector. We first apply this to the vertical of cryptocurrencies while outlining the genericity and stability of the model which we indeed to apply to esoteric financial needs (e.g. Smart City financing). In so doing, we extend the scope and control of applications that a system of digital units of value stored on decentralized, public ledgers can aim to advance. We call this approach Open Source Finance and the resulting coin class a MacroToken.
MODERN MONETARY THEORY FRAMEWORKModern Monetary Theory states two interdependent phenomenological axioms and the banking system operates on a resulting syllogism:
In the past 10 years, the formation and emergence of BTC and ETH has verifiably falsified Axiom 2 [1]. The phenomenon of crypto-currencies has created ab-initio global stores of value of type 1a. Cryptoc Currencies have displaced trust by means of government violence and associated, implied violence, with instead, open source distribution, cloud computing, objective mathematics, and the algorithmic integrity of blockchain ledgers. The first “killer app” of these open source ledgers areis stores of value, e.g. Bitcoin, or “open source money” as it was first characterized by its semi-anonymous creators. Leading crypto-currencies have proven themselves as viable global stores of value. They are regulated as Gold is in the United States. However, as type 1a units of value, they have tended towards high volatility inevitably leading to speculative market behavior and near 0 “real” asset-” backing or floor price [2], albeit with an aggregate value of $350bn ab-initio creation.
We therefore advance Axiom 2 to Axiom 2’
At N < 1 we have dilutive debasement of fungible units of value, aka inflation. At 1, the new monies are therefore stable coins. At N > 1, these tokens are designed to grow with demand. Axiom Two Prime (or 2’) displaces government endorsed violence as our macro-socio organizing principle, with algorithmic objectivity and verifiable transparency. This occurs within the landscape we call Open Source Finance.
THE TWO PRIME MODEL
Two Prime refers to the financial management company managing the OSFF. FF1 refers to the Macro Token of the OSFF. The first stage is reserve and treasury formation, the second stage describes the mechanics of the public markets and the protective measures of the reserves and third stage is treasury liquidity via the Continuous Token Offering both in public and private markets. We will now describe these in more detail.
MACRO INVESTMENT THESIS AND RATIONALE FOR FF1The FF1 MacroToken is a synthetic token based on the proven killer applications of Cryptoc-Currencies. After 110 years since the inception of the blockchain technology, the killer apps of crypto are already here and they are primarily all financial, not technical. The historical killers apps are:
The FF1 MacroToken is a pot-pourri of these features, a synthetic token that mixes the best of breed practices of crypto mixing Store-of-Value, Capital Formation and Fractional Asset-Backing.
MACRO INVESTMENT THESIS AND RATIONALE FOR FF1Treasury Generation: Ab-Initio Store of Value On the supply side, The OSFFTwo Prime has created is creating 100, 000, 000 FF1 Macro Tokens, which it keeps in treasury. They are pure stores of value for they have no assets backing them at birth. They are ab-initio instruments. The FF1 Macro Tokens are listed on public crypto exchanges. Two Prime manages operates market- making for these stores of value.
Treasury Management: Supply- Side Tokenomics All FF1 are held in the Open Source Finance Foundation treasury. Crypto aAssets that enter into treasury are, at first, not traded. The FF1 supply will be offered upon sufficient demand. which Two Prime generates publicly and privately. The total supply will be finite in total units (100, 000, 000), but variable in its aggregate value for supply and demand will make the price move. The proceeds are the property of the OSFF (not Two Prime) and Two Prime places invests the liquid treasury (post FF1 liquidation) in crypto assets to protect against depreciation and create a macro-hedge reserve andor floor for the price. It should be noted that the price and the NAV of assets are, by design, not equal. In other words, the additional OSFF treasury is locked and can enter circulation if, and only if, there is a corresponding demand which is then placed invested in crypto assets with a target value N 1. This results in fractional asset- backing at first.
EXCHANGES, CONTINUOUS TOKEN OFFERING, AND DEMAND- SIDE TOKENOMICSPublic Exchanges Two Prime will maintain listings for the FF1 Tokens on behalf of the OSFF. Two Prime maintains market- making operations in public crypto exchanges on behalf of the OSFF.
Continuous Token Offering Two Prime works on creating new liquidity for the FF1 Macro Tokens to comply with the supply side constraints detailed above, namely that a token enters circulation when matched by demand. Two Prime does demand generation in public as above as well as private. This CTO results in something akin to a reverse-ICO, letting the reserves be set by public trading and then marketing to private purchasers investors (accredited US for example) after the public liquidity event. Demand generation is done via marketing to relevant audiences, e.g. as a macro way to HODL with exclusive private equity investments for crypto holders, and as a diversified and de-risked way to gain crypto exposure for FIAT holders (Sharpe ratio: 1.55, Beta to BTC: 0.75).
PARTNER NETWORK, USE OF PROCEEDS, ACCRETION AND FLOOR PROTECTIONThough this mathematical approach allows for a broad and differentiated set of financial applications and outcomes, Two Prime founding Members will first apply this work to the realm of project finance within the Blockchain space via algorithmic balancing of an equity and debt based treasury consisting of real crypto assets and future cash flows.
Proof of Value Mining in Partner Network Funds and projects can apply to the foundation for financing. This is the partner network and is akin to the way a network of miners secure the chain. Here a network of partners protects the value. The Foundation invests the proceeds in liquid crypto assets, interest bearing crypto assets and equity crypto assets via partner funds, creating a bridge to the real economy (crypto companies) in the last step. The foundation holds these (real economic) assets.
M4 Asset Mix The funds raised are invested in public and private sector projects. We consider the following mix
This completes the M4 step and the flow of funds for the FF1 Token. It shows a feedback loop, for the Foundation can buy back it’s token, leading to an idiosyncratic tokenomics: the FF1 Token has a fixed (and potentially diminishing) SUPPLY alongside (potentially increasing) endogenous and exogenous DEMAND."
This seems pretty interesting imo, thoughts?
submitted by Stock-Accountant to CryptoMoonShots [link] [comments]

A theory of why Ethereum is perhaps better "sound money" than Bitcoin.

The idea of Bitcoin's supremacy as "sound money" is very frequently thrown around by the biggest talking heads in the crypto world. I know I will get a lot of hate for suggesting that this theory is not only flawed, but it is straight up wrong. As unintuitive as it may sound to Bitcoin maximalists (no offense intended) I believe Ethereum is on the path to becoming the global leading asset and model for sound money... give me a chance to explain why.
  1. The idea that nothing can change Bitcoin's issuance schedule is a myth. There is absolutely no divine power controlling the supply of Bitcoin. Contrary to what is commonly asserted, Bitcoin's issuance protocol is not primarily driven by what is currently implemented. The real driver is consensus: the majority of network participants must agree that what is currently defined cannot be changed. There is an underlying assumption that the consensus would never want to change Bitcoin's issuance. On the surface this makes for a nice "sound money" narrative, but it is false premise and sticking to it could be ultimately detrimental. It presents a long term sustainability issue (the hope that somehow Bitcoin's base layer will scale enough to maintain security entirely through fees). It also completely dismisses the possibility that an unforeseen event could create pressure to change the issuance. If Bitcoin managed to create a consensus mechanism that did not rely on mining, it is very likely there would be consensus to reduce issuance. On the other hand, if some potentially catastrophic event would create incentives to increase the issuance, it would only make sense for the network to do so.
  2. Issuance flexibility is not fundamentally bad. Etheruem's approach to adjust the issuance according to the contextual circumstances has resulted in a faster rate of issuance reduction than what was originally defined in the protocol. The rate of issuance will continue to decrease as new developments allow for it to happen without compromising the network security. There is a very high probability that Ethereum will achieve a lower issuance rate than Bitcoin in the next two years, and it could possibly achieve zero issuance in the next five years. This would be a result of a successful implementation of PoS, sharding and EIP-1559.
  3. The root of all evil is Proof of Work. PoW is by far the primary cost of operating the Bitcoin network. It is the primary determinant of how much issuance is needed as a financial incentive to keep miners doing their thing. The very mechanism that secures the network's decentralization is unfortunately quite wasteful. The degree of decentralization is a direct result of how much random mathematical operations are being done by miners.
  4. There is a better way. Some people will take offense by the use of the word wasteful, and they claim that it is not because those mindless calculations are what is actually securing the network. However, its wasteful aspect becomes clear if there is a different way to achieve equal or superior decentralization without the need to crunch mathematical problems. This just so happens to be embodied in Ethereum's design of Proof of Stake. It will drastically reduce the cost of securing the network, while providing at least 2-3% annual returns for the ownership of Ether. When Ethereum's issuance becomes lower than its staking rewards, it will effectively have achieved the same effect as having zero (or possibly negative) issuance.
  5. The value proposition of Ethereum 2.0 is unmatched. There is just absolutely no asset in the world that has a 2-3% self-denominated annual returns and just so happens to be rapidly appreciating. When wall-street's greed sees this, it will create the mother of all bubbles.
  6. Don't dismiss the flippening. On February 01 2018 Ethereum reached 70% of Bitcoin's marked cap (it was even closer if you account for the amount of lost bitcoins). That happened before DEFI, before proof of staking was within reach, before multiple effective layer 2 solutions were a thing, before wrapped Bitcoins and before the first signs of mass adoption were on the horizon (like integration with Reddit , VISA and potential to compete with SWIFT). Utility is a huge factor in driving prices, lets not forget how Silk Road played a key role into propelling Bitcoin's value. Yes, Ethereum crashed hard after the peak in 2018, but perhaps it is simply manifesting a higher volatility pattern that is reminiscent of Bitcoin's early years. Bitcoin's first 5 years were characterized by aggressive price swings, why should it be different for Etheruem (considering it is about 5 years younger than Bitcoin)? If the volatility patterns stands on this bull market, we will see a flippening.
So... do I think Etheruem will flip? Yes I do, but I still hold Bitcoin. No one has a crystal ball, and nothing is certain. Perhaps Etheruem will crash and burn, perhaps Bitcoin will become the next Yahoo, and perhaps they will both thrive in this new exciting crypto world.
submitted by TheWierdGuy to CryptoCurrency [link] [comments]

Why i’m bullish on Zilliqa (long read)

Edit: TL;DR added in the comments
 
Hey all, I've been researching coins since 2017 and have gone through 100s of them in the last 3 years. I got introduced to blockchain via Bitcoin of course, analyzed Ethereum thereafter and from that moment I have a keen interest in smart contact platforms. I’m passionate about Ethereum but I find Zilliqa to have a better risk-reward ratio. Especially because Zilliqa has found an elegant balance between being secure, decentralized and scalable in my opinion.
 
Below I post my analysis of why from all the coins I went through I’m most bullish on Zilliqa (yes I went through Tezos, EOS, NEO, VeChain, Harmony, Algorand, Cardano etc.). Note that this is not investment advice and although it's a thorough analysis there is obviously some bias involved. Looking forward to what you all think!
 
Fun fact: the name Zilliqa is a play on ‘silica’ silicon dioxide which means “Silicon for the high-throughput consensus computer.”
 
This post is divided into (i) Technology, (ii) Business & Partnerships, and (iii) Marketing & Community. I’ve tried to make the technology part readable for a broad audience. If you’ve ever tried understanding the inner workings of Bitcoin and Ethereum you should be able to grasp most parts. Otherwise, just skim through and once you are zoning out head to the next part.
 
Technology and some more:
 
Introduction
 
The technology is one of the main reasons why I’m so bullish on Zilliqa. First thing you see on their website is: “Zilliqa is a high-performance, high-security blockchain platform for enterprises and next-generation applications.” These are some bold statements.
 
Before we deep dive into the technology let’s take a step back in time first as they have quite the history. The initial research paper from which Zilliqa originated dates back to August 2016: Elastico: A Secure Sharding Protocol For Open Blockchains where Loi Luu (Kyber Network) is one of the co-authors. Other ideas that led to the development of what Zilliqa has become today are: Bitcoin-NG, collective signing CoSi, ByzCoin and Omniledger.
 
The technical white paper was made public in August 2017 and since then they have achieved everything stated in the white paper and also created their own open source intermediate level smart contract language called Scilla (functional programming language similar to OCaml) too.
 
Mainnet is live since the end of January 2019 with daily transaction rates growing continuously. About a week ago mainnet reached 5 million transactions, 500.000+ addresses in total along with 2400 nodes keeping the network decentralized and secure. Circulating supply is nearing 11 billion and currently only mining rewards are left. The maximum supply is 21 billion with annual inflation being 7.13% currently and will only decrease with time.
 
Zilliqa realized early on that the usage of public cryptocurrencies and smart contracts were increasing but decentralized, secure, and scalable alternatives were lacking in the crypto space. They proposed to apply sharding onto a public smart contract blockchain where the transaction rate increases almost linear with the increase in the amount of nodes. More nodes = higher transaction throughput and increased decentralization. Sharding comes in many forms and Zilliqa uses network-, transaction- and computational sharding. Network sharding opens up the possibility of using transaction- and computational sharding on top. Zilliqa does not use state sharding for now. We’ll come back to this later.
 
Before we continue dissecting how Zilliqa achieves such from a technological standpoint it’s good to keep in mind that a blockchain being decentralised and secure and scalable is still one of the main hurdles in allowing widespread usage of decentralised networks. In my opinion this needs to be solved first before blockchains can get to the point where they can create and add large scale value. So I invite you to read the next section to grasp the underlying fundamentals. Because after all these premises need to be true otherwise there isn’t a fundamental case to be bullish on Zilliqa, right?
 
Down the rabbit hole
 
How have they achieved this? Let’s define the basics first: key players on Zilliqa are the users and the miners. A user is anybody who uses the blockchain to transfer funds or run smart contracts. Miners are the (shard) nodes in the network who run the consensus protocol and get rewarded for their service in Zillings (ZIL). The mining network is divided into several smaller networks called shards, which is also referred to as ‘network sharding’. Miners subsequently are randomly assigned to a shard by another set of miners called DS (Directory Service) nodes. The regular shards process transactions and the outputs of these shards are eventually combined by the DS shard as they reach consensus on the final state. More on how these DS shards reach consensus (via pBFT) will be explained later on.
 
The Zilliqa network produces two types of blocks: DS blocks and Tx blocks. One DS Block consists of 100 Tx Blocks. And as previously mentioned there are two types of nodes concerned with reaching consensus: shard nodes and DS nodes. Becoming a shard node or DS node is being defined by the result of a PoW cycle (Ethash) at the beginning of the DS Block. All candidate mining nodes compete with each other and run the PoW (Proof-of-Work) cycle for 60 seconds and the submissions achieving the highest difficulty will be allowed on the network. And to put it in perspective: the average difficulty for one DS node is ~ 2 Th/s equaling 2.000.000 Mh/s or 55 thousand+ GeForce GTX 1070 / 8 GB GPUs at 35.4 Mh/s. Each DS Block 10 new DS nodes are allowed. And a shard node needs to provide around 8.53 GH/s currently (around 240 GTX 1070s). Dual mining ETH/ETC and ZIL is possible and can be done via mining software such as Phoenix and Claymore. There are pools and if you have large amounts of hashing power (Ethash) available you could mine solo.
 
The PoW cycle of 60 seconds is a peak performance and acts as an entry ticket to the network. The entry ticket is called a sybil resistance mechanism and makes it incredibly hard for adversaries to spawn lots of identities and manipulate the network with these identities. And after every 100 Tx Blocks which corresponds to roughly 1,5 hour this PoW process repeats. In between these 1,5 hour, no PoW needs to be done meaning Zilliqa’s energy consumption to keep the network secure is low. For more detailed information on how mining works click here.
Okay, hats off to you. You have made it this far. Before we go any deeper down the rabbit hole we first must understand why Zilliqa goes through all of the above technicalities and understand a bit more what a blockchain on a more fundamental level is. Because the core of Zilliqa’s consensus protocol relies on the usage of pBFT (practical Byzantine Fault Tolerance) we need to know more about state machines and their function. Navigate to Viewblock, a Zilliqa block explorer, and just come back to this article. We will use this site to navigate through a few concepts.
 
We have established that Zilliqa is a public and distributed blockchain. Meaning that everyone with an internet connection can send ZILs, trigger smart contracts, etc. and there is no central authority who fully controls the network. Zilliqa and other public and distributed blockchains (like Bitcoin and Ethereum) can also be defined as state machines.
 
Taking the liberty of paraphrasing examples and definitions given by Samuel Brooks’ medium article, he describes the definition of a blockchain (like Zilliqa) as: “A peer-to-peer, append-only datastore that uses consensus to synchronize cryptographically-secure data”.
 
Next, he states that: "blockchains are fundamentally systems for managing valid state transitions”. For some more context, I recommend reading the whole medium article to get a better grasp of the definitions and understanding of state machines. Nevertheless, let’s try to simplify and compile it into a single paragraph. Take traffic lights as an example: all its states (red, amber, and green) are predefined, all possible outcomes are known and it doesn’t matter if you encounter the traffic light today or tomorrow. It will still behave the same. Managing the states of a traffic light can be done by triggering a sensor on the road or pushing a button resulting in one traffic lights’ state going from green to red (via amber) and another light from red to green.
 
With public blockchains like Zilliqa, this isn’t so straightforward and simple. It started with block #1 almost 1,5 years ago and every 45 seconds or so a new block linked to the previous block is being added. Resulting in a chain of blocks with transactions in it that everyone can verify from block #1 to the current #647.000+ block. The state is ever changing and the states it can find itself in are infinite. And while the traffic light might work together in tandem with various other traffic lights, it’s rather insignificant comparing it to a public blockchain. Because Zilliqa consists of 2400 nodes who need to work together to achieve consensus on what the latest valid state is while some of these nodes may have latency or broadcast issues, drop offline or are deliberately trying to attack the network, etc.
 
Now go back to the Viewblock page take a look at the amount of transaction, addresses, block and DS height and then hit refresh. Obviously as expected you see new incremented values on one or all parameters. And how did the Zilliqa blockchain manage to transition from a previous valid state to the latest valid state? By using pBFT to reach consensus on the latest valid state.
 
After having obtained the entry ticket, miners execute pBFT to reach consensus on the ever-changing state of the blockchain. pBFT requires a series of network communication between nodes, and as such there is no GPU involved (but CPU). Resulting in the total energy consumed to keep the blockchain secure, decentralized and scalable being low.
 
pBFT stands for practical Byzantine Fault Tolerance and is an optimization on the Byzantine Fault Tolerant algorithm. To quote Blockonomi: “In the context of distributed systems, Byzantine Fault Tolerance is the ability of a distributed computer network to function as desired and correctly reach a sufficient consensus despite malicious components (nodes) of the system failing or propagating incorrect information to other peers.” Zilliqa is such a distributed computer network and depends on the honesty of the nodes (shard and DS) to reach consensus and to continuously update the state with the latest block. If pBFT is a new term for you I can highly recommend the Blockonomi article.
 
The idea of pBFT was introduced in 1999 - one of the authors even won a Turing award for it - and it is well researched and applied in various blockchains and distributed systems nowadays. If you want more advanced information than the Blockonomi link provides click here. And if you’re in between Blockonomi and the University of Singapore read the Zilliqa Design Story Part 2 dating from October 2017.
Quoting from the Zilliqa tech whitepaper: “pBFT relies upon a correct leader (which is randomly selected) to begin each phase and proceed when the sufficient majority exists. In case the leader is byzantine it can stall the entire consensus protocol. To address this challenge, pBFT offers a view change protocol to replace the byzantine leader with another one.”
 
pBFT can tolerate ⅓ of the nodes being dishonest (offline counts as Byzantine = dishonest) and the consensus protocol will function without stalling or hiccups. Once there are more than ⅓ of dishonest nodes but no more than ⅔ the network will be stalled and a view change will be triggered to elect a new DS leader. Only when more than ⅔ of the nodes are dishonest (66%) double-spend attacks become possible.
 
If the network stalls no transactions can be processed and one has to wait until a new honest leader has been elected. When the mainnet was just launched and in its early phases, view changes happened regularly. As of today the last stalling of the network - and view change being triggered - was at the end of October 2019.
 
Another benefit of using pBFT for consensus besides low energy is the immediate finality it provides. Once your transaction is included in a block and the block is added to the chain it’s done. Lastly, take a look at this article where three types of finality are being defined: probabilistic, absolute and economic finality. Zilliqa falls under the absolute finality (just like Tendermint for example). Although lengthy already we skipped through some of the inner workings from Zilliqa’s consensus: read the Zilliqa Design Story Part 3 and you will be close to having a complete picture on it. Enough about PoW, sybil resistance mechanism, pBFT, etc. Another thing we haven’t looked at yet is the amount of decentralization.
 
Decentralisation
 
Currently, there are four shards, each one of them consisting of 600 nodes. 1 shard with 600 so-called DS nodes (Directory Service - they need to achieve a higher difficulty than shard nodes) and 1800 shard nodes of which 250 are shard guards (centralized nodes controlled by the team). The amount of shard guards has been steadily declining from 1200 in January 2019 to 250 as of May 2020. On the Viewblock statistics, you can see that many of the nodes are being located in the US but those are only the (CPU parts of the) shard nodes who perform pBFT. There is no data from where the PoW sources are coming. And when the Zilliqa blockchain starts reaching its transaction capacity limit, a network upgrade needs to be executed to lift the current cap of maximum 2400 nodes to allow more nodes and formation of more shards which will allow to network to keep on scaling according to demand.
Besides shard nodes there are also seed nodes. The main role of seed nodes is to serve as direct access points (for end-users and clients) to the core Zilliqa network that validates transactions. Seed nodes consolidate transaction requests and forward these to the lookup nodes (another type of nodes) for distribution to the shards in the network. Seed nodes also maintain the entire transaction history and the global state of the blockchain which is needed to provide services such as block explorers. Seed nodes in the Zilliqa network are comparable to Infura on Ethereum.
 
The seed nodes were first only operated by Zilliqa themselves, exchanges and Viewblock. Operators of seed nodes like exchanges had no incentive to open them for the greater public. They were centralised at first. Decentralisation at the seed nodes level has been steadily rolled out since March 2020 ( Zilliqa Improvement Proposal 3 ). Currently the amount of seed nodes is being increased, they are public-facing and at the same time PoS is applied to incentivize seed node operators and make it possible for ZIL holders to stake and earn passive yields. Important distinction: seed nodes are not involved with consensus! That is still PoW as entry ticket and pBFT for the actual consensus.
 
5% of the block rewards are being assigned to seed nodes (from the beginning in 2019) and those are being used to pay out ZIL stakers. The 5% block rewards with an annual yield of 10.03% translate to roughly 610 MM ZILs in total that can be staked. Exchanges use the custodial variant of staking and wallets like Moonlet will use the non-custodial version (starting in Q3 2020). Staking is being done by sending ZILs to a smart contract created by Zilliqa and audited by Quantstamp.
 
With a high amount of DS; shard nodes and seed nodes becoming more decentralized too, Zilliqa qualifies for the label of decentralized in my opinion.
 
Smart contracts
 
Let me start by saying I’m not a developer and my programming skills are quite limited. So I‘m taking the ELI5 route (maybe 12) but if you are familiar with Javascript, Solidity or specifically OCaml please head straight to Scilla - read the docs to get a good initial grasp of how Zilliqa’s smart contract language Scilla works and if you ask yourself “why another programming language?” check this article. And if you want to play around with some sample contracts in an IDE click here. The faucet can be found here. And more information on architecture, dapp development and API can be found on the Developer Portal.
If you are more into listening and watching: check this recent webinar explaining Zilliqa and Scilla. Link is time-stamped so you’ll start right away with a platform introduction, roadmap 2020 and afterwards a proper Scilla introduction.
 
Generalized: programming languages can be divided into being ‘object-oriented’ or ‘functional’. Here is an ELI5 given by software development academy: * “all programs have two basic components, data – what the program knows – and behavior – what the program can do with that data. So object-oriented programming states that combining data and related behaviors in one place, is called “object”, which makes it easier to understand how a particular program works. On the other hand, functional programming argues that data and behavior are different things and should be separated to ensure their clarity.” *
 
Scilla is on the functional side and shares similarities with OCaml: OCaml is a general-purpose programming language with an emphasis on expressiveness and safety. It has an advanced type system that helps catch your mistakes without getting in your way. It's used in environments where a single mistake can cost millions and speed matters, is supported by an active community, and has a rich set of libraries and development tools. For all its power, OCaml is also pretty simple, which is one reason it's often used as a teaching language.
 
Scilla is blockchain agnostic, can be implemented onto other blockchains as well, is recognized by academics and won a so-called Distinguished Artifact Award award at the end of last year.
 
One of the reasons why the Zilliqa team decided to create their own programming language focused on preventing smart contract vulnerabilities is that adding logic on a blockchain, programming, means that you cannot afford to make mistakes. Otherwise, it could cost you. It’s all great and fun blockchains being immutable but updating your code because you found a bug isn’t the same as with a regular web application for example. And with smart contracts, it inherently involves cryptocurrencies in some form thus value.
 
Another difference with programming languages on a blockchain is gas. Every transaction you do on a smart contract platform like Zilliqa or Ethereum costs gas. With gas you basically pay for computational costs. Sending a ZIL from address A to address B costs 0.001 ZIL currently. Smart contracts are more complex, often involve various functions and require more gas (if gas is a new concept click here ).
 
So with Scilla, similar to Solidity, you need to make sure that “every function in your smart contract will run as expected without hitting gas limits. An improper resource analysis may lead to situations where funds may get stuck simply because a part of the smart contract code cannot be executed due to gas limits. Such constraints are not present in traditional software systems”. Scilla design story part 1
 
Some examples of smart contract issues you’d want to avoid are: leaking funds, ‘unexpected changes to critical state variables’ (example: someone other than you setting his or her address as the owner of the smart contract after creation) or simply killing a contract.
 
Scilla also allows for formal verification. Wikipedia to the rescue: In the context of hardware and software systems, formal verification is the act of proving or disproving the correctness of intended algorithms underlying a system with respect to a certain formal specification or property, using formal methods of mathematics.
 
Formal verification can be helpful in proving the correctness of systems such as: cryptographic protocols, combinational circuits, digital circuits with internal memory, and software expressed as source code.
 
Scilla is being developed hand-in-hand with formalization of its semantics and its embedding into the Coq proof assistant — a state-of-the art tool for mechanized proofs about properties of programs.”
 
Simply put, with Scilla and accompanying tooling developers can be mathematically sure and proof that the smart contract they’ve written does what he or she intends it to do.
 
Smart contract on a sharded environment and state sharding
 
There is one more topic I’d like to touch on: smart contract execution in a sharded environment (and what is the effect of state sharding). This is a complex topic. I’m not able to explain it any easier than what is posted here. But I will try to compress the post into something easy to digest.
 
Earlier on we have established that Zilliqa can process transactions in parallel due to network sharding. This is where the linear scalability comes from. We can define simple transactions: a transaction from address A to B (Category 1), a transaction where a user interacts with one smart contract (Category 2) and the most complex ones where triggering a transaction results in multiple smart contracts being involved (Category 3). The shards are able to process transactions on their own without interference of the other shards. With Category 1 transactions that is doable, with Category 2 transactions sometimes if that address is in the same shard as the smart contract but with Category 3 you definitely need communication between the shards. Solving that requires to make a set of communication rules the protocol needs to follow in order to process all transactions in a generalised fashion.
 
And this is where the downsides of state sharding comes in currently. All shards in Zilliqa have access to the complete state. Yes the state size (0.1 GB at the moment) grows and all of the nodes need to store it but it also means that they don’t need to shop around for information available on other shards. Requiring more communication and adding more complexity. Computer science knowledge and/or developer knowledge required links if you want to dig further: Scilla - language grammar Scilla - Foundations for Verifiable Decentralised Computations on a Blockchain Gas Accounting NUS x Zilliqa: Smart contract language workshop
 
Easier to follow links on programming Scilla https://learnscilla.com/home Ivan on Tech
 
Roadmap / Zilliqa 2.0
 
There is no strict defined roadmap but here are topics being worked on. And via the Zilliqa website there is also more information on the projects they are working on.
 
Business & Partnerships
 
It’s not only technology in which Zilliqa seems to be excelling as their ecosystem has been expanding and starting to grow rapidly. The project is on a mission to provide OpenFinance (OpFi) to the world and Singapore is the right place to be due to its progressive regulations and futuristic thinking. Singapore has taken a proactive approach towards cryptocurrencies by introducing the Payment Services Act 2019 (PS Act). Among other things, the PS Act will regulate intermediaries dealing with certain cryptocurrencies, with a particular focus on consumer protection and anti-money laundering. It will also provide a stable regulatory licensing and operating framework for cryptocurrency entities, effectively covering all crypto businesses and exchanges based in Singapore. According to PWC 82% of the surveyed executives in Singapore reported blockchain initiatives underway and 13% of them have already brought the initiatives live to the market. There is also an increasing list of organizations that are starting to provide digital payment services. Moreover, Singaporean blockchain developers Building Cities Beyond has recently created an innovation $15 million grant to encourage development on its ecosystem. This all suggests that Singapore tries to position itself as (one of) the leading blockchain hubs in the world.
 
Zilliqa seems to already take advantage of this and recently helped launch Hg Exchange on their platform, together with financial institutions PhillipCapital, PrimePartners and Fundnel. Hg Exchange, which is now approved by the Monetary Authority of Singapore (MAS), uses smart contracts to represent digital assets. Through Hg Exchange financial institutions worldwide can use Zilliqa's safe-by-design smart contracts to enable the trading of private equities. For example, think of companies such as Grab, Airbnb, SpaceX that are not available for public trading right now. Hg Exchange will allow investors to buy shares of private companies & unicorns and capture their value before an IPO. Anquan, the main company behind Zilliqa, has also recently announced that they became a partner and shareholder in TEN31 Bank, which is a fully regulated bank allowing for tokenization of assets and is aiming to bridge the gap between conventional banking and the blockchain world. If STOs, the tokenization of assets, and equity trading will continue to increase, then Zilliqa’s public blockchain would be the ideal candidate due to its strategic positioning, partnerships, regulatory compliance and the technology that is being built on top of it.
 
What is also very encouraging is their focus on banking the un(der)banked. They are launching a stablecoin basket starting with XSGD. As many of you know, stablecoins are currently mostly used for trading. However, Zilliqa is actively trying to broaden the use case of stablecoins. I recommend everybody to read this text that Amrit Kumar wrote (one of the co-founders). These stablecoins will be integrated in the traditional markets and bridge the gap between the crypto world and the traditional world. This could potentially revolutionize and legitimise the crypto space if retailers and companies will for example start to use stablecoins for payments or remittances, instead of it solely being used for trading.
 
Zilliqa also released their DeFi strategic roadmap (dating November 2019) which seems to be aligning well with their OpFi strategy. A non-custodial DEX is coming to Zilliqa made by Switcheo which allows cross-chain trading (atomic swaps) between ETH, EOS and ZIL based tokens. They also signed a Memorandum of Understanding for a (soon to be announced) USD stablecoin. And as Zilliqa is all about regulations and being compliant, I’m speculating on it to be a regulated USD stablecoin. Furthermore, XSGD is already created and visible on block explorer and XIDR (Indonesian Stablecoin) is also coming soon via StraitsX. Here also an overview of the Tech Stack for Financial Applications from September 2019. Further quoting Amrit Kumar on this:
 
There are two basic building blocks in DeFi/OpFi though: 1) stablecoins as you need a non-volatile currency to get access to this market and 2) a dex to be able to trade all these financial assets. The rest are built on top of these blocks.
 
So far, together with our partners and community, we have worked on developing these building blocks with XSGD as a stablecoin. We are working on bringing a USD-backed stablecoin as well. We will soon have a decentralised exchange developed by Switcheo. And with HGX going live, we are also venturing into the tokenization space. More to come in the future.”
 
Additionally, they also have this ZILHive initiative that injects capital into projects. There have been already 6 waves of various teams working on infrastructure, innovation and research, and they are not from ASEAN or Singapore only but global: see Grantees breakdown by country. Over 60 project teams from over 20 countries have contributed to Zilliqa's ecosystem. This includes individuals and teams developing wallets, explorers, developer toolkits, smart contract testing frameworks, dapps, etc. As some of you may know, Unstoppable Domains (UD) blew up when they launched on Zilliqa. UD aims to replace cryptocurrency addresses with a human-readable name and allows for uncensorable websites. Zilliqa will probably be the only one able to handle all these transactions onchain due to ability to scale and its resulting low fees which is why the UD team launched this on Zilliqa in the first place. Furthermore, Zilliqa also has a strong emphasis on security, compliance, and privacy, which is why they partnered with companies like Elliptic, ChainSecurity (part of PwC Switzerland), and Incognito. Their sister company Aqilliz (Zilliqa spelled backwards) focuses on revolutionizing the digital advertising space and is doing interesting things like using Zilliqa to track outdoor digital ads with companies like Foodpanda.
 
Zilliqa is listed on nearly all major exchanges, having several different fiat-gateways and recently have been added to Binance’s margin trading and futures trading with really good volume. They also have a very impressive team with good credentials and experience. They don't just have “tech people”. They have a mix of tech people, business people, marketeers, scientists, and more. Naturally, it's good to have a mix of people with different skill sets if you work in the crypto space.
 
Marketing & Community
 
Zilliqa has a very strong community. If you just follow their Twitter their engagement is much higher for a coin that has approximately 80k followers. They also have been ‘coin of the day’ by LunarCrush many times. LunarCrush tracks real-time cryptocurrency value and social data. According to their data, it seems Zilliqa has a more fundamental and deeper understanding of marketing and community engagement than almost all other coins. While almost all coins have been a bit frozen in the last months, Zilliqa seems to be on its own bull run. It was somewhere in the 100s a few months ago and is currently ranked #46 on CoinGecko. Their official Telegram also has over 20k people and is very active, and their community channel which is over 7k now is more active and larger than many other official channels. Their local communities also seem to be growing.
 
Moreover, their community started ‘Zillacracy’ together with the Zilliqa core team ( see www.zillacracy.com ). It’s a community-run initiative where people from all over the world are now helping with marketing and development on Zilliqa. Since its launch in February 2020 they have been doing a lot and will also run their own non-custodial seed node for staking. This seed node will also allow them to start generating revenue for them to become a self sustaining entity that could potentially scale up to become a decentralized company working in parallel with the Zilliqa core team. Comparing it to all the other smart contract platforms (e.g. Cardano, EOS, Tezos etc.) they don't seem to have started a similar initiative (correct me if I’m wrong though). This suggests in my opinion that these other smart contract platforms do not fully understand how to utilize the ‘power of the community’. This is something you cannot ‘buy with money’ and gives many projects in the space a disadvantage.
 
Zilliqa also released two social products called SocialPay and Zeeves. SocialPay allows users to earn ZILs while tweeting with a specific hashtag. They have recently used it in partnership with the Singapore Red Cross for a marketing campaign after their initial pilot program. It seems like a very valuable social product with a good use case. I can see a lot of traditional companies entering the space through this product, which they seem to suggest will happen. Tokenizing hashtags with smart contracts to get network effect is a very smart and innovative idea.
 
Regarding Zeeves, this is a tipping bot for Telegram. They already have 1000s of signups and they plan to keep upgrading it for more and more people to use it (e.g. they recently have added a quiz features). They also use it during AMAs to reward people in real-time. It’s a very smart approach to grow their communities and get familiar with ZIL. I can see this becoming very big on Telegram. This tool suggests, again, that the Zilliqa team has a deeper understanding of what the crypto space and community needs and is good at finding the right innovative tools to grow and scale.
 
To be honest, I haven’t covered everything (i’m also reaching the character limited haha). So many updates happening lately that it's hard to keep up, such as the International Monetary Fund mentioning Zilliqa in their report, custodial and non-custodial Staking, Binance Margin, Futures, Widget, entering the Indian market, and more. The Head of Marketing Colin Miles has also released this as an overview of what is coming next. And last but not least, Vitalik Buterin has been mentioning Zilliqa lately acknowledging Zilliqa and mentioning that both projects have a lot of room to grow. There is much more info of course and a good part of it has been served to you on a silver platter. I invite you to continue researching by yourself :-) And if you have any comments or questions please post here!
submitted by haveyouheardaboutit to CryptoCurrency [link] [comments]

A series of 51% attacks puts Ethereum Classic’s security into question

A series of 51% attacks puts Ethereum Classic’s security into question
An adversary performed a successful 51% attack on the Ethereum Classic (ETC) network between July 31 and August 1. The hacker was able to steal around $5.6 million worth of ETC from the OKEx crypto exchange, according to Bitquery.
Later, on August 6, the attacker used the same scheme to double-spend an additional $1.68 million worth of ETC. This time the targets were Bitfinex and another unidentified crypto service.
The necessary hash power for these double-spend attacks was rented on cloud mining marketplace NiceHash — which was also used during a recent 51% attack attempt on Bitcoin Gold (BTG). The team behind BTG mitigated the attack by asking miners to follow the so-called “honest” chain instead of the longest one, basically censoring attacker’s blocks.
Such controversial measures, however, would be against Ethereum Classic’s core principles of decentralization and censorship-resistance, so it’s unclear how the community is planning to deal with similar attacks in the future. Meanwhile, US-based crypto exchange Coinbase increased the confirmation time for ETC deposits to roughly 2 weeks.
The second 51% attack on ETC didn’t have any significant impact on its price, though. One of the reasons for such a small market change, among other things, is that 10% of all ETC supply is held in a regulated trust run by Grayscale Investments, which also funds the development of Ethereum Classic, according to CoinDesk. Both Grayscale and CoinDesk are subsidiaries of American venture capital company Digital Currency Group (DCG) founded by Barry Silbert, a long-time supporter of ETC.
Given the very low cost of a 51% attack against ETC, Vitalik Buterin suggested that switching to a proof-of-stake consensus algorithm would be a lower-risk strategy for Ethereum Classic, than using a proof-of-work algorithm. Ethereum Classic originated in 2016 as a hard fork of Ethereum, when the latter’s community made a controversial decision to reverse the DAO hack, which sparked discussions about network’s censorship-resistance.
submitted by Crypto-Angel to EthereumClassic [link] [comments]

How does cryptocurrency works?

How does cryptocurrency works?
When we were a much smaller society, people could trade in the community pretty easily, but as the distance in our trade grew, we ended up inventing institutions such as banks, markets, stocks etc. that help us to conduct financial transactions. The currencies we are operating with nowadays are bills or coins, controlled by a centralized authority and tracked by previously mentioned financial institutions. The thing is, having a third party in our money transactions is not always what we wish for. But fortunately, today we have a tool that allows us to make fast and save financial transactions without any middlemen, it has no central authority and it is regulated by math. Sounds cool, right? Cryptocurrency is this tool. It is quite a peculiar system, so let’s take a closer look at it.
by StealthEX

Layers of a crypto-cake

Layer 1: Blockchain

First of all – any cryptocurrency is based on the blockchain. In simple words, blockchain is a kind of a database. It stores information in batches, called blocks that are linked together in a chronological way. As the blockchain is not located in one place but rather on thousands of computers around the globe, the blockchain and the transactions thus are decentralized, they have no head center. The newest blocks of transaction are continuously added on (or changed) to all the previous blocks. That’s how you get a cryptocurrency blockchain.
The technology’s name is a compound of the words “block” and “chain”, as the “blocks” of information are linked together in a “chain”. That’s how crypto security works – the information in the recently created block depends on the previous one. It means that no block can be changed without affecting the others, this system prevents a blockchain from being hacked.
There are 2 kinds of blockchain: private and public. Public, as goes by its name, is publicly available blockchain, whereas private blockchain is permissioned, which only a limited number of people have access to.

Layer 2: Transaction

In fact, everything begins with the intention of someone to complete a transaction. A transaction itself is a file that consists of the sender’s and recipient’s public keys (wallet addresses) and the amount of coins transferred. The sender begins by logging in into his cryptocurrency wallet with the private key – a unique combination of letters and numbers, something you would call a personal password in a bank. Now the transaction is signed and the first step which is called basic public key cryptography is completed.
Then the signed (encrypted) transaction is shared with everyone in the cryptocurrency network, meaning it gets to every other peer. We should mention that the transaction is firstly queued up to be added to the public ledger. Then, when it’s broadcasted to the public ledger, all the computers add a new transaction to a shared list of recent transactions, known as blocks.
Having a ledger forces everyone to “play fair” and reduce the risk of spending extra. The numbers of transactions are publicly available, but the information about senders and receivers is encrypted. Each transaction holds on to a unique set of keys. Whoever owns a set of keys, owns the amount of cryptocurrency associated with those keys (just like whoever owns a bank account owns the money in it). This is how peer-to-peer technology works.

Layer 3: Mining

Now let’s talk about mining. Once confirmed, the transaction is forever captured into the blockchain history**.** The verification of the block is done by Cryptocurrency Miners – they verify and then add blocks to the public ledger. To verify them, miners go down on the road of solving a very difficult math puzzle using powerful software, which is that the computer needs to produce the correct sequence number – “hash” – that is specific to the given block, there is not much chance of finding it. Whoever solves the puzzle first, gets the opportunity to officially add a block of transactions to the ledger and get fresh and new coins as reward. The reward is given in whatever cryptocurrency’s blockchain miners are operating into. For example, BTC originally used to reward miners in 50 BTC, but after the first halving it decreased to 25 BTC, and at present time it is 6.25 BTC. The process of miners competing against each other in order to complete the transactions on the network and get rewarded is known as the Proof-of-Work (PoW) algorithm, which is natural for BTC and many other cryptocurrencies. Also there are another consensus mechanisms: Proof-of-Stake (PoS), Delegated Proof-of-Stake (dPoS), Proof-of-Authority (PoA), Byzantine Fault Tolerance (BFT), Practical Byzantine Fault Tolerance (pBFT), Federated Byzantine Agreement (FBA) and Delegated Byzantine Fault Tolerance (dBFT). Still, all of them are used to facilitate an agreement between network participants.
The way that system works – when many computers try to verify a block – guarantees that no computer is going to monopolize a cryptocurrency market. To ensure the competition stays fair, the puzzle becomes harder as more computers join in. Summing it up, let’s say that mining is responsible for two aspects of the crypto mechanism: producing the proof and allowing more coins to enter circulation.

Types of cryptocurrency

In the virtual currency world there are a bunch of different cryptocurrency types with their own distinctive features.
The first cryptocurrency is, of course, Bitcoin. Bitcoin is the first crypto coin ever created and used. BTC is the most liquid cryptocurrency in the market and has the highest market cap among all the cryptocurrencies.

Altcoins

The term ‘altcoins’ means ‘alternatives’ of Bitcoin. The first altcoin Namecoin was created in 2011 and later on hundreds of them appeared in crypto-world, among them are Ravencoin, Dogecoin, Litecoin, Syscoin etc. Altcoins were initially launched with a purpose to overcome Bitcoin’s weak points and become upgraded substitutes of Bitcoin. Altcoins usually stand an independent blockchain and have their own miners and wallets. Some altcoins actually have boosted features yet none of them gained popularity akin to Bitcoin. More about altcoins in our article.

Tokens

Token is a unit of account that is used to represent the digital balance of an asset. Basically tokens represent an asset or utility that usually are made on another blockchain. Tokens are registered in a database based on blockchain technology, and they are accessed through special applications using electronic signature schemes.
Tokens and cryptocurrencies are not the same thing. Let’s explain it more detailed:
• First of all, unlike cryptocurrencies, tokens can be issued and managed both centralized and decentralized.
• The verification of the token transactions can be conducted both centralized and decentralized, when cryptocurrencies’ verification is only decentralized.
• Tokens do not necessarily run their own blockchain, but for cryptocurrencies having their own blockchain is compulsory.
• Tokens’ prices can be affected by a vast range of factors such as demand and supply, tokens’ additional emission, or binding to other assets. On the other hand, the price of cryptocurrencies is completely regulated by the market.
Tokens can be:
• Utility tokens – something that accesses a user to a product or service and support dApps built on the blockchain.
• Governance tokens – fuel for voting systems executed on the blockchain.
• Transactional tokens – serve as a unit of accounts and used for trading.
• Security tokens – represent legal ownership of an asset, can be used in addition to or in place of a password.
Tokens are usually created through smart contracts and are often adapted to an ICO – initial coin offering, which is a means of crowdfunding. It is much easier to create tokens, that is why they make a majority of coins in existence. Altcoin and token blockchains work on the concept of smart contracts or decentralized applications, where the programmable, self-executing code is ruling the transactions within a blockchain. By the way, the vast majority of tokens were distributed on the Ethereum platform.

Forks

Generally a fork occurs when a protocol code, on which the blockchain is operating, is being changed, modified and updated by developers or users. Due to the changes, the blockchain splits into 2 paths: an old way of doing things and a new way. These changes may happen because: a disagreement between users and creators; a major hack, as it was with Ethereum; developers’ decision to fix errors and add new functionality. The blockchain mainly splits into hard forks and soft forks. Shortly speaking, coin hard forks cannot work with older versions while soft forks still can work with older versions.
Hard fork – after a hard fork, a new version is completely separated from the previous one, there’s no connection between them anymore, although the new version keeps the data of all the previous transactions but now on, each version will have its own transaction history. In order to use the new versions, every node has to upgrade their software. A hard fork requires majority support (or consensus) from coin holders with a connection to the coin network. If enough users don’t update then you will be unable to get a clean upgrade which could lead to a break in the blockchain.
Soft fork – a protocol change, but with backward compatibility. The rules of the network have been changed, but nodes running the old software will still be able to validate transactions, but those updated nodes won’t be able to mine new blocks. So to be used and useful, soft forks require the majority of the network’s hash power. Otherwise, they risk becoming set out and anyway ending up as a hard fork.

Stablecoins

As it comes from the name, stablecoins are price-stabilized that are becoming big in the crypto world. Still enjoying most of the “typical-cryptocurrency” benefits, it is standing out as a fixed and stable coin, not volatile at all. Stablecoins’ values are stabilized by pegging them to other assets such as the US Dollar or gold.
Stablecoins include Tether (USDT), Standard (PAX), Gemini Dollar (GUSD) which are backed by the US Dollar and approved by the New York State Department of Financial Services.

Conclusion

Now that we hacked into cryptocurrency, you probably understand that it is much less mysterious than it first seemed. Nowadays, cryptocurrencies are making the revolution of the financial institution. For example, Bitcoin is currently used in 96 countries and growing, with more than 12,000 transactions per hour. More and more investors are involved, banks and governments realize that these cutting edge technologies are prone to draw their control away. Cryptocurrencies are slowly changing the world and you can choose – either stand beside and observe or become part of history in the making.
And remember if you need to exchange your coins StealthEX is here for you. We provide a selection of more than 300 coins and constantly updating the cryptocurrency list so that our customers will find a suitable option. Our service does not require registration and allows you to remain anonymous. Why don’t you check it out? Just go to StealthEX and follow these easy steps:
✔ Choose the pair and the amount for your exchange. For example BTC to ETH.
✔ Press the “Start exchange” button.
✔ Provide the recipient address to which the coins will be transferred.
✔ Move your cryptocurrency for the exchange.
✔ Receive your coins.
Follow us on Medium, Twitter, Facebook, and Reddit to get StealthEX.io updates and the latest news about the crypto world. For all requests message us via [[email protected]](mailto:[email protected]).
The views and opinions expressed here are solely those of the author. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Original article was posted on https://stealthex.io/blog/2020/09/29/how-does-cryptocurrency-works/
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Building a Mini POS (Proof of Stake) Mining Box. Biostar A68N-5600 ITX Part 2 Proof Of Work & Proof Of Stake  Hindi Bitcoin Q&A: Proof-of-Work (PoW), Proof-of-Stake (PoS ... Bitcoin Tutorial #9 - Proof of Work - Mining PosWallet Cloud Mining PoS (Proof of Stake) cryptocurrency. review!

Mining rigs in a bitcoin mining facility. Proof of Stake. Unlike the proof of work system, in which the user validates transactions and creates new blocks by performing a certain amount of computational work, a proof of stake system requires the user to show ownership of a certain number of cryptocurrency units. Under proof-of-stake, the network secures itself through the commitment of a stake — a certain amount of capital in the form of the network’s own tokens. Its security is meant to be derived directly from the perceived economic value of the network — how expensive it is to purchase a majority stake. Bitcoin Proof of Stake: A Peer-to-Peer Electronic Cash System Bitcoin PoS Developers [email protected] www.bitcoinpos.net 1. Introduction Bitcoin Proof of Stake (Bitcoin PoS - BPS) is the world’s first integration of cryptocurrency’s two foremost technological achievements — Bitcoin, and proof of stake consensus. This process requires both a proof-of-stake miner and a masternode. Each time a new block is generated, 15% of the block reward goes to the proof-of-stake miner, and 85% goes to the masternode. Proof of stake(PoS) is a method of securing a cryptocurrency network through requesting users to show ownership of a certain amount of currency. It is different from proof-of-work systems that run hashing algorithms to validate electronic transactions. It is most commonly used as a supplement to proof-of-work in Peercoin and a few other electronic currencies.

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Building a Mini POS (Proof of Stake) Mining Box. Biostar A68N-5600 ITX Part 2

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