Apr 2, 2016 - The key difference between Nxt and many other .... one key is required to authorize a transaction. A mul-
The SuperNET team is working on a wide range of technical solutions that make it easier to use digital currencies and blockchain technologies. SuperNET, and the Iguana platform on which it runs, functions as a middleware for other blockchains by giving developers and users access to the best innovation from one place: the SuperNET client. Modular design and open source code allows anyone to build their own applications on top of the technology. The goal is to boost cooperation between different blockchain projects and bring positive change to the world through universally available and decentralized technological innovations.
“Nxt is an advanced blockchain platform which builds on and improves the basic functionality of pioneering cryptocurrencies such as Bitcoin. Cryptocurrency and financial systems are the first widely used applications of blockchain technology, but the blockchain and its associated technology can be used for so much more. Nxt revolutionises the financial technology, crowdfunding and governance industries by providing not only the groundbreaking NXT crypto-currency, but also a powerful, modular toolset to build with in any way Nxt users can imagine. Nxt gives users complete freedom to create their own applications.” Source: https://nxt.org/
About This report, which was produced by Digital Catallaxy, can be freely distributed. It is intended not only for existing cryptocurrency investors but also for those who are new to digital currencies and blockchain technologies and want to learn more. The report was financed by SuperNET founder and lead developer James Lee. Contributors Audo Kryptowitz Robert Bold Proto qq2536007339 Dave Pearce Noashh
Designer, content creator Editor, content creator Proofreading Nxt blockchain statistics Reviewer of Nxt sections Reviewer of SuperNET sections
Disclaimer The content of this Annual Report is for general information and news purposes only. It does not take into account readers’ personal circumstances (including financial situation) or investment objectives. As with any investment, readers should be aware that they might lose all their money and should therefore carry out and rely exclusively on their own due diligence research before making (or refraining from making) any investment decision.
Partners Digital Catallaxy has two major partners who share the same goals and values, and who have helped to put this report together. CORE Media is committed to removing the gap between people and these new blockchain based digital tools. Their mission is to provide genuine information to people on all aspects of their lives – even beyond digital currencies.
NXTER.ORG is a project run by Nxters to inform and inspire people all around the world about Nxt. The project primarily comprises a magazine and news hub focused on crypto-investments and services, supported by writers and translators contributing in 10 different languages.
Preface This report, which was written with a nontechnical audience in mind, describes some things that I feel are hidden gems among digital currencies. These gems are sure to inspire and amaze those who come across them for the first time (as they did me) and then, like all groundbreaking essential innovations, eventually become taken for granted by everyone as if they had always existed. However whilst these technologies and visions show great promise they are, like everything in the crypto space, still young and partly unfinished products. Nevertheless, once you understand the full scope of their respective goals it becomes clear that they each have the po-
tential to become something huge. Just like Bitcoin did, so too could these technologies suddenly burst into view one day and take everyone by surprise. First and foremost I want to thank the the Nxt and SuperNET communities, of which I have been a member for some time now. Having an active, hands-on community is absolutely essential for any project to succeed; indeed, without it, this report would not exist, nor of course have any reason to exist. I also want to thank James Lee who provided the necessary funding to make this report possible and the editors, Proto and Robert Bold (who also contributed a substantial amount of additional content).
Huge thanks to Dave Pearce as well for providing a review along with extra content regarding NXT and its legal status. I am proud to be part of this inspiring, genuine, and friendly community that is full of brilliant and hard-working people. I hope this, the first Nxt and SuperNET Annual Report, will help us move forward in 2016 and that many more people will come and join us.
Audo Kryptowitz Designer, community member 2 April 2016
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Table of Contents Introduction
Community
From Printing Press to Digital Property............................................................ 9 Where are we heading.......................................................................................15
The world does not rest on one man's shoulders............................................. 87 A Chance of A Lifetime.......................................................................................90 How Things Get Done........................................................................................91 Our Support Grid................................................................................................93
Technology Blockchain as a Public Good.............................................................................. 19 Digital Services...................................................................................................25 Nxt and the Law................................................................................................. 30 Importance of Financial Privacy........................................................................ 38 The Middleware of Blockchains........................................................................ 45 SuperNET Core Coins......................................................................................... 52
Dividends in 2015 BGCAFFE.............................................................................................................97 Coinomat.com....................................................................................................98 CORE................................................................................................................... 99 E9........................................................................................................................ 100 MMNXT..............................................................................................................101 LIQUID................................................................................................................ 102 MMBTCD............................................................................................................ 103 NXTER.org..........................................................................................................104 SIGWONET.........................................................................................................105
Ecosystem Business-to-Business Service Provision............................................................ 59 Jl777 Interview....................................................................................................61 InstantDEX......................................................................................................... 64 Pangea................................................................................................................ 68 SkyNET................................................................................................................72 SuperNET Dividend Flows.................................................................................76 Coinomat Interview........................................................................................... 81 CryptoFund.........................................................................................................83 BitFirm................................................................................................................ 84 ForkPay............................................................................................................... 85
Addendum
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Introduction What it is all about
Decentralization
Centralization
“The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design. To the naive mind that can conceive of order only as the product of deliberate arrangement, it may seem absurd that in complex conditions order, and adaptation to the unknown, can be achieved more effectively by decentralizing decisions and that a division of authority will actually extend the possibility of overall order. Yet that decentralization actually leads to more information being taken into account.” — Friedrick Hayek
“The freer an economy is, the more this human diversity of knowledge will be manifested. By contrast, political power originates in top-down processes–governments, monopolies, regulators, and elite institutions–all attempting to quell human diversity and impose order. Thus power always seeks centralization.” — George Gilder
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How it Began “A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required to prevent double-spending. We propose a solution to the double-spending problem using a peer-to-peer network. The network timestamps transactions by hashing them into an ongoing chain of hash-based proof-of-work, forming a record that cannot be changed without redoing the proof-of-work. The longest chain not only serves as proof of the sequence of events witnessed, but proof that it came from the largest pool of CPU power. As long as a majority of CPU power is controlled by nodes that are not cooperating to attack the network, they'll generate the longest chain and outpace attackers. The network itself requires minimal structure. Messages are broadcast on a best effort basis, and nodes can leave and rejoin the network at will, accepting the longest proof-of-work chain as proof of what happened while they were gone.” — Satoshi Nakamoto in Bitcoin white paper
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From Printing Press to Digital Property
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he often quoted observation of a 19th century British politician, that “Power tends to corrupt, and absolute power corrupts absolutely” needs updating for the Internet age. Today, it is surely more meaningful to say: “Centralised power corrupts; decentralised power liberates.” The exercise of centralized power was originally made necessary because of the need for effective administration of the increasingly populous and complex societies that gradually developed following the introduction of agriculture some 12,000 years ago.
Centralized power is the ability vested in the few to direct the behaviour of the many. Such ability being secured either directly through force of arms, belief in divine ordination, time-honoured tradition electoral success or indirectly through being delegated. Unfortunately, human nature being what it is, anyone vested with centralized power (by whatever means) is liable to be corrupted by it, no matter how many checks and balances and other forms or accountability they are subject to. Information is of course the key to accountability which is why the control of in-
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formation, including its suppression, has always gone hand in hand with the exercise of centralized power. However, since the Middle Ages the control of information has become progressively more difficult to enforce; in particular following the invention of the printing press, the gradual spread of mass literacy, the rise of the middle classes and the (re)discovery of scientific methods of learning and inquiry (based on humanism and empirical evidence) made possible by the Renaissance which, in turn, helped to create the conditions for the Industrial Revolution. Today it is difficult to know exactly who or what the ultimate holders of centralized
How Fiat Money Is Created power are. Arguably, given the increasing hollowing out of representative democracy, it's the unelected and unaccountable international and global institutions which most people either don't even know exist or, if they do, have no idea what their function is; for example, to name but a few, the ‘four pillars’ of global economic governance (the International Monetary Fund, the World Bank, the World Trade Organization, the Financial Stability Board of the G20) the Bank for International Settlement and the European Commission. What is certain though is that centralized power is underpinned by the debt-based monetary systems used throughout the world and run, in effect, by private, commercial banks which, by virtue of their virtual monopoly over domestic credit creation, create most of the money circulating in the world's economies – as much as 97% - and determine its allocation, disproportionately for consumptive and speculative (as opposed to productive) purposes, thereby expanding the debt-driven FIRE economy, at the expense of the real (productive) part of the economy, and further
enriching a wealthy elite. Information continues of course to be a hugely valuable resource and although in the popular imagination the Internet is seen as having finally liberated the use of that resource from the control of centralized power and its gatekeepers the reality is more complicated, as shown in particular by the Snowden revelations about mass surveillance and the inconvenient fact that: “...the global machinery of the internet is operated by a conglomerate dominated by governments – and especially the US government.” (Matthew Sparkes, Daily Telegraph). Nevertheless, despite the continuing best efforts of the holders of centralized power and their gatekeepers to maintain their monopoly control, cracks in the gate are, thanks to information technology, beginning to appear and with it the hope that real freedom may yet one day spread around the world. Digitization has given rise to countless innovations. However, so far there are only three really worth mentioning, all of them radical and disruptive and each of which has set in motion a ripple effect that will shape the world for many decades to
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“In the modern economy, most money takes the form of bank deposits. But how those bank deposits are created is often misunderstood: the principal way is through commercial banks making loans. Whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money.” — Bank of England in its Quarterly Bulletin (Q1, 2014)
FIRE Economy “The FIRE Economy [including finance, insurance and real estate] operates by extracting economic rents, such as interest on debt, from the rest of the economy. …The total sum of payments within the FIRE Economy are now many times larger than in the Productive Economy.”
Disruptive Innovation A disruptive innovation is an innovation that creates a new market that eventually disrupts and displaces the previously established market leaders and alliances. Businesses that do not adapt in time will face devastating consequences.
Blockchain come. What these technologies have in common is their way of automizing operations. They are robust and decentralized systems with no single point of failure. No one is in charge of them nor can they be shut down. They are global and borderless systems that bring people and businesses closer together. The Internet was the first one. It is a global public space potentially free of any form of centralized control. Meanwhile, for the first time ever, people can be in direct communication with each other without a central hub. Even if you take down some of the servers, the information will route through different ones, ultimately reaching its destination. This allows the free flow of ideas, information and data. The next breakthrough was the digitization of cryptography, which guarantees secure communication between people. The other, more recent, invention is the blockchain. Just as the Internet is doing, it will help to increase the wealth and liberty of millions, eventually billions, of people around the world. While the Internet is
about sending information, the blockchain is about turning information into digital property. It is truly a revolutionary technology that allows people to do things that were not possible before. Fundamentally, it will enable people to communicate and transact business together without them having to trust each other or needing to use a third party to acting as intermediary or final decision maker. Trust has been decentralized. Eventually this technology will disintermediate (i.e. remove third parties from) any process that can be digitalized. It will help individuals to collaborate, organize horizontally, become financially independent. One thing leads to another as there would be no blockchain without cryptography, no Internet without the transistor, no transistor without the steam engine and probably no progress at all, or only very limited progress, without the dissemination of ideas, originally made more effective by the printing press and now by the blockchain - exponentially enhancing the creative capacity of the human mind.
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A blockchain is a public ledger of all transactions that have ever been executed. Thus the latest version of blockchain contains all the data needed to determine where all the tokens are located. Other computers (or nodes) around the world come into consensus that a token has been transferred. Every participant has to follow the same rules as the majority of the nodes. The rules can be changed only if someone gets over 50 % of the network under their control. The blockchain is therefore a tool for achieving decentralized consensus, maintaining a decentralized ledger, and distributing data between peers in a trustless and verifiable manner.
Token A token can be transferred by writing a new transaction into the blockchain. Every address has a password which is needed to create a transaction. If the password is lost, the tokens can never be moved again. Tokens are also known as 'coins' or 'currency'. However to constitute 'money', properly so called, a token must be able to function not only as a medium of exchange (i.e. means of payment) and store of value but also as a unit of account (i.e. measure of value) and to function as that it would need to be accepted everywhere within the economy.
Bitcoin Adoption Graphics 2013 – 2015 LocalBitcoins.com is a way to buy bitcoins from someone in person. Another way is to use a bitcoin exchange where money is moved by means of a bank transfer. LocalBitcoins only represents a small fraction of the fiat to bitcoin exchange volume around the world, but is nevertheless a good indicator as to the rate of global adoption.
Weekly Bitcoin Exchange Volume, global
Weekly LocalBitcoins Volume, global
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Weekly LocalBitcoins Volume, by currency
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Bitcoin Wallet Growth in 2015
Number of Blockchain.info Bitcoin Wallets
Blockchain Searches (Google Trends)
Bitcoin Searches (Google Trends)
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Where are we heading
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hrough the Internet we have the ability to communicate without borders, find information and create virtual platforms of learning and entertainment. When we mix blockchain technology with existing platforms and ideas, we get new ground-breaking solutions that were not possible before. In the blockchain, data can be stored indefinitely, and its ownership can be transferred to the next person, its history and authenticity can be inspected, and it cannot be modified. Thus it can be used as money, but that's just the the beginning. It can also represent shares, property rights etc. or act as a key that is needed to use a service. We are going to see countless disruptive innovations in the fields of banking, finance, commerce, cloud storage, communications, social media, and cloud computing. Some of the most exciting ramifications are de-
centralized crowdfunding platforms, low to no cost micropayments, and an ability to create horizontally structured decentralized organizations. This technology will help small business become global. They can instantly plug into a global grid that offers real time communication, financial and banking tools, and business-to-business services. Through this technology anyone can get an edge against big established corporations. Individuals can store wealth, invest in start-ups and send payments around the world just as if they were chat messages. For businesses and entrepreneurs it creates a robust and independent ecosystem on a global scale without any restrictions. The blockchain is ideal for those who do not have access to traditional financial tools and banking services. Just as many countries jumped straight into wireless technology, they can now jump straight into blockchain-
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based technology. The old systems are not needed as this technology is stand-alone. Mass adoption could start in the developing world, where the technology is particularly needed. Saying that the old systems can compete would be like saying that traditional mail can compete with email. Even though blockchain technology has brought us a global and essentially free medium of exchange, very few have so far
used it. Most probably the mass adoption phase will be triggered by a service that can be delivered only through the blockchain. Such a service will lower the threshold to adopt other services, and it will increase the network effect of the whole ecosystem. The Internet (and the software on which it runs – the 'World Wide Web') has undoubtedly had a major impact on traditional types and ways of doing business
(rejuvenating some whilst consigning others to oblivion) and also on society more broadly. However the blockchain's impact on society and business will likely be much more profound and more quickly felt. "We should think about the blockchain as another class of thing like the Internet - a comprehensive information technology with tiered technical levels and multiple classes of applications for any form of asset
Crowdfunding
Network Effect
The use of small amounts of capital from a large number of individuals to finance a new business venture. Crowdfunding has the potential to increase entrepreneurship by expanding the pool of investors from whom funds can be raised, beyond the traditional circle of owners, relatives and venture capitalists.
A phenomenon whereby a good or service becomes more valuable when more people use it. The bigger the network, the more value it will create for the users. A good example is the telephone or Facebook.
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registry, inventory, and exchange including every area of finance, economics, money; hard assets (physical property) and intangible assets (votes, ideas, reputation, intention, health data, information, etc). (Melaine Swan, Institute for Blockchain Studies.)
Horizontal Organization A decentralized power structure within an association or business. A business that is structured as a flat or horizontal organization where power is shared more broadly tends to allow more staff more control over business matters according to their expertise. It is often supportive of considerable collaboration between employees.
Bitcoin Price CoinDesk's Bitcoin Price Index (BPI), 2015
CoinDesk's Bitcoin Price Index (BPI), 2010 - 2016
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Technology The code under the hood
Blockchain as a Public Good
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igital currencies and decentralized technologies are open source and free for anyone to use. Whether you are someone only interested in non-business use, a budding entrepreneur, or an already-established business, there is an ever-increasing range of services available to you, whether in the form of blockchain core features or third party services built on top of the blockchain. Nxt, the first exclusively Proof-of-Stake digital currency, is an independent, decentralized financial platform which, by virtue of its feature-rich, modular design and plug-in support for third party developers, enables the performance of a wide, and increasing, range of functions regarding financial value and does so far more effectively, securely and cost-efficiently than any fiat based competition. The Nxt platform can also, by virtue for example of its voting system being used for community decision-making and its Mon-
etary System being used to create currencies for local economies, help create and sustain human and social capital – essential forms of value upon which financial value of course ultimately depends. The Nxt platform's financial tools ensure that people have access to the equivalent of basic banking services essentially for free, thereby dispensing with the need to open a bank account. This is an especially important matter for many people living outside the Western world. If you are cut off from basic financial services, you cannot save, loan, or invest. These people, 'the unbanked', are thereby in effect prevented from ever being able to raise themselves out of poverty. The world is filled with creative and hard working people who are full of ideas. However, due to the difficulties involved in obtaining a conventional bank loan, especially for those without an existing business track record, only a very few are ever able to
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The Unbanked As of 2014, the estimated number of adults worldwide without a bank account was estimated at 2 billion (down from 2.5 billion in 2011). That represents 38 percent of the world’s adult population.
The Investment Model The Investment Model: Resembles a standard equity investment, where an individual receives equity in an entity in return for financing. There are two standard sub-categories of Investment Model crowdfunding: 1) Securities Investment Model – shares in the company are bought by investors. In this model, contributors would be buying ownership in the parent company or rights in a project. 2) Profit or Revenue-sharing Model – a share of the revenue or profits of the project is earned by investors, as opposed to shares in the underlying company. This is also known as a ‘Collective Investment Scheme’.
Nxt & NXT Nxt usually refers to the Nxt Platform and NXT to the currency/tokens used on the Nxt Platform. An illustrative example to demonstrate common usage would be, “Bob used his Nxt Client to transfer 100NXT to Alice”.
IPO and ICO “Initial Coin Offerings are a new type of crowdfunding that utilizes the block chain digital currency platform pioneered by Bitcoin. The objective is to raise capital via virtual assets that represent an idea, which are shared and/or traded on exchanges such as Bittrex. The value of the coins should reflect the idea’s success and provide coin owners a chance to profit off the person, group, or company behind the ICO and their ideas.“ By contrast the sale of a traditional stock is referred as an initial public offering (IPO), which is defined as the first sale of stock by a company to the public. A company can raise money by issuing either debt or equity. If the company has never issued equity to the public, it's known as an IPO.
develop their ideas into market-ready goods or services. The Nxt Asset exchange helps people to realize their business ideas much more easily. Having access to modern financial tools instantly without needing to demonstrate an existing business track record or put up any fiat capital of their own upfront is hugely important. The growing
keting company, and 'buongiorno caffe', a coffee shop located in South Africa. For an overview of some of the main legal implications involved in crowdfunding, see 'Nxt and The Law' on page 30 of this Report. The asset issuer sets the rules of the ICO by explaining what the asset token represents. The Nxt platform is still under heavy
There are already a couple of established 'bricks and mortar' businesses that have migrated to Nxt in order to show their support: 'Farla Webmedia', a web design and online marketing company, and 'buongiorno caffe', a coffee shop located in South Africa. Nxt ecosystem offers support in these and various other areas at a low cost. The current services for business are primarily concerned with raising capital and paying dividends. For existing fully-funded businesses therefore this platform may not have so much to offer, yet. However, there are already a couple of established 'bricks and mortar' businesses that have migrated to Nxt in order to show their support: 'Farla Webmedia', a web design and online mar-
development, with new features (core and third party) constantly being added. We are not talking about a platform that is only for business users. Nxt is building tools of administration in general. A notable feature is the ability to create different kinds of polls in which some defined segment of people can vote. A voting result achieved through the decentralized voting technology cannot be tampered with by an outside party. Such mathematically en-
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An Asset forced and provably fair voting can have multiple different use-cases. Currently, however, the Nxt voting system is totally transparent. That means everyone is able to see how others voted. A voting system used in political elections should offer total anonymity to the voters. Only through anonymity can the risk of coercion and vote buying be eliminated.
Privacy is important, including for businesses: in particular, transaction histories are commercially sensitive data which need to be kept private. To address this issue Nxt is developing private monetary transactions. In the meantime, Nxt already supports encrypted messaging. However, not all the burden of creating the necessary innovation has to rest on the shoulders of the Nxt developers. Third party developers are also actively involved in the process of producing the necessary innovative solutions to help ensure that the Nxt platform provides the widest range of tools possible. The key difference between Nxt and many other projects is that Nxt does not try to compete with Bitcoin. The 'NXT' token has not been designed primarily as a means of exchange, but rather as a token that can be used to unlock the platform's features. Bitcoin can be the money while Nxt is its financial platform.
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An asset is a token that is traded on the Nxt Asset Exchange. Assets are also known as coloured coins. They can represent almost anything, including: commodities (i.e. tradeable raw materials, e.g. copper, oil or silver and primary agricultural products, e.g. beef and coffee), shares of a company's profit or of a basket of assets, equity in a company, or even concepts.
Altcoin Altcoin means alternative digital currency launched after Bitcoin. Generally, altcoins present themselves as better substitutes to Bitcoin, since whose inception hundreds of altcoins have been launched.
Clone “A clone refers to a new crypto currency that copies the source code of an existing crypto, making only minimal changes.”
Mission (1) Give everyone access to easy-to-use, world class decentralized services that create, enhance and secure people's financial wealth and social capital. (2) Provide an open source framework on which third party developers can quickly and easily build their applications. Vision People power made a reality worldwide.
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NXT Blockchain Statistics Transactions by type
Transactions per day (all transaction types)
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Transactions by type
Empty blocks per day
New accounts per day
Daily NXT transaction volume
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Digital Services Features of the financial platform Nxt
N
XT was the first coin that was not a Bitcoin fork, but instead was built from scratch. Unlike Bitcoin, it has additional built-in features in its core, and thus it is called a second generation digital currency. Anyone can create a new account within minutes and get access to all of the Nxt platform's services. Accounts are secured with 12 word passphrases, which is the only thing that is needed to get access. After generating the account you will receive your public Nxt address. From your account you will have access to all the platform's features, including the asset exchange, monetary system, digital store, and messaging. Using the alias system you can tag the address with any name you want. Once the Nxt address and the alias have been tied together by making a permanent record on the blockchain, transactions can be made using the alias addresses, thus making ac-
count management even easier. Aliases can be transferred from account to account. The Nxt Monetary System has made it easy to create new currencies. Those currencies can be used, for example, as a parallel currency. Compared to the Asset Exchange, the Monetary System can be used for more advanced crowdfunding. In the Monetary System a specific goal has to
The current valuation of the Nxt Asset Exchange is $20 million. be met in order for the sale to be successful. If the sale doesn't reach its goal, the funds will be returned to those who funded it. Other Nxt core features include the Nxt Marketplace (formerly known as the Digital Goods Store), Arbitrary Messages, Voting
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Fork The term 'fork' in software development refers to 'project fork', which happens when developers take a copy of the source code from one software package and start independent development on it. The result is a new, distinct and separate piece of software.
Forging “Forging is the process by which nodes on the Nxt network bundle transactions into blocks, which are then added to the blockchain. This is similar to "mining" in other cryptocurrencies, except that there are no new coins given out as a block reward. The block reward for the forging account consists solely of transaction fees paid in the block.”
2nd generation digital currency A second generation digital currency, also referred as blockchain 2.0, has far greater utility than the first generation digital currencies. Some of the more advanced functionalities might be stealth addresses, smart contracts, side chains or assets.
Parallel currency and more recently Coin Shuffling (to improve account privacy), Account Control for phased transactions (the Nxt equivalent of multisignature), Account Properties (assigning arbitrary name/value metadata to user accounts) and Singleton Assets (useful for representing single tradeable objects). Arbitrary Messages features up to 1000 bytes of any data that can be sent and saved in the blockchain. See further the 'Most recent features' section on page 28 and also page 29.
nor can trading be halted. Buying and selling can therefore happen around the clock throughout the world. Often the business plan is published on nxtforum.org where anyone is free to comment on it. It may also be published on its own dedicated site or a third party site and indeed have received input and/or coverage from one or more of the services described in Business-to Business Service Provision on pages 59 and 60 of this Report. Those who hold the assets are referred to as 'asset holders' and they will automatically receive any dividends into their account. In order to pay dividends the asset issuer's profit, if not earned in the form of NXT, must first be exchanged with NXT (i.e. Nxt tokens). Once those tokens are on the asset issuer's account they can then be distributed with one click. The dividend payment and notification of it is sent to all asset holders instantaneously. Asset holders' lists, showing asset distribution, is publicly available. However, because Nxt addresses are not linked with legal names, asset issuers don't know who owns units in their assets. Using this platform people are therefore able to invest
Asset Exchange The current valuation of the Nxt Asset Exchange is $20 million. That's quite small in the grand scheme of things, but impressive considering that it's a totally decentralized platform and, moreover, one that is still in development and being marketed on a budget which is modest compared to those of some of its competitors. After an asset has been issued by an 'asset issuer', they put multiple units of it up for sale on the Asset Exchange. Once someone has bought units of an asset it will appear in their account's 'asset' section. The asset holdings cannot be frozen,
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A parallel currency (also known as a local or complementary currency) is a currency that is used alongside a national currency. Its purpose is to encourage spending within the local community, especially with locally owned businesses. Such currencies are often, but need not be, backed by fiat; 'backing' would involve an arrangement between the currency issuer and, for example, a bank or local authority to exchange the local currency for fiat, usually subject to an exchange fee. Nautiluscoin is a parallel currency that uses the Nxt Monetary System. Angistri, a small island located in Greece is its first test case. Drachmae Platform uses the Nautiluscoin to connect travelers with the local Greek tourism industry. It is an excellent way for tourists to help support the local economy and at the same time safeguard their purchasing power, since this technology is outside of the traditional banking system and thus not affected by the current Greek banking crisis.
Multisignature Multisignature refers to a system whereby more than one key is required to authorize a transaction. A multisignature address is an address that is associated with more than one private key or passphrase. The primary use case for it is to greatly increase the difficulty of stealing the coins.
their money pseudo-anonymously. The built-in messaging and voting tools enable the asset issuer to keep in communication with the asset holders. Although the blockchain dispenses with the need to trust the counterparty to perform his or her part of the agreement, it doesn't of course dispense with the need to carry out due diligence before investing. Nor does it diminish the role that can be played by trust. Thus, when a trusted community member launches a new promising business, all the asset units put up for sale might be sold in a day. However, community outsiders might have to spend a considerable amount of time and effort in order to gain the trust of investors. Through the procedures the community has set up, the amount of scams was significantly lower in 2015 than it was in 2014. MultiGateway In the digital economy there are hundreds of different digital currencies. The problem is that they don't speak to each other. You cannot send coin A through coin B's network. Rather, they are all independent platforms that compete with each other.
So far most of the other digital currencies (altcoins) have been advertising themselves as a new Bitcoin with better features, thus being in direct competition with Bitcoin. NXT is different, however, as Bitcoin can be integrated into its ecosystem via a service called Multigateway (MGW).
perBTC is 100% backed by real Bitcoins located in a multisignature wallet. The MGW service is a distributed solution which means that it is not yet fully decentralized. Currently there are three independent MGW servers that have to come into consensus to be able to send bit-
With MGW, other digital currencies can be sent through the Nxt platform. For example, you could send bitcoins from a regular bitcoin address to MGW and they will then automatically appear in your Nxt Account as SuperBTC. MGW is not part of the Nxt core, but rather it is built on top of Nxt. It has been developed by an independent third party. The technology behind it uses the Nxt messaging system to write information into the Nxt blockchain. With MGW, other digital currencies can be sent through the Nxt platform. For example, you can send bitcoins from a regular bitcoin address to MGW and they will then automatically appear in your Nxt Account as SuperBTC. SuperBTC is an asset that represents the value of one Bitcoin. Every Su-
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coins to another address. The service is automatic, so no human intervention is required. Since the MGW service is not fully decentralized it does carry some counterparty risk. However the risks are considered quite small by the community, who actively use the service to buy and sell Bitcoins. The trading that happens through Nxt Asset Exchange is totally decentralized, thereby enabling you to buy and sell Bitcoins (SuperBTC) in a trustless manner. The risk comes from the servers that actually store the real Bitcoins. If all of those servers
are somehow compromised and the Bitcoins are stolen, the SuperBTC become essentially worthless. Another limitation is that in order to be traded on the Nxt Asset Exchange the coins have to be supported by the MGW technology. In the longer term there is a plan to make MGW a totally decentralized and trustless system. In the meantime, it is operational and on the forefront of the most cuttingedge technology of the digital space today.
Through Account Control, a predefined number of approvals has to be reached in order for a transaction to go through. For example, a specific group of people have to approve a transaction through voting. It significantly increases security and is a particularly important feature for businesses. Account properties are name and value pairs that can be used to endorse accounts as having been verified or authorized by third parties. Account properties can be set up either by the account owner, or by another account. Thus a third party could set an account property to another account that is not under his control. The setter of an account property can edit it by replacing its value with another. There is no limit on the number of properties an account can have. On the development road-map there are two other features, two factor authentication using hash chains and controllable assets. The two factor authentication feature will further secure the accounts. Controllable assets are designed to satisfy legal requirements that only authorized accounts can purchase certain types of asset.
Most Recent Features Coin shuffling is a brand new feature that is available for use with currencies in the Monetary System, assets in the Asset Exchange, as well as for the Nxt token itself. With MultiGateway technology anyone can shuffle SuperBTC and withdraw it afterwards to a real BTC address. Compared to the traditional mixers, the Nxt shuffle is a decentralized and cheap option. Singleton asset is a new type of asset on the Asset Exchange. Each has a quantity of one and its not divisible. In other words: one asset, one owner. Possible use-cases are different kinds of certificates.
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Nxt Links
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Nxt and the Law
Legal status of bitcoin From an article published on Nxter.org in June last year: declaring the use of bitcoin as a parallel currency to be illegal (Russia). whilst allowing citizens to buy or sell bitcoins amongst themselves, banning the country’s banks from processing transactions involving bitcoin (China). stating (or at least intimating) that they do not recognise digital currencies as legal tender and therefore do not regulate them (Ireland). treating bitcoin as a commodity and banning its use as a currency (Japan). treating bitcoin as a foreign currency and banning its exchange with the national currency (Iceland). announcing the creation of a national digital currency and banning all others (Ecuador). regulating digital currencies to the extent of requiring ‘digital currency businesses’ to comply with antimoney laundering laws (Isle of Man). announcing proposals to consult on how best to regulate digital currencies and in the meantime issuing guidance regarding their status/treatment for tax purposes (the US and UK). A more comprehensive overview, currently up to date, is the Wiki page: 'Legality of bitcoin by country'.
A
n in-depth review of the various approaches to digital currencies being taken in different jurisdictions around the world is beyond the scope of this short report, which attempts to give a general overview of the current legal situation as regards Nxt. As is to be expected, pending any unified approach being worked out, there is considerable variation between different jurisdictions as regards the legal status of Bitcoin and digital currencies. A sense of this variation is given by the extract on the left side of this page. Unlike the centrally controlled private blockchain technology being developed within the banking sector, the functioning of a genuinely decentralized and independent digital currency cannot itself be regulated since there is no centralized issuer or organiser. Data is not produced, validated or stored centrally and the 'currency' supply is enforced purely by mathematical algo-
rithms. Accordingly there is either no human agency, or at least no identifiable human agency, in control of a public blockchain system, thereby making regulatory requirements meaningless or their imposition impossible to enforce. Thus, while a public blockchain based digital currency, (like Bitcoin, NXT or Ether), could in theory be banned – i.e. a law could be passed purporting to ban its use altogether - the protocol as such cannot be regulated. Instead, any regulatory attention must necessarily be confined to focusing on organisations that perform certain functions involving digital currency transactions, including: - digital currency exchanges. - money service businesses. - businesses that accept cash payments for high value goods. - crowdfunding platforms.
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As well as the development of new regulations specifically designed to address digital currencies, there is also the possibility that existing regulatory regimes can be applied to the field of digital currency systems, depending on how they are classified by regulatory agencies: as currencies, or commodities.
In its decision, CFTC stated that the platform (Coinflip) was in breach of the relevant legislation: ...by conducting activity related to commodity options contrary to Commission Regulations and by operating a facility for the trading or processing of swaps without being registered as a swap execution facility or designated contract market. Specifi-
A Currency or commodity? In the US, in a case concerning an unregistered Bitcoin options trading platform, the Commodities Futures Trading Commission (CFTC) ruled in September 2015 that Bitcoin comes within the meaning of a 'commodity', as defined by Section 1a(9) of
cally,
during
the
Relevant
Period,
Respondents operated an online facility named Derivabit, offering to connect buyers and sellers of Bitcoin option contracts.
By contrast, within the European Union, it has been decided that Bitcoin is in fact a currency (i.e. a means of payment), not a
Unlike Bitcoin, which was designed purely as a payment system, Nxt has been designed to create and sustain financial ecosystems, as it includes: not only a payment system, but also a wide range of other services
Union in the case of Skatteverket v David Hedqvist (Case C-264/14) See the Addendum at the end of this Report for the Court's definition of “virtual currencies”, including Bitcoin. All EU Member States are therefore now required to exempt the service of exchanging Bitcoin for fiat from liability to Value Added Tax (the EU sales tax) on the basis that Bitcoin is a currency (i.e. a means of payment) and not a commodity. It seems reasonable to assume that within any particular jurisdiction all digital currencies, including bitcoin, will be treated equally within that jurisdiction from the legal (including tax treatment) perspective. However, the following published comment by an international law firm, Norton Rose Fulbright, includes a cautionary proviso, at least as regards VAT liability in the EU: Whilst this decision [Skatteverket v David Hedqvist] is confined to the activities of a Bitcoin exchange, there seems to be no reason why it would not equally apply to
the Commodity Exchange Act: "...all services, rights, and interests in which contracts for future delivery are presently or in the future dealt in."
commodity and thus exempt from Value Added Tax (VAT) regulation. This is the result of the decision in October 2015 of The Court of Justice of the European
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other virtual currencies provided such currency has no purpose other than to be a means of payment. (Norton Rose Ful-
bright)
Norton Rose do not elaborate on what other purpose(s) a currency could have which, in their view, might have the effect of changing its legal status from that of 'currency'. Presumably though they would have in mind 'securities' as being one such purpose. Can a digital currency be classified within a jursidiction in more than one way? Unlike Bitcoin, which was designed purely as a payment system, Nxt has been designed to create and sustain financial ecosystems, as it includes: not only a payment system, but also a wide range of other services, for example the Asset Exchange (based on the coloured coin concept - see further the 'Blockchain as a Public Good' section on page 19 of the Report), the Marketplace, Voting, Coin Shuffling, Account Control for phased transactions, Account Properties and Singleton Assets. Indeed, over time, the Nxt platform may evolve to help sustain complete socio-financial ecosystems – i.e. not only businesses but whole communities as well. Does this mean that, as well as being classified as 'currencies' in the EU or 'commodities' in the US, NXT and other digital
currencies which use the coloured coin concept could also be classified as 'securities' and therefore fall within the purview of the regulatory authorities that regulate and protect the securities markets, e.g. The SEC in the US and the FCA in the UK? Apparently not, if one accepts the view of New York Law School professor Houman Shadab. Commenting in respect of the Coinflip case referred to above Prof. Shabab was quoted as saying: The action puts to rest any notion that virtual currencies qualify as securities. Otherwise, the Securities and Exchange Comission would be bringing this action, not the CFTC.” (Coindesk)
NXT, equity crowdfunding and the law Startup investing has, until recently, been the sole preserve of professional venture capitalists, often managing large venture funds on behalf of investors or groups of investors. Individuals who would not traditionally qualify as 'high net worth' or who, for whatever reason, are not capable of accessing start-up investment opportunities via VC funds, have therefore been shut out of
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promising investment opportunities in most start-up businesses. This barrier to investment in start-up businesses for ‘the man in the street’ has began to erode in recent years, with the introduction of webbased crowdfunding, KickStarter being the most successful example. The key development in crowdfunding over the last 2 years has been the creation of the Nxt Asset Exchange (and later, the Monetary system), and similar competitor systems such as MasterCoin and CounterParty. These systems allow start-up projects to issue tokens both as a means of tracking participation in a crowdfunding project, and enabling the digital currency based tokens to have certain values or rights attached to them (for example representing a certain amount of investment capital, giving a share in profits, or allowing voting on project decisions). This is changing the start-up investment market by taking crowdfunding to a higher level: equity crowdfunding, including a token issuance system, provides significant advantages over existing crowdfunding platforms. This functionality can, however, also be seen from a legal point of view as the issuance of an unlicensed security.
Equity crowdfunding (including profit share) being a recent phenomenon, there has been widespread uncertainty regarding the precise applicability of pre-existing regulatory frameworks regarding the promotion and issuing of equity (i.e. company shares/securities) and profit/royalty shares (i.e. units in what in some jurisdictions are called: 'collective investment schemes'). However this uncertainty has certainly not been universal – in the US, for example, equity crowdfunding was clearly banned but is now permitted by the eq-
share in a business whether carried on by a company, an individual or a partnership), it seems that such assets could qualify as units in a 'collective investment scheme' (or an 'alternative investment fund') which are types of financial instrument and if so the promotion and issuing of that profit share would be subject to regulation, albeit that exemptions might apply depending on the particular circumstances. This equity crowdfunding / asset token issuance aspect of the digital currency space is still so new that governmental
Any project considering raising funds via an Asset issue should therefore carefully consult their lawyers in order to make sure that their project is legally compliant. uity crowdfunding law: Title 111 of the JOBS Act, for more details on which follow this link. It remains to be seen of course how well this will work in practice and how, if at all, it will affect the use and development of the Nxt platform. As regards specifically the crowdfunding of an income paying asset (i.e. a profit
policy and law makers have not yet had enough time to consider the issue thoroughly, and so any legal decisions made will be on an ad hoc basis, and therefore subject to review as legislation is formed. It is to be expected that the process of creating legislation to deal with digital securities may take several years.
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Regulation Crowdfunding “Where the profit share being offered to investors is not channelled through a trading corporate issuer/shareholder relationship (e.g. the investor receives a contractual entitlement to profits from a project), the investment may be characterised as units in a collective investment scheme (FSMA 2000, s 235). Because crowdfunding generally entails the pooling of investor contributions or the pooling of profits and/or income prior to distribution to the investor, the investment can also fall under the alternative investment funds regime.... the EU's Alternative Investment Fund Managers Directive 2011/61/EU.”
Any project considering raising funds via an Asset issue should therefore carefully consult their lawyers in order to make sure that their project is legally compliant. Within the Nxt ecosystem, Farla Webmedia recently became the first established physical business based in Europe to issue tokens on the Asset Exchange. In order to avoid the potential problem of having their token issue seen as a form of security, Farla have very clearly stated that these tokens do not represent equity in Farla Webmedia itself, but are purely a means of tracking crowdfunding contributions in order to simplify the repayment process. For a summary of the various approaches to equity crowdfunding regulation being taken by other jurisdictions, see the Wikipedia page of equity crowdfunding and,
for a more detailed analysis, see the review of crowdfunding regulation from European Crowdfunding Network. The ESMA Responses During the course of last year Nxt started for the first time actively engaging with policy makers. In April 2015, a regulatory body called the European Securities and Markets Authority (ESMA) issued a 'Call for Evidence' in respect of 'Investment using virtual currency or distributed ledger technology'. A member of the Nxt community, and practicing commercial lawyer, called appropriately “The-Lawyer-of-Nxt,” responded on behalf of the Nxt community. Of the 18 responses ESMA received, only two of which were made on behalf of digital currency platforms: Nxt and FIMK. This could be seen as indicating a lack of willingness on the part of the digital currency movement to engage with the legislative process. For a detailed correction of certain inaccuracies regarding Nxt made by Italian banking group Intesa Sanpaolo, one of the responders to the ESMA 'Call for Evidence', read this article,
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'If you're not at the table, you're on the menu', published in December last year on Nxter.org and copied by email to ESMA and to Intesa Sanpaolo for their information. Conclusion As mentioned earlier, in the context of digital securities, the entire digital currency market and related technologies are still developing so quickly that the legislative framework needed to properly address and regulate the market simply does not exist yet. Indeed in some jurisdictions such a framework may never exist, either because the particular jurisdiction will never seek to regulate digital currencies in the first place or because it will introduce or continue to impose an outright ban on them. As regards those jurisdictions which are currently seeking to regulate digital currencies, they are trying to do so by applying pre-existing legislation that was not created with them in mind. As previously discussed, a wide range of different positions regarding digital currencies is being taken in different jurisdictions around the world, whether in the form of legal decisions, government
policy statements or guidance issued by statutory authorities. Nxt will continue to engage with policy makers regarding digital currency as and when appropriate and issue corrections regarding the published responses of other responders to policy makers, so far as they concern any aspect of the Nxt platform, as and when necessary. The Nxt community will, if requested, be happy to provide consultancy, feedback and education to any legislative bodies that wish to seriously address regulation of the digital currency market. Unsurprisingly, there is not (and probably never will be) any coherent consensus within the Nxt community regarding regulation – some community members, as a matter of principle, are vehemently opposed to any form of regulation, especially that which would compromise account holders' privacy. Others take a more pragmatic view and accept that in order for Nxt to attract a wide range of users, it will need to be seen to be operating within the law. A good compromise between the different positions might be the following policy statement regarding regulation published on behalf of Nxter.org in the 'If you're not at
the table, you're on the menu' article: Nxter.org supports evidence-based regulation that is: 1) transparent, 2) simple, 3) achieved at minimum cost, while fostering competitiveness, growth and jobs, and which 4) does not: stifle innovation, 5) protect vested interests, or 6) compromise the potential of independent, genuinely decentralized blockchain technology to democratise financial power worldwide.
The first three points (which ESMA, for example, should certainly recognise and agree with) come from here: "Joint letter to European Commission First Vice President Frans Timmermans on EU better regulation", sent on 26 November 2015. The second three points are the reasons in particular why Nxt, and the other serious players in the digital currency industry, need to make sure they're “at the table” (to the extent they are allowed to be by the powers-that-be) when regulation is being formulated rather than, by default, being “on the menu”. Without input from the digital currency communities, any legislation enacted to control this market will almost certainly not be advantageous for the digital currency movement.
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Taxonomy of crowdfunding models The Donation Model Individuals make a financial contribution to a project without any expectation of a financial return on that contribution. Projects and platforms that employ the donation model typically also use a reward or incentive system to help stimulate contributions whereby contributors are thanked for their support with a small reward. Rewards or incentives vary from recognition in the project’s credits to branded merchandise or opportunities to meet with creators and/or attend special events such as a launch party or premiere screening event. Rewards or incentives often increase in number and/or value in accordance with the amount of the contribution being given. The Lending Model This crowdfunding model is similar to any typical lending scenario, where individuals lend money to a project or company with
the expectation that it will be repaid. In the context of crowdfunding, the lending model can take a number of forms, such as:
model, the contribution amounts are determined according to an assessment of the fair market value of the product. In addition, larger contribution amounts are typically accompanied by a promise of more copies of the product equal to the value of the amount of the contribution. Pre-sales are often combined with a rewards-based donation model.
A traditional lending agreement: standard terms are used and there is an expectation for a monetary reimbursement in the form of interest. In this case, the loans may or may not be guaranteed, depending on the crowdfunding platform being used.
The Investment Model Resembles a standard equity investment, where an individual receives equity in an entity in return for financing. There are two standard sub-categories of Investment Model crowdfunding:
A forgivable loan: contributions are reimbursed to the lender only if one of two possible conditions is met: a) if and when the project begins to generate revenue or b) if and when the project begins to make a profit.
Securities Investment Model: shares in the company are bought by investors. In this model, contributors would be buying ownership in the parent company or rights in a project.
Pre-sales: the finished product is promised in return for the contributor’s pledge. In the case of a pre-sale lending
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Profit or Revenue-sharing Model: a share of the revenue or profits of the project is earned by investors, as opposed to shares in the underlying company. This is also known as a ‘Collective Investment Scheme.”
Price NXT Price in 2015
NXT Price, Mar 2014 - Feb 2016
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Role of Financial Privacy The technology behind BitcoinDark
B
itcoinDark is a disrupting digital currency platform which aims to fulfill the original objectives of digital currency: decentralization and anonymity. In other words, it includes all the essential features that are understood to be vital for a fully functional digital currency. For people to be in full control of their own money, it has to be decentralized. Centralization, in the form of the current banking system, treats the money you deposit in your account as belonging to the bank and you as an unsecured creditor which means that “your money”, whilst in your bank account, is not, legally speaking, “your money”, it is the bank's money and therefore at risk of being lost due to fraud, bank administrative/speculative incompetence or even to being confiscated in a Cyprus-style “bail in”. By contrast, the money you entrust to a decentralized, cryptographically secured network really is “your money” and no one else's; moreover it's safe from outside attack.
Financial privacy and anonymity are basic human freedoms and vital for a truly free and well-functioning society. The hallmark of such a society is that the government fears the people: "When the people fear the government, there is tyranny; when the government fears the people, there is liberty." (Thomas Jefferson) Such a society can only exist where people have the freedom to speak, assemble, and transact with each other using a monetary system that is private and incorruptible. Privacy has been built into the BitcoinDark's core from the ground up. A truly private money needs both privacy and usage, as without usage you cannot get effective privacy. The network needs to have a high volume of internal activity. BitcoinDark is developing applications that will make full use of its network and thus secure its privacy through increased volume. For any business, privacy and especially financial privacy are very important as they
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“Privacy is not secrecy. A private matter is something one doesn’t want the whole world to know, but a secret matter is something one doesn’t want anybody to know. Privacy is the power to selectively reveal oneself to the world... Privacy in an open society also requires cryptography. If I say something, I want it heard only by those for whom I intend it.” —Cypherpunk’s manifesto
“We firmly believe that everyone should be free to transact privately, and without the costs imposed by the gatekeepers of the world’s currencies and markets.” —BitcoinDark Team
need to protect their secrets from competitors. Thus a guarantee of privacy will be high on a business's shopping list of requirements when looking for a digital currency platform to use. No business can operate privately using Bitcoin's pseudonymous network: with very little effort anyone can find out what its expenses are and how much profit it's making. Espionage is a real problem, not just between businesses, but also at the (intra)governmental level. A great deal of
edge over whatever may be the centralized alternatives, and the commercial imperative on businesses to start using them will therefore become increasingly irresistible. In SuperNET, the features are not operational yet, though most of them have already been coded. For them to come online a number of other technologies need to exist first. Those technologies are in development and will form part of the overall ecosystem. Removing the security threads Through technologies called ‘teleport’ and ‘telepathy’ BitcoinDark has made totally anonymous transactions possible. Unlike all other anonymity coins, BitcoinDark does not use mixing or ring signatures to achieve anonymity. Instead of simply trying to minimise privacy threats as much as possible, BitcoinDark has been able to remove them altogether with a combination of simple and elegant solutions. Teleport allows you to send money in a way that makes it very hard to track your IP address. It is done through a trustless and decentralized off-blockchain exchange mechanism. Telepathy on the other hand will allow users to send data without the need to know each other's IP addresses.
Sending money through a centralized party will soon be seen as involving an unacceptable risk to security and privacy. money is spent trying to protect and discover business secrets. Sending money through a centralized party will soon be seen as involving an unacceptable risk to security and privacy. Moreover, as the Nxt and SuperNET platforms become more fully operational, they will each start to offer a distinct competitive
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“I am building a complete solution to something that NOBODY has ever created before.” —James Lee
“A big issue with Bitcoin is that it is just so big and no developer before with experience in creating eficient realtime systems seem to have solved these scalability issues. Since people seem to like this bitcoin that means we need to support it, which means creating something that works as a chrome app, which leads to Iguana.” —James Lee
“With Iguana there is very little dependence on anything, not on any API, not on any third party website. It is pretty much self contained and only uses openssl and curl as external dependecies. It does this by directly talking to the coin networks and creating a node.” —James Lee
Furthermore, the transactions are end-toend encrypted and not linked to each other. There is no exact time when a transaction happens and the transactions will use standard denominations. Transactions cannot be linked. In the bitcoin blockchain all the transactions are linked to each other, and if you know the owner of a wallet, you are able to trace his transactions back in time. This is avoided in teleport by using one-time addresses called telepods. Each address is used only once, so its impossible to link it to any other part of the network. This approach was recom-
money he has received in the telepod. In order to combat industrial espionage or government surveillance it's important to hide the fact that you are conducting a transaction in the first place. Instead of submitting a transaction directly to the network, the privacy-server encrypts it multiple times and passes it through several other nodes first. That technique is known as onion routing, which is used by other applications such as TOR. In a mantissa attack you are identified because of the exact size of your transaction. That makes your transaction distinc-
Essentially, ramchains will be very valuable for any service that depends on blockchain information. For example, Bitcoin's blockchain will take only 15BG of hard drive space instead of the current 50 GB. mended by Satoshi, but very few bitcoin users seem to follow that advice in practice. Through a timing attack, someone could find out exactly when a transaction happened. BitcoinDark counters this by introducing random delays and allowing the recipient to decide when he moves the
tive among others and it is easy to spot you on the blockchain. To remove this threat the telepods use standard denominations, i.e. 100, 50, 10, 5, 1 and so on. In the 'last mile' problem the recipient of a message is exposed. BitcoinDark solves this problem through a feature
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called telepathy. It allows nodes in the network to communicate without knowing the IP address of the recipient. Transactions are sent to a 'dead-drop' address which is seen by multiple parties. No one knows who exactly is the recipient, other than the recipient himself. This is because the transaction is encrypted and only the recipient can decode it. Ramchain Through technology called a ramchain, any blockchain can be loaded into RAM. Compared to a hard drive this makes extremely fast search operations possible. In other words, it allows fast random access queries of the essential blockchain information, while keeping resource usage to a minimum. A blockchain requires a large storage space. Through ramchain technology it is possible to reduce the size of a blockchain considerably. It is done by including only the most important information rather than the whole blockchain. Normally the coin daemons can be very slow when responding to requests, particularly in historical processing and in pattern searches. Ramchain solves this by providing lightweight files
BitcoinDark Links
that can be accessed directly without sending a request to the coin daemon. One of the use cases is to boost performance and speed in Multigateway operations. Essentially, ramchains will be very valuable for any service that depends on
networks. It can be run as a Chrome application or in a native mode. The technology has low hardware requirements, so the application could be running in a Rasberry Pi or smartphone. As such it is the gateway to the whole ecosystem.
With Iguana, the blockchain will grow linearly rather than exponentially and therefore people can continue to run their own local Bitcoin nodes. blockchain information. For example, Bitcoin's blockchain will take only 15GB of hard drive space instead of the current 50 GB. Another example is to scan an entire blockchain for all transactions with a pattern “777” in their addresses . Results would be delivered in seconds. Iguana Iguana is a technology that allows direct integration of BitcoinDark and its applications under the same user interface. One of its goals is to create a scalable Bitcoin Core implementation. Iguana utilizes the ramchains' technology and it will talk directly with other coin
Iguana solves one of the problems people generally see with Bitcoin: the size of the blockchain is growing exponentially. Right now it is about 50 GB and in 6 to 9 months from now it will be around 100 GB. With Iguana, the blockchain will grow linearly rather than exponentially and therefore people can continue to run their own local Bitcoin nodes. Iguana's strongest feature is the ability to install SuperNET's applications with one click. It is designed to enable all the services offered by SuperNET to be used across almost all devices and operating systems. Ease of adoption is of course a fundamental pre-requisite for success.
Bitcoin blockchain size in megabits.
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Iguana Clients The SuperNET Team anticipates that many different types of client will be using the underlying Iguana technology called 'Iguanacore'. New agents (plugins) can be activated inside the Iguana powered client, thus extending the client's functionality. It will be possible to have, for example, an InstantDEX GUI client version without any additional functionality besides what InstantDEX will offer. If the user decides that he wants to play decentralized poker with the client he can open the "appstore" and install the Pangea poker agent.
Here is an incomplete list of agents that will be available in the Iguana client
Multicoin Wallet
MultiGateway
InstantDEX
BitcoinDark
PAX
Lets you easily move your favorite coins, and access and combine their features. You can store your coins on SuperNET's non-centralized exchange, or move them to your personal wallet to best fit your needs.
Decentralized crypto-tocrypto exchange that runs on the NXT Asset Exchange. As a third-party clearing house between trades, stores coins on multi-signature server clusters, with each server only having access to one of various keys - the servers must agree for withdrawals to occur.
Enables (near) real-time trading between cryptocurrencies, Nxt Monetary System coins and assets, as well as other services (ie. coin solidation, which allows the sending of coins (including Bitcoin) from all activated exchanges to a single destination.
Cryptocurrency at the heart of the SuperNET that ensures that large-scale surveillance attacks on blockchain finance are impractical and futile. Unlike many of its contemporaries, it does not use coin mixing and is designed to protect user IP association with trades.
Will allow users to lock funds to the value of real-world securities, e.g. assets, currencies, and commodities. With PAX, anyone can invest in stocks or precious metals, lock funds to the US dollar or Euro, and so on, without having to go through traditional exchanges and paying their high fees.
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Teleport
Telepathy
Telepods are packages of information containing everything required to make a digital currency transaction, similar to a signed check. These are encrypted with the public/private key pair of the receiver, so that only the receiver can open the packet and 'cash the check'. This ensures peer to peer privacy. The broadcasting of telepods is designed so that it is very likely to reach the rightful owner, while being handled by large amounts of other nodes. By doing this, an investigator who managed to look at the network topology and flow of packets would have a massive list of possible owners, without knowledge of who it was intended for. Dead drop address is the final destination of a telepod. They are owned by no one and are randomly generated. Upon reaching the dead drop address the telepod is broadcast to a vast number of nodes that are close to it in hyperspace. Note that this is not the same as geographical space. A node in China and another in Mexico are on opposite sides of the world geographically but might be neighbours in hyperspace. Hyperspace location is decided at random and is stored using distributed hash tables (DHT).
Telepathy is a information anonymity technology built with BitcoinDark, that allows anonymous communication between computers, regardless of the kind of information that is flowing. The primary purpose of Telepathy is to allow users to connect and transfer data, without the need to know each other's IP addresses. To do this, it uses the Kademlia distributed hash table (DHT). A Distributed Hash Table is a kind of super-efficient look-up table that allows any node in the network to find the information it needs to route a packet to another node quickly. The ‘map’ of a DHT, which shows where each node lies in a network space, is completely abstracted from the physical location of those nodes and their IP addresses. This is a little like, for example, the London Underground tube map: The map of stations bears little resemblance to the above-ground geography. It is simply a convenience to allow passengers to work out which line to use quickly and easily. So each node in the P2P network simply forwards a packet to nodes closer to the destination than itself - until the distance is zero, which means the packet has arrived.
The above description does not take account of the enhancements currently being made to teleport and telepathy. The forthcoming changes are still mostly undocumented and thus could not be included here.
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BitcoinDark Price BitcoinDark's price in bitcoins, 2015
BitcoinDark's price in bitcoins, Jul 2014 - Feb 2016
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The Middleware of Blockchains The technology behind SuperNET
S
ince Bitcoin first appeared in 2009, there has been an enormous explosion of digital currencies, many of them based on the Bitcoin protocol itself but some, the most innovative, using their own original source code developed from scratch. Competition is intense and only the very best and most useful initiatives will survive, with the rest falling by the wayside. At least that's how new industries normally develop. But, one may think, what a terrible waste of time, effort and talent.
“Full many a flower is born to blush unseen, And waste its sweetness on the desert air.” - 'Elegy written in a country churchyard.' Thomas Gray (1716 - 71) Not only a waste so far as the individuals who 'fail' are concerned but also from the perspective of humanity itself which is in desperate need of alternatives to the poverty-enforcing, environment destroying debt-based monetary system called fiat. What was needed was someone to think of a way to foster cooperation in place of competition. And someone did. That
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someone was an anonymous developer called “James Lee” (aka jl777) and the way which he, now assisted by many others, is working hard to develop is called SuperNET. In effect, SuperNET serves as a middleware between the blockchains and the services, applications, and businesses that are built on them or use them. The problem is that on their own the technologies of each platform are isolated from each other and therefore, no matter how well they satisfy the specific use case(s) for which they have been designed, they
SuperNET
may not be able, on their own, to achieve sufficient penetration even in a niche market to become commercially successful as stand-alone services and will in any event certainly not be able, on their own, to develop into the self-sustaining financial
rency platforms will, once their combined range of services is sufficiently wide, together constitute an eco-system in its own right whilst at the same time in effect cross-marketing each other's services, thereby helping every currency platform
For the developers to be able to create a wide range of end-user solutions including, so called killer applications, it must be made as easy as possible for the application developers to use the lower level tech that such applications involve. ecosystem that is needed for digital currency to become a serious rival to fiat, which of course is the true competition. Anyone wanting convenient access in one place to all the various features offered by different blockchain technologies effectively has two options: join SuperNET (which is now 18 months in development) or start developing their own version of SuperNET and try to catch up. Through the interconnectivity provided by SuperNET, the participating digital cur-
to become individually successful in their particular niche markets. However, to be successful a platform first needs application developers to build their services on top of the framework. In this case of course the framework is the SuperNET and its core coins. For the developers to be able to create a wide range of end-user solutions, including so called killer applications, it must be made as easy as possible for the application developers to use the lower level tech that such applications involve. Even the
“SuperNET is a collaborative community of participating cryptocurrency coins and their development teams, alongside innovative coders, networking experts, social-media and commercial development specialists and third-party service-providers, seeking to create a united platform of technologies focusing on the establishment of decentralized delivery of previously centralized online services.”
API In computer programming, an application programming interface (API) is a set of routines, protocols, and tools for building software and applications.
Role of BitcoinDark BTCD is the base currency for the SuperNET network and as such will be in the middle of all transactions providing anonymity by default. The SuperNET code runs inside BitcoinDark.
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“I think ultimately people should only need to know that underneath their app, it is crypto, so they don't have to worry about arbitrary confiscation. But other than that, the less details that are exposed to the end user, the better. But the less is visible, the more work it is to do the automatic operations needed to encapsulate it. This is why layered API is quite popular and practical to create large scale ecosystems.” — James Lee “I want to be the leading SuperNET applications creator. By making dozens of SuperNET reference applications, I will demonstrate how to make money via SuperNET. Similar to what I did with the NXT AE. Instead of telling people via fancy graphics and press releases, I will just do it and let the market decide how much they like it.” — James Lee
most basic operations are usually quite difficult to achieve. For example, getting the balance correct in a multi-signature address still requires a lot of coding, despite years of developmental effort. Lastly, it is important to note that SuperNET is the entire range of services, tools, assets and selected features of participating digital currencies accessible from within the SuperNET client by virtue of the Iguana platform, which is the code (comprising an ever-growing set of APIs) which runs inside BitcoinDark. The code is all open source, and is currently being developed by the concept originator and lead developer James Lee. It has an asset listed on the Nxt Asset Exchange, and a share of its planned revenue streams will be distributed to the asset holders.
within their SuperNET client. That means developers can create and easily integrate new functionality into their projects. James says that he will continue to put more and more functionality into Super-
In the future it will be possible to make a drag and drop GUI whereby you can connect the different modules and end up with a fully customized working crypto solution. NET. He estimates that there will be over 100 API calls in the long run. Development won't be centralized, as anyone will be able to make a new SuperNET agent. It will be possible to code a new agent, publish its availability, and start selling subscriptions. The following languages are currently supported: C, C++, Clojure, D, Dylan, Erlang, Fortran, Go, Haskell, Haxe, Java, JavaScript (Node.js), Lua, .NET, Ocaml, Perl, PHP, PicoLisp, Python,R, Ruby, Rust. Thus anyone can
Agents The usage of digital currencies and SuperNET technology is made easy through a system of plug-ins, also known as Agents. The Agents are independent pieces of software on top of the platform. They integrate into the SuperNET core thereby allowing anyone to download and use them
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make use of the platform and start creating their own applications. In the future it will be possible to make a drag and drop GUI whereby you can connect the different modules and end up with a fully customized working crypto solution. If you want anonymity functions, just add an anon agent. In case you want a blockchain, add the blockchain agent. If it needs to support assets, add the asset agent. How about atomic cross chain trades? Just add that agent. The SuperNET platform is still under heavy development, but it will create a powerful ecosystem once it is finished. Pegged Asset Exchange In addition to the current lack of interconnectivity between the different blockchains, another (more serious) obstacle potentially preventing businesses from adopting digital currencies is price volatility. To deal with that a SuperNET team, led by James, is developing a Pegged Asset Exchange called PAX. Through PAX, people will be able to trade digital tokens that are tied to a real world value.
Like all the other SuperNET features, PAX has been integrated into BitcoinDark's core. It is one of those SuperNET plug-ins or Agents. Through it, users can buy and sell pegged assets, including major currencies (USD, EUR, GBP, CNY), commodities (gold, silver, copper), ETFs, and stocks. It is similar to futures contracts, and long and short trading up to 25x leverage will be available. PAX, like everything else, is completely decentralized technology with no single point of failure. Thus it cannot be shut down by third parties. The difference with other pegged systems currently being developed is that PAX doesn't require 2x to 3x deposits of the traded amount. When a trade goes underwater (i.e. becomes worthless) it is just closed. Accordingly, there are no market sells to closes. Neither are there any lenders, as everyone is a depositor. For short term trading you will have to pay a certain interest, and that is how it is subsidized. Technically speaking, the PAX gets its price feed through BitcoinDark. PAX will list the available inventory, interest rates and whatever leveraging is possible. The nodes
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securing BitcoinDark network run the price-feed and it is verified just like normal transactions are. In order to distort prices, you would need to have over 50 % of the network under your control. If the system becomes too distorted in one way, it will no longer take orders. It is therefore possible to run out of inventory. The more capital comes into the other side of the trade, the more inventory is automatically created for the opposite side. In order to avoid hitting the limits more interest is paid to the side that is low, while the over bought side gets a much smaller interest rate. In extreme cases the interest may even become negative. The interest rates are adjusted in real time. There are three main customers: those who want to earn interest, traders who buy the opposite direction inventory with leverage, and day-traders who bet on day to day price movements. In conclusion, PAX allows you to earn interest on your holdings, to buy and sell without the need for any counterparty, and to create a portfolio across many markets without creating random market chaos.
SuperNET Links
“BitcoinDark’s Pegged Asset Exchange (PAX) enables users to buy and sell pegged assets, including major currencies (USD, EUR, GBP, CNY), commodities (gold, silver, copper), ETFs and stocks. PAX is completely decentralised and has no single point of failure – meaning it cannot easily be shut down by governments or other third parties.” “InstantDEX, PAX and also BitcoinDark itself can be stored on your own personal machine. This means that you will always have access to your assets: no more need for brokers and/or banks to function as your middleman! From now on you can do it from your own home.” Source: bitcoindark.com
PAX Links
Pegged Asset Exchange infographic. Click the image to see the full infographic.
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SuperNET Price SuperNET's price in bitcoins, 2015
SuperNET's price in bitcoins, Oct 2014 - Feb 2016
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Mission Provide a platform of support and cooperation for innovative, valueadding blockchain technologies. Give users a single point of access.
Vision Harmony and collaboration between decentralized technologies.
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SuperNET Core Coins When SuperNET sees an innovative digital currency that it thinks would add value to the network (i.e. be able to add some new, useful SuperNET API functions), it invites the currency developer to join and, if they agree, SuperNET as part of the deal buys a stake in the currency, typically 10% of the existing supply, in order to show its financial commitment. Thus SuperNET is backed by all the currencies in the network.
Market Capitalisations, December 2015
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Vericoin – VRC
VPNCoin – VPN
BitStar Coin – BITS
ChanceCoin – CHA
Vericoin uses a Proof-of-Stake-Time protocol which will make stake distribution more fair and increase overall network security. A technology called VeriBit makes it possible to spend VeriCoin wherever BitCoin is accepted. VeriSMS on the other hand is a service that allows VeriCoin to be sent to and from nearly any cell phone in the world using SMS. SuperBIT is one of VeriCoin's core contributions to the SuperNET. It will be a completely Decentralized version of VeriBit which will "attach" the ability to spend ANY coin within SuperNET wherever Bitcoin is accepted.
Decentralized Virtual Private Network (DVPN) is based on the Bitcoin Protocol and the original Virtual Private Network (VPN). Compared to a traditional VPN, the DVPN is more secretive about data transmission. Instead of using the traditional validation method of username and password, it uses the blockchain to validate users. The VPNcoin wallet application allows anyone to become a VPN service provider and get paid a fee. Services include support for voice and video chat, file transfer, p2p domain and website creation, tipping and more. If you become a VPN service provider the users will pay VPNcoin for the service.
BitStar has one of the fastest transaction times and lowest transaction costs among digital currencies thanks to a fast proofof-stake algorithm. BitStar coins deposited on a BitStar wallet will automatically receive interest through staking. After 24 hours the coins will start earning interest, which will then be deposited into your wallet by the network. Through the wallet's peer-to-peer exchange BitStar account-holders will be able to exchange their BitStars/fiat currencies amongst themselves. The BitStar platform includes an integrated Lite SuperNet wallet.
Chancecoin is a protocol, coin, and client used to bet on dice rolls and other games in a decentralized casino. Owners of the coin may gamble, with randomness provided by published NY Lottery Quick Draw numbers. Owners of the coin are automatically invested in the house bankroll. The protocol is built on top of the Bitcoin blockchain. Currently the ChanceCoin's fate is uncertain, as it doesn't have a lead developer and therefore development is currently halted.
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Boolberry – BBR
Fibre Coin – FIBRE
Opal Coin – Opal
Syscoin – SYS
Boolberry's major benefit is to provide strong privacy for both the sender and receiver of a transaction. It is based on technology called CryptoNote which is further improved by the Boolberry team through unlinkable outputs and by reducing the the blockchain bloat through pruning the ring-signatures. The MultiGateway will be creating telepods for users, so all telepods would just link back to the MGW account. However, there is still a vulnerability in getting the funds to the MGW. The sending out of the telepods is protected, but it is a privacy risk if an attacker could see that you sent a specific amount to the MGW. Thus Boolberry's CryptoNote technology will create another layer of privacy for the transactions going to the MGW account. For more information about teleport and telepods, see page 43 of the Report.
FibreConnect brings an encrypted and secure messaging system to Fibre. FibreDark gives the users the choice of being able to hide their online IP address and location while connected to the Fibre network. FibreOS is a secure and anonymous operating system. Anyone with a PC or laptop will be able to use FibreOS from a USB hard-drive. It utilizes a custom-made, optimized and hardened Ubuntu environment. Because the OS and wallet data files are stored on a USB, you effectively have true cold storage and your coins will follow you wherever you go. All traffic is routed via TOR giving the user increased anonymity. When you unplug your USB stick no trace is left on the host PC.
Opal Coin has Opaque addresses, decentralized file storage, and end-to-end encrypted messaging. Opaque Addresses provide an anonymous way to send transactions. Encrypted Messaging allows users to send encrypted data anonymously via the blockchain. Opal Coin's development roadmap includes: HTML5 wallet, anonymous file transfers, and Opal marketplace. Opal Coin's services bring another level of privacy and utility to the SuperNET. Opal’s integration with the SuperNET also means their privacy-centric technology will benefit from Telepathy technology. Opal's future is uncertain, as it doesn't have a lead developer and therefore development is currently halted.
Syscoin provides businesses with the infrastructure to trade goods, assets, digital certificates and data securely. Businesses can utilize Syscoin's infrastructure by building their own sites for their individual needs. Using the cryptography of the blockchain, the Syscoin platform enables you to issue, authorize, and exchange digital certificates of any kind. With Syscoin anyone can register as a certificate issuer and issue provably-unique certificates with content of any kind to one or multiple parties on the Syscoin blockchain. This allows for the creation and free exchange of any kind of digital asset such as ownership certificates, warranties, receipts, tickets, certifications, diplomas, software licenses.
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SuperNET Core Coin Valuation The Core coin approach has partly failed due to inactive development. However, VPN is achieving real world utility as a token that's used to pay for VPN time in China. SYS has written a lot of new code for their new beta release. Team VRC also has an active development as it continues to improve its user experience. As a result of the hard work, some of the core coins have risen considerably in value during the past months and thus represent very satisfactory investments for SuperNET. In early 2016 James also reported that SuperNET had bought 21 BTC worth of IOTA during its crowdsale. IOTA is a IoT (internet of things) token that has created a lot of buzz lately.
January 2015
December 2015
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February 2016
SuperNET Holdings and Expenses In the past, SuperNET has used 'SuperNET X2 funds' as well as BTC to pay for development and expenses. The X2 funds are SuperNET assets issued on the Nxt Asset Exchange. Both of these funding sources (X2 and BTC) are now almost exhausted. However, 237 BTC is still held on the Bter.com exchange and will be withdrawn if and when Bter resumes normal operations. Since late 2015 SuperNET has been using a team of freelancers to develop a GUI. The team costs more than $1200 per week, but James notes that the expense will be temporary. The total budget reserved for this is about 100 BTC. Budget-wise however, the biggest thing going for SuperNET is that James is working on it full time for free. Moreover, James recently went to 'GUI school' and is therefore now able to work on the GUI side as well. The SuperHODL account could be used for expenses, as could the superNET account if needed, but James doubts that would ever be necessary. There are also 40,000 SuperNET assets that could be made available for working capital, as well as the rest of SuperNET's extensive asset holdings.
Regarding core coin holdings, it is possible that some core coin holdings would be used for market making activities, which would mean both buying and selling. Generally however, those holdings won't be sold. The IOTA token is not a core coin, and could thus later be sold in order to increse SuperNET's working capital. The situation was summed up by James recently: At current price levels SuperNET's passive income is around $3000/month (staking revenues from core coin holdings). While this is not enough to sustain
all the current GUI development costs, it is sufficient to pay for SuperNET's fixed costs, indefinitely. This is just one of the ways in which a decentralized organization, like SuperNET, is different from a normal corporation with a burn rate, offices, etc. Of course as services come online, my hope is that the dividends they generate will dwarf the passive income, but that is new territory and since SuperNET investment is trading close to the liquidation value of the core coins, really any future dividend is bonus.
Follow the Money Address NXT-H8AL-VEG7-4FL5-G2L4W NXT-USU4-92UY-KEYT-4H649 (SuperHODL) NXT-MRBN-8DFH-PFMK-A4DBM (SuperNET)
Description Expenses are paid from here Working capital Long term holdings
Paid expenses: SuperNET Funds Disbursement Authorization Thread
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Asset SpaceMesh NXTPrivacy SkyNET Omnigames crypto777 Jay Pangea SuperNET InstantDEX NXTcoinsco MyNXT SNN
Owned 35.0 % 24.1 % 32.0 % 47.5 % 31.7 % 42.0 % 41.95 % 14.3 % 24.1 % 24.1 % 62.0 % 67.5 %
Development status
Core Coin NXT BTCD VRC VPN SYS BBR BITS FIBRE CHA Opal
Owned 2.5 % 3.2 % 7.8 % 6.2 % 4.5 % 3.7 % 5.3 % 7.8 % ~5 % 9.2 %
Development status
Cryptocurrency BTC IOTA
Owned 236.8 BTC 18,058,346 IOTA
Addresses NXT-MRBN-8DFH-PFMK-A4DBM; NXT-MRBN-8DFH-PFMK-A4DBM NXT-MRBN-8DFH-PFMK-A4DBM; NXT-MRBN-8DFH-PFMK-A4DBM; NXT-USU4-92UY-KEYT-4H649 NXT-MRBN-8DFH-PFMK-A4DBM; NXT-MRBN-8DFH-PFMK-A4DBM; NXT-MRBN-8DFH-PFMK-A4DBM; NXT-MRBN-8DFH-PFMK-A4DBM NXT-MRBN-8DFH-PFMK-A4DBM NXT-USU4-92UY-KEYT-4H649 NXT-MRBN-8DFH-PFMK-A4DBM;
NXT-USU4-92UY-KEYT-4H649 NXT-USU4-92UY-KEYT-4H649 NXT-USU4-92UY-KEYT-4H649 NXT-USU4-92UY-KEYT-4H649 NXT-USU4-92UY-KEYT-4H649 NXT-USU4-92UY-KEYT-4H649
NXT-USU4-92UY-KEYT-4H649
Addresses NXT-MRBN-8DFH-PFMK-A4DBM; NXT-USU4-92UY-KEYT-4H649; NXT-H8AL-VEG7-4FL5-G2L4W RA7FDvaNFXZNLqosSbCWFbypuvijJNQw5J; RM5NNYdGee6X65aFGkyaRkYocSxQVNsB8d VDAQoJHiANmBDBC94MqqLYXosUEZqfk1p2 VdHevSrSsdFn5Mrbrf7xxM99uthTEhiEpJ SRhwEU1aQk2DPJSC6NTySTdCEtGpS7UF4Y (in Poloniex exchange) (in Poloniex exchange) FKYAYxqtyjFV2s2HSkb2Y5EnR5ANnGGnj3 1Ew8yPv2dUWK36qNDDY46xwfJ3oTX5H5eM oR2n1DJuUbetWEC6yS6a7KdMHcuz1W9Jbs Addresses (in Bter exchange) OZSHBYNQLLKOUDQMZRHMYZQFC9JPXIWNITEOMX9NBDWBBIIWDPBHAZTCQBTOSAYION9RMUIXMIYGZVNXF
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Ecosystem The services and businesses built on top
Business-to-Business Service Provision
T
hanks to the Internet, people from all over the world, who may never otherwise have done so, are discovering other like-minded people with whom to create, in effect, shared networks of selfactualizing power, whether in the form of a profit-making business or other forms of social (including political) endeavour. People power is being mobilised on an unprecedented global scale but the most important aspect, without which nothing else works, is of course the economic aspect; more specifically: business. The Nxt platform is first and foremost a business platform. Businesses that have launched on the Nxt platform are beginning to form a self- sustaining ecosystem by offering services to each other. As each new Nxt-based business is launched the community's experience and expertise grows, making it easier to launch the next one, thereby building
momentum and accelerating the growth of the network effect. Various business-to-business (B2B) services now exist to help newcomers. Through a division of labor, businesses can focus on what they do best. With an idea and a little bit of entrepreneurial spirit anything is possible. Anyone seeking to launch an asset on the Nxt AE faces two problems: a lack of knowledge and a lack of trust. Trying to learn all about the Nxt platform and digital currencies in general can be overwhelming. For users without a business track record it can be also hard to convince investors of their legitimacy. A new asset launch, to be successful, needs to be sufficiently transparent to enable people to do their due diligence effectively, have plenty of prospective clients or customers, a comprehensive business plan, escrow services, and general digital currency know-how.
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Self-actualizing power “The motivation to realize one's own maximum potential and possibilities. It is considered to be the master motive or the only real motive, all other motives being its various forms. In Maslow's hierarchy of needs, the need for self-actualization is the final need that manifests when lower level needs have been satisfied.”
Escrow “An escrow is a trusted person or entity (such as an exchange) that acts as an intermediary for a trade. Escrows are usually used when people do not meet face to face and where insufficient trust exists between those wanting to trade. Bob has digital music that he wishes to sell for NXT and Alice wants to buy digital music for NXT. If Alice first sends her payment directly to Bob, Bob could walk away with her money and never be seen again. So Alice asks and Bob agrees to use Jim as an escrow. Alice and Bob both send their sides of the trade to Jim and once Jim has received both the music and the NXT, he gives Bob his NXT and Alice her music. Both parties have to trust the escrow.”
The B2B services now available for those who are looking to launch a new business include: Cryptofund, an investment fund actively investing in start-ups. It offers help and assistance in launching new projects and businesses on the Nxt Asset Exchange. NXTinspect does due diligence, offers escrow, and consultation services. It was formed by a number of trusted community members. Its services are directly targeted at those who are new to NXT and looking to launch their own asset. NXTinspect helps to create a business plan and a road-map. The collected funds or assets are first held in escrow, and then released based on the agreed contractual terms. BitFirm is a public relations and promotion company. Through its contacts it provides visibility to its clients. With its versatile team, contacts, and digital currency know-how it can offer either standard or individually customized promotional packages. Services include branding, consulting, and content creation. The Viral Exchange is an innovative social media marketing platform. Its ser-
vice is designed to help customers optimize their social network presence. Site visitors are rewarded with micropayments for following and sharing customers' content. Shylock, another innovative platform, offers collateralized loans. Micro loans and peer-to-peer lending are going to develop into a huge market as the world moves towards digitization. Shylock is at the forefront and looking to take a significant market share. It offers competitive loans to anyone in exchange for digital assets. When the loan is paid back, the collateral is returned. In the future it plans to build a fully decentralized peer-to-peer lending platform. Liquid Technologies provides a 'Liquid On Demand' service, that helps anyone to sell or buy large amounts of digital currencies. The selling and buying is done through Liquid's trading bots on various exchanges. The service helps you to get a competitive price for your coins, especially on illiquid markets. CORE Media is an independent media outlet, bringing proper promotional campaigns together with traffic from Twitter,
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Facebook, journalists, bloggers, radio stations, newspapers, magazines, and TV networks. They promise to provide content that can be easily digested by people who have never heard of blockchain technology. Through CORE advertising customers can log in, purchase, and select the location, duration, and other specifications for advertisements displayed on CORE Media's website. Some of the packages also include SEO, back-links, trackbacks, and so on. CORE Guru offers businesses and people in general a chance to educate themselves about digital currencies or life in general. Participators will receive a CORE Certificate of Completion. DeBuNe is building a completely decentralized business network. It lets small businesses collaborate, market, offer, and monetize their expertise or products more efficiently and effectively than any other market-based service. It is based on a transparent, secure, agile, and open source peer-to-peer infrastructure. All the transactional data are permanently stored on the decentralized public information vault provided by Nxt's blockchain technology.
Have You Heard of James? James has been active in the NXT community since December 2013. During that time he has earned the full trust of the community. He is passionate in what he does, and it shows through his hard work and innovative thinking. There was a problem, James saw a solution, then we got the SuperNET. Crowd sale of the UNITY token began on Saturday 6th of September and in 48 hours 2000 BTC or almost $1 million USD was raised.
The best way to describe James is to quote what Apenzl has said about him in one of his articles: “James answers questions, adds a few new ideas, sleeps on them and the next day, lightning having struck, may just happen to announce another new feature for the project under discussion.” I'll let the man speak for himself: here's the transcript of our recent conversation together in a Slack chat room.
“One thing I would like to note is people sometimes think that there is no progress being made, I was one of them. I now work closely with @jl777 and have seen first hand that he is a complete beast when it comes to his work ethic. Sometimes I question if he actually sleeps. He works a silly number of hours per day and definitely does not get enough credit for his dedication to this project.” —killakem
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Audo Hey James! You have been involved with digital currencies for a long time, however people outside of the community might not know your background. How did you get started in the digital currency space and how did you come up with the idea for SuperNET?
base dramatically as there is nothing else to install. Not even Node-js is needed, just one click and it is running native crypto app from within the browser. Audo You are known to work extremely hard day after day, always coming back with brilliant solutions. How much do you actually work and how has the coding process been going lately?
Jl777 I have only been doing crypto for 2 years, before that I was coding my own realtime Forex trading system using SVM predictors. The SuperNET idea was coming from the insane amount of clone coins that had no actual new tech. All these pure clones do nothing to advance crypto, so they just distract and drain resources from the real coins that are doing new things. Since crypto isn't mainstream yet, clearly something new must be created.
Jl777 If I am awake, I am usually working. 16 to 20 hrs per day, but I do take the occasional day off. It is a marathon and the coding is advancing like it always does. Most people are just so impatient and have no idea what is required and make judgements based on superficial things.
Over the months things have evolved more and now there is the Iguana project that encapsulates a mass marketable solution, which also undoes the pure clone's "work". The Iguana is able to talk to multiple coin networks at the same time from the same application, but it is only for the basic coin functions.
For example, I wrote Iguana from scratch in November and I had to learn the Bitcoin protocol as I had never actually done anything with that before. But the networking code was using a large library and I couldn't understand what exactly was going on. So I wrote an entire peer management networking from scratch. Now I am getting 125%+ of the rated bandwidth when downloading the BTC blockchain. On the 20mbps (bandwidthmeter) connection I am downloading the entire 52GB blockchain in about 6 hours. it is sustaining more than 25mbps and up to 40mbps. And the entire Iguana is very small, just half MB of compiled code (~7000 lines of source code now) and it is storing the BTC blockchain as a ramchain.
Audo So the SuperNET and Iguana project are not closed or isolated projects, but rather add to the overall digital currency ecosystem? How will Bitcoin, for example, benefit from these projects? Jl777 Everything is connected. Iguana will allow people without 50GB free HDD space and a high end computer to run a local bitcoin node. I don't have the exact size figures yet, but I estimate around 15GB of permanent HDD storage is needed using ramchains at current BTC blockchain size. Also as an application, it expands the potential user-
Audo Hard work will always be rewarded in the end :) Next I would like to talk about the future. With SuperNET and BitcoinDark you are building a complete ecosystem for digital currencies. What is your long term vision? What will we see in 5 or 10 years?
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Audo I share your vision about the coming capital controls and financial instability. There are a lot of people in the developing world who don't necessarily have access to the traditional backing system at all. Do you see them using digital currencies for their financial transactions? An argument has been made that those places would adopt the blockchain technology before the Western countries.
Jl777 2020 and 2025.
Audo right :)
Jl777 Kenya shows that countries without entrenched interests using old tech adopt the new tech much faster. That's not a matter for debate, it is proven.
Jl777 More seriously, in the long term crypto will be an invisible thing to 99% of people. There will be portable devices that deal with money. Already we see entire computers the size of a USB stick, not sure about their power source but that is probably the limitation.
Audo The last question! You might not be able to give any specific answers, but many investors are eager to know what they should expect to see in 2016. For instance, will I be able to trade commodities through PAX and play decentralized poker?
In Japan they have been doing mobile payments since before 2000. It is a centralized system, but I think Japan has the most advanced payment systems as far as usability goes. So the logic is that that level of portability and ease of use becomes crypto enabled.
Jl777 Yes, though with PAX you would need a participating gateway to convert to the real item. Doubtful we can get gateways for other than the main currencies and a few precious metals. The recent events have changed the timelines a bit, but it just means that I have to prioritize the fully independent final solution, instead of an interim version with external dependencies.
These days, when you need to be a programmer just to get something installed and working and have to spend time getting blockchains sync'ed, will be the "good old days" that people will look back on. Like when the Internet didn't have websites. Over the next decade the sequence of financial confiscations (indirect and direct) will push more and more people into crypto. So that will be the one user visible aspect about crypto, the fact that each person has full control of their own money.
Audo Thank you! We will continue to follow developments and look forward to talking again soon.
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InstantDEX A decentralized trading middleware
I An Orderbook An order book lists the number of shares, coins, or assets being bid for or offered at each price point, or market depth. The order book is dynamic and constantly updated in real time. A matching engine uses the book to determine which orders can be fulfilled.
nstantDEX is a core service for SuperNET. It will allow near-real-time exchange of one digital currency for another, in a decentralized way. It utilizes Nxt's decentralized asset exchange as well as BitcoinDark's tradebot and privacy technology. The long term goal is to connect all digital currencies via decentralized exchanges and eliminate the need for centralized exchange completely. InstantDEX is best described as a trading middleware as it does not hold any coins itself. Users can communicate with multiple exchanges, no matter if they are centralized, distributed, or decentralized. This is done by combining all the order books of the exchanges into a hybrid one. Thus users can access all the exchanges from one place. The main problem of centralized exchanges is that the coins are vulnerable to hacks and thefts. Even though InstantDEX does not solve this problem directly, it is a
step in the right direction. As well as the traditional central exchanges, various decentralized platforms will also be included, such as Nxt Asset Exchange. The user is free to choose where he wants to trade, and if he wished could exclude all the central exchanges in which case his trading would be totally decentralized. Currently there are multiple decentralized asset exchanges either in operation or in development. For instance, Counterparty, Mastercoin, and BitShares have decentralized asset exchanges and the platform Ethereum is developing its own asset exchange. Traditionally a centralized exchange is needed in order to trade two assets from a different platform. InstantDEX solves that problem by offering a decentralized ecosystem of technologies including the Multigateway, MMatrix nodes, Ramchains, FinHive (SkyNET) and BitcoinDark. At first InstantDEX will support the most popular centralized exchanges such
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as Poloniex and Bittrex and the decentralized Nxt Asset Exchange. Through Nxt Asset Exchange the MultiGateway assets become tradeable as well. Adding the Pegged Asset Exchange (PAX) and direct atomic swaps from local wallets is on the development roadmap. Other decentralized exchanges, such as Ethereum's EtherEx or Counterparty's exchange could be included in the future. Trades are negotiated directly between peers in near-real time. Nominal flat fees are charged rather than a percentage of the trade. The size of the fee depends on the source of liquidity (the exchange) and its transaction fees. All fees earned are paid to InstantDEX asset holders. Let's get more technical The US dollar is considered an 'index' currency in the foreign exchange markets. In the same way the DOW Jones is the index in NY's stock exchange. In the case of SuperNET there will be two index currencies: BitcoinDark and JL777hodl.
All the coins have to be traded against the relevant index currency, otherwise there would not be enough liquidity. On the digital currency and privacy side of things is BitcoinDark. All exchanges between non NXT-assets and digital currencies will be traded for BTCD first and then exchanged for the intended coin. This will be done automatically and in the background. On the Nxt asset exchange side of things there will be JLH (JL777hodl), a NXT asset which will function as a reference exchange for the trades on the Nxt Asset Exchange side. Because InstantDEX uses BitcoinDark as its index currency the trades will be carried out using the privacy technologies: teleport and telepathy. Thus bitcoins and other digital currencies can be traded in complete privacy without modification to their protocols. As a decentralized technology the InstantDEX doesn't have a know your customer (KYC) policy. The actual trade happens through a market maker, which is an automated trading bot sitting on top of the InstantDEX.
The trading bot has balances in a local wallet and in a central exchange. After the trade the market maker will send coins from the local wallet to the person who bought through InstantDEX and at the same time buy or sell coins in the central exchange in order to balance the arbitrage situation. Anyone can invest in the various tradebots and their revenues will be shared among investors. Writers of the tradebots will earn fees. Unlike the traditional bot where you have to pay a flat rate fee of between $100 to $1000 or even more, using these tradebots you only pay if the trade is profitable, the amount being calculated as a percentage of the profit. Thus people do not waste money on bots that do not work and the people that do make bots that work will earn a good income. The trading layer is separate from the order book layer. InstantDEX is the order book layer, and the trading layer can be anything. The trade could go through an exchange, MGW or the Nxt Asset Exchange, an atomic coin swap, or a pegging mecha-
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nism. More types of swaps will be added with time. This technology does not rely on only one way of doing things, instead it is designed to be extensible by third parties and therefore to grow over time. A network of computers called MMatrix nodes form a peer-to-peer messaging protocol. These nodes allow the hybrid orders books to be instantly updated and the trades to be instantly cleared after they are matched. Incentives are set so that nodes which pay the most fees to InstantDEX benefit from having first pick of trade offers. It is similar to Google's ad rankings: the best participants are at the top, but new players can pay to rise up the rankings and be seen. InstantDEX needs an ecosystem of technologies to work: MMatrix nodes, ramchains, BitcoinDark, Iguana, and SkyNET. It is a massive project, but the majority of the code is now ready and trades have been successfully made in an alpha version.
InstantDEX Development Updates November 5, 2015: Killakem said he and James have been extensively testing Iguana's InstantDEX API as well as InstantDEX's standalone version. James has implemented many changes around the use of external exchanges. He has also been busy fixing any bugs found on the fly. The main roadblock and the thing that is slowing the development process from releasing InstantDEX is having a working GUI. Killakem goes on to say that James has now ported the InstantDEX codebase and much of the SuperNET code to Iguana, this greatly simplifies the installation and configuration of SuperNET and InstantDEX.
November 28, 2015: James noted that InstantDEX has been 90% complete for a long time as far as the core goes, but GUI development is lagging behind.
sufficient incentives to make sure there are market makers and competitive prices for the users, which he plans to do using tradebot (NXTcoinsco) technology.
January 29, 2016: Basic InstantDEX API for iguana was made, but higher level API is still left to do. Also, a basic tradebots support was made by James. He pointed out though that the first tradebots will be very simplistic and mechanical.
James further explains that the trades will be 'almost' in realtime, as the transaction has to be confirmed first for the trade to get cleared successfully. That of course is not preferred by traders, but is still a good trade-off considering that there are always risks when dealing with a centralized exchange.
February 23, 2016: James is working towards a working InstantDEX with atomic swaps. It will bring together a lot of the existing tech and create a previously unavailable service. Still, James thinks that won't be enough and to solve the liquidity issue will require building
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March 6, 2016: James says the team is making good progress on the iguana tech based application development, including InstantDEX.
InstantDEX Asset Price InstantDEX price has taken a hit due to further delays in GUI. A new team has been assigned to design it. Back-end is mostly finished, but requires testing and debugging. Code is open source and is available on GitHub.
-16 NXT
Price in Nxt Asset Exchange, 2015
67
-23 %
$354,000
Pangea Poker
P
laying decentralized poker is like playing in a cash game: just sit down, get your wallet out, and put some money on the table. However, traditional online poker sites have strict funding policies, and so you may have to wait several business days for your account to be credited. Credit cards solve that particular issue, but carry security risks including identity theft and getting scammed, with no guarantee that you will necessarily be able to get a refund. Considerations which no doubt put many people off playing who might otherwise have done so. And then when you want to make a withdrawal you have to go through a whole lot more hassle. Additionally some jurisdictions have banned poker playing altogether. Online poker sites today offer complex rakebacks and bonuses. The actual rake percentages are hard to compare, but for the biggest cash games they are around one percent of the pot. For small stake cash
games they are much higher. As a decentralized technology Pangea is capable of offering the same service for free. Thus Pangea is planning to offer competitive rakes from 0.5 % to 1.0 % regardless of the stakes. The rake policy is clear and transparent. The way the rake works is that Pangea itself always collects 0.5 % of the winning pot. That rake goes to the Pangea asset holders via a revenue share. On top of that the person hosting the games can collect a rake for himself. That rake can be anything between 0 % and 0.5 % and it is set by the host. Pangea poker will not itself include an actual rakeback program, but the players could buy Pangea assets which will give them part of the revenue. Many people would not like to play using, or keeping money in, digital currencies as there is too much price volatility. For a successful poker application there has to be a way of allowing you to play with your local currency. Through PAX an asset pegged to
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Online Poker Today “Typically, online poker rooms generate the bulk of their revenue via four methods. First, there is the rake. Rake is collected from most real money ring game pots. The rake is normally calculated as a percentage of the pot based on a sliding scale and capped at some maximum fee. Each online poker room determines its own rake structure. Since the expenses for running an online poker table are smaller than those for running a live poker table, rake in most online poker rooms is much smaller than its brick and mortar counterpart.” “...like almost all institutions that hold money, online poker sites invest the money that players deposit. Regulations in most jurisdictions exist in an effort to limit the sort of risks sites can take with their clients' money. However, since the sites do not have to pay interest on players' bankrolls even low-risk investments can be a significant source of revenue.”
the US dollar, for example, could be used. Having the prices based in fiat will reduce still further the barrier to adoption. There is no centralized server that hosts the games. Instead anyone can host their own table and invite other people to join. Hosts should have a VPS with good ping times, so that all the players can connect to each other; only the host will know the IP addresses of the other players. The alternative would be for all the nodes to publish their IP addresses, but that was seen as a needless disclosure of private information. In modern online poker games automated bots have become a problem. By contrast, an active host can make sure that there are no bots playing. It is like a real cash game, one where there's a human host with human players chatting and having fun. Joining games spontaneously is extremely easy, as is leaving any time you want with all your money under your control. In fact your money is never under anybody-else's control, even when you are playing. There is therefore absolutely zero
counterparty risk involved. The philosophy behind Pangea's solution is that nothing will be as effective at preventing collusion than the free market. The Pangea hosts can offer whatever sort of reputation system which they see fit and the market accepts. Pangea only solves the problem of decentralized realtime poker. Any third party reputation systems would be something run on top of the Pangea technology. For totally decentralized poker there are some technical difficulties. One of them is that poker goes at a very fast pace and thus needs a 3 second or less blocktime. Most blockchains do not have such fast transactions. In Pangea this problem has been solved by letting each table dynamically create its own network where transactions are publicly broadcast. The Pangea technology will also allow the development of many other games of skill. Poker is just the first use-case and application. The decentralized shuffling tech can be used by any other card game.
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Pangea Development Updates September 28, 2015: James says that getting Pangea's low level protocol working was tricky: the proof of concept code was just not clear enough, so it is now split into a generic hostnet777, cards777 and pangea. Hostnet777 allows any node to become a host for a spontaneus group, e.g. poker table, jumblr group, p2p games, etc. cards777 allows the decentralized shuffling and dealing of both faceup and facedown cards (which are actually numbers, and thus can represent anything).
James also confirms that he has solved the 'mental poker protocol', made a proof of concept and that hostnet777 and cards777 are now being tested. The next goal is to release a working command line version that allows the basic functions to be tested. At the same time as it is being tested, James plans to integrate PAX into Pangea.
January 18, 2016: James says he will port Pangea to Iguana as soon as the networking supports some high level routing API.
November 28, 2015: Once the account balance and transaction support is done, then Pangea, InstantDEX, and PAX will be ported into the Iguana codebase, thereby enabling it to do real money transactions directly with each coin network.
Pangea is 75% done for single table play, but needs real money support. Multitable is less than half done.
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mr_e will continue the GUI development once the networking and other issues are resoled.
Pangea Asset Price The original team's inability to solve some of the most difficult problems, combined with delays and the uncertainty surrounding the development caused the price to drop significantly. Recently James has taken responsibility for the back-end and the project is now back on track. A GUI is being worked on by the community, but further delays are of course always possible. Code is open source and is available on GitHub.
-52.8 NXT
Price in Nxt Asset Exchange, 2015
71
-75 %
$120,000
SkyNET Decentralized artificial intelligence
F
inancial analytics is not only a very interesting but also a very lucrative business area. Reliable data is essential for traders to be successful, whether they're trading digital currencies or traditional instruments. Fast data and its simple interpretation and visualization is the key to gaining the necessary competitive advantage. Many current solutions are either too expensive, incomplete, outdated or very fragmented. High quality data is only available for big global players or highly professional actors. A conventional trader isn't able to compete in analytics with big players like corporates, professionals and hedge-funds. There is a reason why those big players are investing heavily in data centers and various statistical models and that is to shift the balance of probabilities in their favour.
FinHive is a first class financial data creator, analyst and vendor. It transforms large scale complex data into meaningful trade strategies by using advanced statistics, technical analysis, machine learning and distributed computation. While FinHive can't provide better access to raw market data, it can compete in analytics, signalling, and prediction at the highest level. It is a huge advantage to be able to monitor price action, fundamentals, formations, statistics, and sentiments regarding thousands of financial instruments from one place. FinHive will provide the most complete and dense data overview by an aggregated visualization, while also providing the possibility of drilling down to every single trading related detail regarding each financial instrument and export it for individual usage.
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FinHive is a company owned by SkyNET which in turn is owned by SuperNET. SkyNET's full version is a subscription based service available to anyone. According to the current plans those who keep a given amount of specific coin in their SuperNET wallet will have free access to a brief forecast report from SkyNET. Furthermore, SkyNET analyzes and presents information for InstantDEX tradebots which then use it for trading. Thus both SuperNET and InstantDEX tradebots will be in an optimal position to leverage their effectiveness on the basis of FinHive's financial analysis. Helix is the reference client built from scratch and used to access, visualize and work with analytical data. It is designed as a lean, fast, modular and dependency free, standalone, cross OS. It connects to the
FinHive data cluster to fetch and deliver data at high speed from any place, anytime. Helix is not only designed to serve as a reference client but also to act as a rich toolbox to create any kind of client, such as enhanced digital wallets or even lightweight exchange clients. In conclusion, anyone can buy a subscription to get analytics about major digital currencies as well as financial instruments, such as stocks, currencies, mutuals, commodities, options, futures and others. Due to its highly optimized automation that subscription will be a lot cheaper than elsewhere and it will offer a wider range of services than any other competitor could.
More information Overview client framework Overview API framework Roadmap
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Development updates October 22, 2015: Heavy work and progress towards the Helix client. October 28, 2015: Back end is almost done, front end is being polished. October 31, 2015: Client framework is close to finish, only chart & visualization component left. The remaining 10 % of 'App Center' is just envelope definitions. Novermber 2, 2015: Nexern has a great marketing strategy in mind – He has already analyzed which are the environments where potential users can most often be found and will focus the PR on these sectors. Novermber 6, 2015: The helix framework is already finished, working on a functional alpha this month. The framework now makes GUI apps very easy to build. The challenge right now is to reduce/visualize the tons of data without overloading the GUI and user.
Development updates (continued) December 30, 2015: Equities, commodities, currencies, indices, mutuals added. A total of 89 366 new symbols are now unlocked and available for Helix. A selected number of macro economic data sets have also been added. The alpha client tests have been made. The next step is to build the beta which includes a smart GUI and the first sample apps, running directly from the App Store. See the whole December update March 9, 2016: Nexern says that all trading data and signals are in place and the important thing now is to get online as soon as possible in order to give FinHive a public face. The first part of the plan is to demonstrate FinHive's potential on some selected preview symbols.
The current website which only has a list of API calls isn't yet sufficient, and Nexern has therefore been working hard to develop it further. Nexern has already written a simple payment server to handle subscriptions from crypto-space. Here are some screenshots of the current version: Image1.png Image2.png Image3.png Image4.png Image5.png
Trading data and signals are already connected, webbased visualization like charts, tickers, and heat maps are being worked on. Nexern is using a mix of standard charting libs and custom components written in D3.js. He comments that it is not perfect but the main purpose is to show what it contains. It is based on html5/bootstrap, so the skin can be changed easily. Nexern has spoken with eth and he will refine the layout a little bit. The online portal/access will be ready at the end of this month, so Nexern can then finish the desktop client for the traditional traders.
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SkyNET Asset Price SkyNET (FinHive) has been making steady progress, as shown by the above updates. The development progress can also be seen on their homepage, where it is updated in real time. As with any project of this scale, future delays and roadblocks are of course possible.
5.1 NXT
Price in Nxt Asset Exchange, 2015
75
20%
$180,000
SuperNET Dividend Flows
I
t is often true for a business that 20 % of the products make 80 % of the revenue. Still, the remaining 80 % of products are necessary. For example, supermarkets sell milk at a loss while making the profit from other items. Those other items need milk to be there in order to obtain the customer. In a similar way some parts of the ecosystem might generate 80 % of all the revenue, yet they need other parts to function. Thus it's good that some of the revenue flows to the other assets and thereby keeps them healthy. When an asset receives revenue from another asset, its issuer can decide whether such revenue should be used to improve the asset-related service(s) or just pass it on to the asset holders as a revenue share. All the assets are completely independent from each other. This also allows a way for investors to capitalize on the asset indirectly. Owning an asset such as Pangea might be a legal
risk in some jurisdictions. To avoid those risks the person can hold PrivateBet instead, for example. Another reason for an investor to buy an asset down the revenue chain would be to decrease the risk of a smaller asset not succeeding. Thus if one smaller asset is not doing so good, some other, such as NeoDICE, might. James describes the revenue flows as rivers and most of them are still dry riverbeds. The development teams are in the process of drilling the wells, but once the water starts gushing it will flow to the whole system. “If you analyze the revenue flows of the future, you will see that it is not random… it has cross-connected paths so that the strongest could help all the others … a built in support structure” — James Lee
At the end of those revenue flows is SuperNET. If you are bullish on the whole ecosystem, you could just buy the SuperNET asset itself, thereby benefiting from the success of all the related assets.
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Marketing Plans, Budget, and Schedule James on development status: It is probably hard to tell, but most of all the hardest tech things have been solved and now just need to be debugged. GUI is not a technical issue, just a matter of resource management to get it done. James talks about delays and time schedule: I really apologize for the delays. I definitely want to be done with all the coding, at least to where it isn't taking 16hrs per day, but I do what I have to, regardless of obstacles, expected or unexpected. Anybody that sees my posts can evaluate the level that I work at. Usually my work product is “invisible” to all but github followers and even then there is so much code it is hard to understand the precision of a lot of it, even for other coders. All this requires trust that it will someday be completed. It will, I just cannot put a date to it due to external factors. However we finally have a halfdozen+ dev GUI team doing good steady work in an open source published on github way, automated jenkins builds, automated documentations.
We have learned from the past mistakes and I am spending time outside of pure coding to make sure all the other parts that I previously just assumed would get taken care of (but weren't) will be taken care of properly. Regarding marketing James explains: As far as marketing goes, there have been calls for more active marketing… when the people that understand the bitcoin tech are made aware of what the most efficient implementation is, this is what I consider marketing. Establishing a niche that you can defend, without constant expenditures of advertising. The advertising comes after everybody already knows about it and its role is to close the deal and get them to use the tech. Once we get a one click install from browser without needing anything else, then we can cast a wide net for testers, even beyond the crypto people. I can't promise any specific date, but I can promise that I will work hard at it until the tech is done, including the GUI's. Once the tech is done, the real battle begins with the marketing side of things, but assuming we have the best tech that
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solves realtime decentralized trading and poker that runs in any browser, the marketing of the full end to end solution will be much easier than anything else has been in crypto. The goal is not only the crypto trading market, but beyond crypto, to bring in traditional fiat activities into crypto. James on spending and budget: If you would like to help, please get in touch as we are definitely always looking for more helpers, and if you have the right skills, we can even pay you. However, unlike most other projects that seem to just burn through funds regardless of revenues, I need to keep a strict control on expenditures. The idea is to get to where the income from SuperNET is enough to pay for all ongoing expenses. Currently we have about $3000/month from staking of the core coins, so that would already be enough, other than the extra costs we are spending on the GUI freelancers. I didn't spend the funds last year on the GUI side and used a bounty system, which has the advantage of cost containment, but unpredictable completion times and even I was fooled by fancy videos.
Various Development Updates August 2, 2015: James gave an update about PAX development: Instead of working on GUI or testing I did the 6000 lines of PAX code in the last 3 weeks. Still some details to work out, but I know that: a) people don't like to install anything so b) it needs to run on a website and c) it needs to be fast and d) it needs to be decentralized. Until all 4 are solved, it is not ready for any marketing and in its current state of rapid development, we need testers. August 31, 2015: James talks about Zeroknowledge transmissions: “I am debugging zeroknowledge transmission, this solves the weakness of tor onions. With this, sending can be done privately, even if the network is fully monitored.” September 4, 2015: James solves decentralized atomic cross chain trades: “I think I solved fully decentralized atomic cross chain trades, using standard scripts (i.e. will work for almost all bitcoin forks). The only downside is that it could take a couple hours to complete if the other side bails out.”
September 18, 2015: James coded a new Agent called Jumblr. It is a decentralized bitcoin mixer which uses CoinShuffle protocol.
September 30, 2015: James talks about Jumblr, Pangea, and PAX. The conversation was taken from a SuperNET Slack channel.
November 1, 2015: SuperNET takes over MyNxt hosting and development.
November 11, 2015: An update regarding Nxt API changes.
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November 28, 2015: James issued a general update regarding the current status of the various SuperNET technologies. - Peer management is 90% complete - Raw block management is 90% complete - Ramchains is 70% complete - Transactions and balances 50% complete - Multicoin support is complete, but untested. - InstantDEX core is 90% complete - Pangea is 75% done for single table play, but needs real money support. Multitable is less than half done. - PAX is 70% done, but still needs transaction support to be completed. InstantDEX, Pangea, and PAX also need time to be ported into iguana, that is a separate thing, but about a week each.
Various Development Updates (continued) December 11, 2015: James switches to using a team of freelance workers in order to get the GUI of Iguana finished, he says “We are setting up freelancers who each work on small tasks one at a time. I think that's the best way to manage this.” The freelance developers are paid an hourly rate, and each task has a number of hours allocated to it. February 21: Due to the uncertainty surrounding Nxt's future plans James made a declaration of independence: We the asset holders hereby declare our independence from any single blockchain. An open and jointly developed specification on cross chain atomic asset transfers will be developed. Any current or future blockchain is invited to join. The situation that led to this is well summarized in CORE Media's first SuperNET weekly article. In short, James has a plan to bring the SuperNET assets from the Nxt Asset Exchange into BitcoinDark's blockchain. With atomic swaps an asset could exist on and be transferred between different blockchains, which is the primary goal of this declaration.
March 7, 2016: GUI team is making progress on multiple fronts and at this point the bottleneck could be either the GUI or the core. James considers his efforts to be a marathon, not a sprint, and thus he is not going to push something out in order to just be able to say there is a release.
But James is not yet sure at which point he will do jumblr, micropayments, and asset passports. Micropayments technology will be made for a project called SuperMesh and 'asset passports' refers to importing SuperNET assets from the Nxt Asset Exchange into the BitcoinDark blockchain.
March 8, 2016: avidayal91 says: “Final version of BTCD iguana wallet is still long way coz implementing core functionality will require full replacement of bitcoin rpc with Iguana api calls and debugging which will take much more time than I expected. The timescale is still uncertain. Overall progress of GUI development can be seen here”
Generally speaking, the tasks are being allocated based on a set of use cases James has in mind. In other words, technologies required by those usecases have a higher priority than others and thus will get finished as soon as possible.
March 16, 2016: James has a pretty complete roadmap in mind. Its first step is a fully functional Iguana wallet, which he is debugging now. Next he plans to do an atomic cross chain protocol, which will allow bitcoins to be virtually exchanged through InstantDEX API as easily as they would through Poloniex exchange API. After that comes Pangea and PAX.
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Sasha Ivanov Audo Hello Coinomat! You are a well known name in Nxt circles, but many might not know your background. What did you do before moving to the digital currency space?
Sasha Ivanov, also known as Coinomat, is an active member of the community. He is building an ecosystem of businesses inside Nxt Asset Exchange.
Coinomat Before crypto I was mainly trading Forex and coding automated trading software. I've been keeping an eye on e-currency systems since their inception, still remember e-gold and many other old-school ecurrencies. Have been thinking for ages about some decentralized ecurrency, but I always lacked that necessary ingredient which made Bitcoin possible - namely cryptography. I'm a physicist by education, but I always considered cryptography and maybe even computer science to be in a way inferior to 'fundamental' science. How wrong I was! At first I couldn't grasp Bitcoin. I had always been thinking about a Ripple-like system, inspired by file sharing networks with two-tier architecture. I considered price fixing or some sort of market making to be crucial for e-currency, so I couldn't easily accept fluctuating Bitcoin rates and the lack of some real economy peg. It took me a year or two to fully understand Bitcoin. But even now I'm confident that Bitcoin technology is more about decentralized databases rather than about money transfer, and we should move in that direction.
He recently pre-announced the upcoming launch, scheduled for this Summer, of a new blockchain platform Waves, which will be a decentralized crowdfunding and (financial) asset trading platform. Regarding the competition with Nxt Asset Exchange, he said “let a thousand flowers bloom”, meaning that the more competition there is, the better the outcome will be. Here is my conversation with him back in December.
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Audo There are now quite a few assets under your belt. How many have you launched so far and what are they?
Audo There is a lot of buzz about the up-and-coming projects you are involved in, can you tell us a little bit more about them and your other possible future plans?
Coinomat First asset we launched was Coinomat and Coinomat1. I came to crypto very interested in decentralized securities markets, and was looking for ways to experiment with them. I checked out some centralized platforms first, but they clearly were doomed by design, not being compliant with securities laws. After that I checked out Counterparty, but I found it to be not ready for real decentralized securities markets due to Bitcoin's limitations.
Coinomat Cryptofund is launching new assets and making seed-stage investments in promising crypto start-ups. Currently we're working on building a centralized crowdfunding platform based on colored coins and Nxt, and trying to make cryptoasset.fund compliant in most major jurisdictions. Within the next two or three months the following projects will be launched: Bitfirm.io - crypto promotion company; Shylock.io - first crypto pawnshop where users can borrow liquidity against crypto collateral; a telephony project which will be the first e-commerce project with fully transparent sales - all its sales will be put on the blockchain in real time for transparency and monitoring. Also in a couple weeks' time we'll launch an asset sell platform, which should evolve into a full-scale crowdfunding platform in 2016.
If you want to use Bitcoin as a smart property platform do it with colored coins, and trade them at a centralized exchange. So after that I came to Nxt, which seemed to me to be the perfect solution to the problem. I like the road the Nxt devs took - they just coded the novelty features like Asset Exchange without being concerned too much about stuff like "Turing completeness", "Nothing at stake" or similar purely theoretical considerations. Nxt will go down in history as the first decentralized trading platform, it has already secured its place.
Audo If a group of people not familiar with Nxt are looking to fund their own business, how do they get started? Can they apply to be launched through Cryptofund?
Jl777 helped out a lot with the Coinomat asset launch, he also introduced several innovative ideas like dividend paying assets, and such. Actually what he did was to launch venture funds on the blockchain, which had never been done before. After successful Coinomat ICOs I moved to trading bots on AE platform and launching the MMNXT asset. CoinoUSD asset was meant to be fiat on blockchain, Index asset - Index fund on blockchain, and Cryptofund - crowdfunding venture fund on blockchain.
Coinomat Sure! That's the idea behind cryptofund. Launch other people's projects. Audo Awesome! Thanks for the interview!
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CryptoFund
C
ryptoFund is an investment fund on the Nxt blockchain. Its portfolio includes financial, security, trading, and web-traffic projects that are related to digital currencies. CryptoFund actively invests in various startups on the Nxt Asset Exchange. It allows digital currency enthusiasts to participate in funding of startups and to diversify their investments among various projects. CryptoFund's mission is to support the Nxt platform and that is where it exclusively operates. The fund strives to increase its net asset value by supporting projects with positive cash-flow and verifiable profit history. A shining example of its success is ForkLog, which is on its way to become one of the top digital currency magazines. ForkLog already had an established readership in the Russian and Eastern European markets, and with the help of the funds raised it has now successfully expanded into the English speaking markets as well.
Even before its launch it had holdings in many of Coinomat's previous projects, including MMNXT, Coinomat exchange, EIX, and MMBTCD. Apart from the Coinomat exchange these projects are about trading and market making. Through a campaign called '1000assets' Coinomat successfully found various additional projects in need of funding. So far CryptoFund has received more than 200 emails through the support form, although some of it is junk mail. Since its birth the fund has launched four projects: IndexRev, ForgLog, ForkPay, and BitFirm. Known future projects are cryptomessenger Morze, crypto DNS service Bitname, collateralized loans platform Shylock, and social network CryptoJoin. On the horizon there is also an asset sell platform, crowdfunding platform, and a gambling related project. Through the asset sell platform anyone can buy Nxt assets with other digital currencies or fiat. The crowdfunding platform will be more like Kickstarter but better.
When a new project is launched CryptoFund will get a part of it. Half of what is acquired goes to the asset holders directly as a bonus, and the other half stays in the CryptoFund portfolio. All the assets in the portfolio will start paying out when those projects start creating revenue. That means that the payout structure is mixed, the asset holders are receiving NXT payouts as well as shares in the newly acquired projects. Currently the revenue distribution is as follows: 50% to the asset-holders, 17% to
pay the management fees, 30% to grow the fund's operational capital, and the remaining 3% donated to various Nxt services. The revenues are paid out in the same currencies in which they are earned, including NXT, BTCD, CoinoUSD, and SuperBTC. Funds' net asset values are posted on its website which is updated in real time. CryptoFund is committed to transparency for its investors regarding all its activities and to being regulatory compliant.
About
Cryptoasset.fund is an investment fund actively investing in cryptocurrency startups. The portfolio includes financial, security, trading, web-traffic projects related to the emerging cryptocurrency ecosystem. CryptoFund supports the NXT platform and the funds operations are based on the NXT Asset Exchange.
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BitFirm
T
he new businesses in the digital currency space are operating in a niche market. The audience is relatively small and the people with digital currency know-how are in great demand and although the technology itself isn't yet in great demand by end-users it's reasonable to assume that the best of it will be one day and that the small start-ups being built today might become the giant corporations of tomorrow. BitFirm offers its services to those startups that are looking to enter the market. It is a public relations, promotion, and advertising company. Different people with different skills and a deep digital currency knowledge came together and formed it. Initially it focused on serving the Nxt ecosystem, as that has been the fastest growing platform. A global team ensures that a wide range of people is reached. BitFirm can translate, publish and share content in al-
most any language. A marketing campaign can be directed to a specific location, such as the Chinese market. The people behind BitFirm have connections throughout the digital currency space and are thus able to come up with the best solutions and connect the right people. Customers are served by building their brand through digital currency marketing campaigns. The team creates customized content and publishes it on multiple platforms. Through social media and news sites BitFirm is able to reach a specific target audience of digital currency enthusiasts. BitFirm offers a wide range of packages that include services ranging from websites and social media profiles to banners and infographics. BitFirm is a young company and 2016 will be a crucial year for its success. All in all, businesses such as BitFirm are uniquely well-placed if the digital currency ecosystem starts to really grow.
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ForkPay
N
owadays almost anything can be bought with Bitcoins. However, for someone to pay with another digital currency the merchant would have to support it too. Through ForkPay's plugin, Bitcoin payments can be made in other digital currencies. It is a convenient service that increases the utility of many digital currencies. In other words, each supported currency is now part of Bitcoin's established payment network. On top of that, it creates a layer of anonymity, as a coin with privacy functions can be used instead of Bitcoin. The service currently only works through a Chrome extension but a Firefox extension is in the pipeline. It is based on the well-respected Coinomat Exchange API, which allows users to skip the registration process, making the whole process faster. The goal is to make the process of paying with altcoins as easy as possible.
In practice the plugin identifies a Bitcoin payment address and lets the user choose his preferred payment option. In the second step the user sees how many coins he must send and where. After the payment the merchant receives the Bitcoins from ForkPay and ForkPay receives the customer's altcoins. Behind the curtain ForkPay converts those altcoins into Bitcoins. ForkPay has big plans for the future. One of the development objectives is a cashback program where users get a certain
percentage of their payment back as a loyalty bonus. The second objective is a serverside plugin for merchants, so they can implement ForkPay from their end instead of relying on a client-side plugin. The traditional digital currency payment services accept digital currencies which they turn into fiat for merchants. ForkPay intends to offer this along with a reverse option: accept fiat and turn it into a digital currency. According to Coinomat there is a real demand for such a service.
85
As a unique service it could potentially create a totally new market niche. Lastly, the most ambitious goal of ForkPay is to allow users to pay their credit card bills with digital currencies. That is, pay with digital currencies almost everywhere that VISA or MasterCard is accepted. Coinomat says that it can be done through creating a virtual credit card for each payment. Whilst it would not work in all stores, it should work in the majority of them.
Community Who are we?
The world does not rest on one man's shoulders
W
e are all simply individuals bringing our effort, time, skills, and experience to the table. It's all about collaboration and communication. As James has said:
versatile group of people working on different projects, animated and inspired by a very agile development process and the Nxt/SuperNET's communities' free-flowing, refreshingly self-critical and innovative ethos. We are not building the platforms through complaints and 'support requests', but through people taking the initiative, collaboration and open dialogue. If there is a problem or a need for a certain thing to be done, roll up your sleeves and start working. Expecting to be able to sit back and let other people do all the work tends to lead nowhere. Complex things can be broken down into simple concepts. At the end of the day, everyone finds a way to contribute. We all feel that we are part of the development, even though of course only some of us can do the coding!
I really don't want the SuperNET to be about me. I am just starting it, the community is forming it. So lets not encourage the “hero worship” stuff. I am no hero. I am just a simple C programmer.” —James.
We are not heroes. Rather just normal individuals who have come from all over the world to work on this project. James' vision, right from the start, has been that others will show up and take their share of responsibility. He is no project manager, GUI developer, or marketing specialist – just a simple C programmer, who is building the back-end of SuperNET. The NXT and SuperNET communities have grown as one. We now have a large,
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Total Members: Total Posts: Total Topics Average registrations per day: Average Online per day:
NXTForum.org
88
5549 202255 9015 10.93 128.60
New Forum Topics
New Forum Posts
New Members
89
A Chance of A Lifetime
I
n order to get ahead in life, you should associate with people smarter than you. This is an opportunity to do exactly that. The communities in the digital currency space are full of extremely smart and hard-working individuals. Whatever you currently do to earn a living, by participating in an open source project you get a chance to enhance your skills by working with the best. This technology has great potential, and while we are still small it is a huge opportunity to do networking. You can get to know people from all around the world with very diverse backgrounds. Through different projects you get a chance to learn new skills and to take responsibility. Your background doesn't matter. Neither does your nationality, age, or profession. No one is going to care what type of
90
formal education you have had. The only thing that matters is your willingness to work hard, be trustworthy, and whether you deliver what you promise or not. How can you help? There is a misconception that in order to help you need to be a programmer. However, there are lots of things to do besides coding: for example, design, writing, translating, promotion and advertising, finding bugs, building websites, to just name a few. After a while you will start to find problems that need to be solved. We want you to join us! The more people we have building this ecosystem, the better it will become. Through our contacts and businesses we can help you to launch your own project. We are an open community with its own business ecosystem. Come join us and build your own future.
How Things Get Done
T
he development is horizontally structured, as it generally is in an open source project. There is no one in charge, but it could be said that some have more responsibility than others. Linux is a great example of a project that has created tremendous value. Currently the Linux open source code is estimated to be worth about $5 billion. Nxt and SuperNET are still young projects, but already worth a lot nonetheless. There is a certain inherent motive power in an open source project that is not necessarily present in a traditional business. Whereas a business may become bureaucratic and thus stop innovating, an open source project has a natural tendency to keep
going full steam ahead. The crucial difference is that a business is led from the center outwards, whereas an open source project is led from the edges towards the center. If the center becomes incompetent the traditional business is doomed, but in an open source project the responsibility will naturally shift towards those who create the most value. New people can join without restrictions, and the more value they create, the faster they will advance towards the center. We have a natural hierarchy. The words of those who have gained the respect and the trust of the community certainly weigh more. A highly skilled developer with a lot of time invested in the project has a lot of influence. As does someone with a lot of money who has the freedom to fund what he believes to be beneficial. But, whether financially wealthy or not, anyone can start new initiatives which
91
Open Source Open source refers to something that can be modified and shared because its design is publicly accessible. Open source projects, products, or initiatives are those that embrace and celebrate open exchange, collaborative participation, rapid prototyping, transparency, meritocracy, and community development.
A Bounty Generally people get paid with bounties. First there is a need for something, then the task is announced, someone from the community takes the task, a project scope is agreed upon, and finally the bounty (salary) is paid once the work is delivered.
may or may not gain support. Hard work and innovation are the essential requirements which drive the overall progress of the platform and its ecosystem. With its natural hierarchy and its open source transparency, the NXT community might to the outside observer look like an disorganized group of various individuals. In a traditional business, arguments and discussion take place behind closed doors, and the company image is created and managed by a person who specializes in public relations. When a crisis happens the outside world might therefore know very little about it. By contrast, when a crisis happens in Nxt it may look like we are a ticking time bomb that is
about to blow up. Everything is done out in the open. For example, during the last crisis even the discussions which happened in private chat rooms were made public. Trust has become hugely important in the community – earning it and keeping it by virtue of what you actually say and demonstrably do, rather than by what you say you will do or what you say you have done or who you say you are. Many have learned the hard lesson that knowing someone's real life identity doesn't necessarily mean that they would not lie, steal or cheat. Most of us have invested a lot of time and money into the ecosystem and are wholly committed to its success for the good of everyone. Today the community is made up of those who truly believe in the technologies behind Nxt and SuperNET and their huge potential to achieve significant positive change in the world.
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Horizontal Organization “In flat organizations, the number of people directly supervised by each manager is large, and the number of people in the chain of command above one is small.[3] A manager in a flat organization possesses more responsibility than a manager in a tall organization because there is a greater number of individuals immediately below who are dependent on direction, help, and support. Moreover, managers in a flat organization rely less on guidance from superiors because the number of superiors above the manager is limited.”
“Once upon a time, you could succeed in business by building a better mousetrap – a product that was better than your competitors. Yesterday, you could succeed by building a better ecosystem. Today, you need to build a better ecosystem that continues to be perceived as better and that somehow generates revenue in a world where customers expect things to be free.” —'Why Building A Better Mousetrap Doesn't Work Anymore.' Steve Denning. 28 February 2014.
Our Support Grid
A
n essential pre-requisite for success is to get your message out into what is a fiercely competitive, very demanding, fast-paced marketplace and to keep on getting it out there, consistently and effectively. To achieve that requires a lot of hard work and dedication. Since Nxt launched some 2 years ago various initiatives, all of them started by community members, have now in effect evolved into the collective public face of Nxt development.
93
Tennessee Project
NXTFlow
NXTinfo
Forklog
Tennessee Project is looking to push Nxt marketing and promotion to a professional level in 2016, while making it easier for third parties to adopt and use the platform. Not a small task to take on, but a great team has been assembled. At its heart the team includes Bas Wisselink (Damelon) and Dave Pearce (EvilDave). They each receive a part-time salary on a self-employed basis, allowing them to work freely on Tennessee.
Located in Kyiv, Ukraine is the first NXT embassy. The Founder, Anton Kobrynets, says it is his goal to build a business infrastructure that will widely use NXT. NXTFlow has a few sub-projects, like "earning and living for NXT video blog", and an upcoming book about "Mastering NXT". Through their efforts, a brand called Beavers Fashion Wear is now accepting NXT. Much more is undoubtedly yet to come from this promising young project.
NXTinfo is a website that provides realtime information about the various assets in the Nxt Asset Exchange. It contains various tools to follow asset performance, such as asset evaluator, entry price calculator, and performance calculator. More tools and visuals are in development.
A new digital magazine that has a solid following in Eastern Europe and Russia. It is now expanding into English-speaking markets and looking to challenge Cointelegraph's position as market leader. It reports about digital currencies in general, including Nxt.
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NXTER.ORG
Core Media
Digital Catallaxy
NXT Foundation
NXTER.ORG is a project run by Nxters to inform and inspire people all around the world about Nxt. The project primarily comprises a magazine and news hub focused on crypto-investments and services, supported by writers and translators contributing in 10 different languages. Anyone with appropriate skills can pitch in with their writing/designing/translating/coding and be rewarded for their contribution. NXTER.ORG is working with several partners, and was the first successful project to be built using the Nxt Asset Exchange to award only loyalty points to its initial contributors. All sites are independently controlled, with the minimally necessary coordination being done by a core team, including creating new general partnerships, and helping to launch multilingual campaigns.
CORE Media intends to provide legitimacy to assets built on the most innovative blockchain-based platforms via its numerous media channels. It is a rapidly expanding public relations and marketing hub that has various sub-projects, such as CORE Magazine, CORE Radio, CORE Guru, CORE Advertising, CORE Health, and CORE Social. "A repository and broadcasting network of information that is designed to peel away the layers of misinformation that the current propaganda machine 'mainstream media' has so heavily applied. Reaching far back into our history, it is commonly known that in order for us to move forward correctly, we must know of our true history lest we continue repeating the same tired paradigm that plagues our advance today." ~house
Digital Catallaxy writes in-depth publications about decentralized technologies. Its goal is to provide informative reports with the latest updates. It is an ideal resource for those who have no time to follow digital currency developments daily. Information from a wide variety of sources, including the developers themselves, is condensed and made easily accessible for investors. For startups and entrepreneurs the report makes it easier to understand the new financial platforms and their tools, as well as provide information about the various business-to-business services available. Lastly, developers and job seekers are educated about various opportunities, and encouraged to be part of the open source development.
The inspiration for the NXT Foundation came from the Linux Foundation. The NXT Foundation functions as a bridge between the Nxt community and the outside world. The Foundation does not direct or control Nxt's development in any way. It's just a public face that represents the community. It makes it easy for outsiders to contact someone who understands the technology and can point them in the right direction. In other words, the Foundation is an interface between the old and new financial worlds.
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Dividends in 2015
BGCAFFE Alicia bgcaffe Operations Manager
[email protected]
9.6.2014 2978798152942226372 108,710 NXT-X2ER-EMGR-E3LG-7AR8H
[BGCAFFE] urbanbistro.co.za
22 NXT
79 %
$36,600 BGCAFFE is a brick and mortar coffee place located in South Africa. They have successfully raised money through the Nxt Asset Exchange and expanded their business by opening in a new location. BGCAFFE is currently in the process of re-branding to Urban Bistro. Its new shop has already got the new branding and the first of the rebranded shops will be up and running later this year. For now the asset will remain as BGCAFFE, but there might be an asset swap later, one for one to URBAN or something else that represents the new name.
Monthly
477,913 NXT
The new website is urbanbistro.co.za
11 %
97
Coinomat.com Sasha Ivanov 10.6.2014 7474435909229872610 6220108297598959542 4,000,000 NXT-6MVF-XTDR-MDTK-DPHEU
[COINOMAT] [COINOMAT1] http://coinomat.com
-1.65 NXT
-29 %
Coinomat Founder
[email protected]
$108,562 The first issurance of Coinomat asset was sold out within 24 hours. After the integration of its services into the Nxt platform, a secondary offering was made. There are now two assets: coinomat and coinomat1. No further Coinomat.com stock will be issued in the future. 1.5% of the total transaction volume of Coinomat.com is paid out to the asset holders. Real time transaction volume statistics can be monitored at coinomat.com
Weekly on Monday
Related asset is cryptocard, which is a debit card withdrawal solution for digital currencies.
21810 USD 9%
Cryptocard asset ID: 7110939398145553585
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CORE 11.2.2015 18026565504333172181 417,023 NXT-T4BJ-M2B6-9LHP-8YG77 NXT-NUEG-HFEQ-NU9Z-72KUS
[CORE] http://coremedia.info/
37 NXT
Monthly
3700 %
House
Infinitechaos
Mx
Lootz
Shack4
Damon
3rdStryker
Sigwo
Futurist
Testdruif
$109,500 At the heart of CORE we are dedicated to providing mechanisms for certain real world applications. Global House is designed to be CORE on the ground. Each house will provide the facilities that support our mantra. Building decentralized system through the use of a ‘GLOBAL HOUSE’ network, enabling a system design that ensures no single point of failure while following a focused CORE philosophy. With a healthy form of governance that allows for members to use the CORE brand to lend credibility to their business plans while ensuring prosperity is shared. Funding and/or support for business ventures will be made available and encouraged. By helping to breathe life back into communities, CORE Group will embody the future of multinational organization – of the people, for the people and by the people – the way that it was intended to be. Continue reading
1,364,236 NXT 17 %
CORE was previously known as BTCOR. Also note that Core Media has its own asset: 1584198250936051677
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E9 9.7.2015 asset no longer active 578,200 NXT-UK7N-EL7S-VS6K-5WD5Z
[EIX]
9.4 NXT
94 %
Cassius Management
Whale Manual trading & brokerage
Coinomat Market-making & trading bots
$77,000 E9 is a multistrategy hedge fund. E9 had a successful IPO at 10 NXT per share. E9 generated revenues from manual trading and brokerage activities as well as market-making, arbitrage, and trading bots. A proportion of the profits was used to purchase a wide range of Nxt assets, which themselves generated income and supported the broader Nxt economy.
1st and 15th day
In January 2016, E9 and MMNXT were merged into a single fund, NEXT. This will allow better use of combined funds, more clarity and no conflict of interest between the activities of the two funds. At the same time, a new bitcoin bond (BOND) will launch to generate further revenues for NEXT and directly for BOND holders through arbitrage on BTC/USD exchanges.
1,009,785 NXT 24 %
For further details, read this article published on NXTER.ORG
100
MMNXT Sasha Ivanov Coinomat
14.10.1014 asset no longer active 8,648,144 NXT-KAK4-SDL7-DHGT-9W37B
[MMNXT]
-0.16 NXT
-13 %
Founder
$75,000 MMNXT was an automated trading fund for NXT Asset Exchange. It served as a market maker for the most liquid assets, including MultiGateway assets. At the end of each week all the profits were converted into NXT and paid as dividends to the asset holders. Payout was 60% of the profit. Statistics were published daily on mmnxt.com. In January 2016, E9 and MMNXT were merged into a single fund, NEXT. For further details, see the EIX entry above.
Every Friday
2063193 NXT 20 %
101
LIQUID 31.1.2015 17750387231635486778 314,511 NXT-M2Y7-FKFH-CAQC-DEF7N
[LQD] liquidtech.info
34 NXT
85 %
Jonathan Pfaff
Mike
Market Making
Forex trading
$113,500 Liquid tech focuses on providing unprecedented transparency. They have set an example for competing trading and mutual funds to follow. The initial LIQUID asset sale began on January 31, 2015 and it was over in 12 hours. In April Liquid Tech merged with CVF, which now provides Forex trading in addition to market making. In order to increase profitability there was a new round of funding on November 3, 2015. However, shortly after that the asset price took a hit as the Forex accounts were hacked.
Monthly
Transparency is achieved through a live interface that updates every minute on their homepage. It shows all the trades, the profit or loss made, account balances, and calculates the NAV.
2,865,552 NXT 18 %
The Liquid Tech team has been inspected by NXTinspect.
102
MMBTCD 15.5.2015 8122396658538927693 400,000 NXT-PNVQ-B5RN-QHHR-3BC7U NXT-MXYZ-URGH-HTF5-HE9AU
[MMBTCD]
10 NXT
200 %
Cassius
Azeh
Coinomat
Founder
Founder
Founder
$40,400 The asset was sold out in a little under three days. 1,000,000 NXT was raised from the sale of 200,000 assets at 5 NXT each. 600,000 remaining assets were sent to NXTinspect for escrow. These may be used to raise further funds, as necessary, but only if the price reaches 10 NXT. The aim of the asset is to reward BTCD holders and stakers by bringing liquidity to what is currently a very thin market. The fund also owns other NXT assets, such as E9 (now NEXT), which bring a considerable revenue to the asset holders. Payouts will be made in SuperBTCD.
Every Wednesday
3885 BTCD
Escrow: 600 000 MMBTCD - NXT-6ZP8-X4F4-MM4G-5G8WX
15 %
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NXTER.org
Founder: Arthur Penzl Accounting, business development: mrcluster87 Editors: Robert Bold, Mr.Beer, NxtChina, Ludom, RubenBc, Jose, Danisapfirov, Ima Social media: yassinnxt Translating/writing: Nxt Community
6.11.2014 17290457900272383726 1,000,000 See description
[NXTP] http://nxter.org/
0.25
20 %
$13,742 Nxterpoints (NXTP), which is the asset of NXTER.ORG, are awarded to readers who contribute to NXTER.org by writing, designing, translating or coding. 70% of NXTER.ORG's net profit is paid to NXTP holders. NXT-DG6A-4BEC-4G3W-D3VCC is NXTER.ORG's main account. It holds NXTP and NXTER.ORG funds. NXTP are sent to contributors from this account as a reward for helping to build NXTER.ORG as a global news portal and a hub for Nxt blockchain solutions. 1 million NXTP were issued, 30% of which (300,000 NXTP) will remain locked in this account forever.
Monthly
375130 NXT
NXT-EAVH-SLEV-KSEE-EE2KP holds the assets generously donated to NXTP holders by the Nxt community. Asset dividends received in this account are passed on to NXTP holders monthly, along with their 70% share of NXTER.ORG’s net profit.
27.3 %
Join the movement and/or read more about NxterPoints.
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SIGWONET Steven sigwo Owner
[email protected]
4.9.2015 12628887590172965573 1,000,000 NXT-5UHK-PKHM-V7GH-5FXLW
[SIGWONET] http://sigwo.com
18 NXT
562 %
$147,700 Sigwo builds multipools and does lead development work on UNOMP. He also creates custom autobot multipool exchanges and is a Senior Executive and Lead Developer of CORE. One of his other projects is SigVault , a more secure way to stake and hold digital currencies. SIGWONET will be dividending 100% of any net profits from the following projects or activities:
Monthly
2595490 NXT
- Pool Building/Development. - SigBOT Trading and Arbitrage. - Any bounties or payments received for testing, debugging, repairing, troubleshooting.
42 %
5% of any future assets created for sigwo.com projects will be donated to SIGWONET.
105
Addendum The definition of Bitcoin (and other “virtual currencies”) used in the case of Skatteverket v David Hedqvist (Case C-264/14).
pervision of the business of electronic
price at which he sells that currency to his
money institutions amending Directives
clients, constitute the supply of services
2005/60/EC and 2006/48/EC and repeal-
for consideration within the meaning of
Referring to a 2012 report by the European
ing Directive 2000/46/EC (OJ 2009 L 267, p.
that article.
Central Bank on virtual currencies, the re-
7), in so far as, unlike that money, for vir-
2.Article 135(1)(e) of Directive 2006/112
ferring court states that a virtual currency
tual currencies the funds are not ex-
must be interpreted as meaning that the
can be defined as a type of unregulated,
pressed in traditional accounting units,
supply of services such as those at issue in
digital money, which is issued and con-
such as in euro, but in virtual accounting
the main proceedings, which consist of
trolled by its developers and accepted by
units, such as the ‘bitcoin’.
the exchange of traditional currencies for
members of a specific virtual community. The ‘bitcoin’ virtual currency is one of the
The ultimate ruling of the Court of Justice was:
units of the ‘bitcoin’ virtual currency and vice versa, performed in return for pay-
virtual currency schemes with ‘bidirec-
1.Article 2(1)(c) of Council Directive
ment of a sum equal to the difference be-
tional flow’, which users can purchase and
2006/112/EC of 28 November 2006 on the
tween, on the one hand, the price paid by
sell on the basis of an exchange rate. Such
common system of value added tax must
the operator to purchase the currency and,
virtual currencies are analogous to other
be interpreted as meaning that transac-
on the other hand, the price at which he
convertible currencies as regards their use
tions such as those at issue in the main
sells that currency to his clients, are trans-
in the real world. They allow both real and
proceedings, which consist of the ex-
actions exempt from VAT, within the
virtual goods and services to be pur-
change of traditional currency for units of
meaning of that provision.
chased. Virtual currencies differ from elec-
the ‘bitcoin’ virtual currency and vice versa,
Article 135(1)(d) and (f) of Directive
tronic money, as defined in Directive
in return for payment of a sum equal to
2006/112 must be interpreted as meaning
2009/110/EC of the European Parliament
the difference between, on the one hand,
that such a supply of services does not fall
and the Council of 16 September 2009 on
the price paid by the operator to purchase
within the scope of application of those
the taking up, pursuit and prudential su-
the currency and, on the other hand, the
provisions.
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Further Reading
An impressive book about Nxt solutions, decentralisation and the future of finance. Written by senior members of the Nxt Community; collated and published by NXTER.ORG and Plaisir d'Histoire.
CORE Magazine is one of CORE Media's numerous media outlets. It has a versatile team of skilled writers and dedicated professionals who through these pages present the most up-to-date cryptocurrency news.
Get it at nxter.org/store
Read the latest issue at coremedia.info
Thank you! Since you have read (or scrolled) all the way down to here, perhaps you would like to subscribe to Digital Catallaxy's newsletter and get all their future publications and updates sent direct to your inbox!
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