Nxt (cryptocurrency)

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Nxt
Nxt logo blue 300px.png
symbol Nxt
Publishing year 2013
Blockchain Yes
Mining No
Website www.nxt.org
Nxt

Nxt logo blue 300px.png
Basic data

developer BCNext and others
Publishing year 4th November 2013
Current  version 1.11.10
(November 18, 2017)
operating system Windows , Linux , macOS
programming language Java
category electronic money
License GPL (since 1.5)

WITH (up to 1.5)

German speaking Yes
nxt.org

Nxt is a 2013 introduced cryptocurrency , which is developed by a decentralized community and on the proof-of-Stake building approach (PoS). Since Nxt, unlike Bitcoin, is based on a different security concept and its own programming code, it is also known as the second generation cryptocurrency.

In addition to its function as a payment system, Nxt offers decentralized marketplace functions, a messaging function and a decentralized alias system (DNS). The Nxt technology can be used for other projects such as twitter-like social networks based on the Nxt network. In January 2018, NXT was ranked 73rd in terms of global market share.

History of origin

On September 28, 2013, a person under the pseudonym BCNext announced the development of Nxt in the Bitcoin forum Bitcointalk and asked for supporting donations in Bitcoins. Those who donated were allowed to vote on the properties of the new crypto currency to be developed and received shares in the currency. The share allocation phase ended on November 18, 2013, and a total of 21 BTC were donated. BCNext withdrew from direct communication with the newly formed community on November 14, 2013 and has since communicated mainly with a software developer in the community in private, but also exchanged views with other participants. On November 24, 2013, the Genesis block, the first block of the blockchain , was released. During this process, one billion currency units were distributed to the individual donors according to their previously contributed shares.

On January 3, 2014 the source code of Nxt was published in parts and examined by various developers for errors and hidden properties in the following days. On March 1, 2014, the complete source code was released as open source software under the MIT license . The community has since developed additional features of Nxt, which are gradually being integrated into the code. In 2015, version 1.5 changed the software license to the GNU General Public License .

concept

Proof-of-stake

So that the participants in the Nxt system can trust individual transactions, these must be confirmed by several users and written to the blockchain. Incentives must be created to maintain this system. In Bitcoin, the process by which new Bitcoins are created is called mining . With this proof-of-work principle (PoW; proof of work) , a fixed number of coins per block is given to the person who solves a given arithmetic problem fastest and thus “finds” the block. The likelihood of this increases with higher computing power.

In contrast to Bitcoin and its alternative derivatives, Nxt uses the Proof-of-Stake principle (PoS), which was first used in 2012 for Peercoin (PPC). Here, the probability of finding a block increases with the amount of coins held instead of the computing power. This eliminates the energy-intensive computing operations, so Nxt needs significantly less energy to maintain the transaction system than the Bitcoin system. The so-called 51% attack with a large amount of computing power is not possible with PoS. Nevertheless, comparable attack scenarios are possible with a very large amount of coins held.

Forging

With Nxt - unlike Bitcoin and Peercoin - all coins are available from the start; no new coins can be created through mining. The incentive to participate in the system and strengthen the network by setting up your own node arises from the prospect of earning transaction fees. This is done using forging: when transferring Nxt, low transaction fees are charged. With forging, the transaction fees for the last transfers are awarded to the person who “found” the last block using the proof-of-stake principle.

Critics object that this will only give money to those who make advance payments and hoard large amounts of Nxt. Proponents counter that anyone who wants to earn money with Bitcoin mining also has to make an advance payment and buy expensive mining hardware that also consumes large amounts of energy.

The transparent forging , which is currently under development , ensures that only those owners earn from the transaction fees who contribute to the stability of the system through the active verification of the individual transactions. At the same time, it also ensures that the forging possibility of a forger is set to zero if he should create a block, but does not. With this new development, the network can be maintained even if 90% of all NXTCoins are attacked.

Nxt's PoS algorithm can be made to run on a smartphone or a single-board computer such as the Raspberry Pi and run in the background on many platforms without interfering with the normal operation of the computer.

Brain wallet

The standard client uses a so-called brain wallet . This means that entering a password is sufficient to access the wallet. Since there is no further hurdle (e.g. knowing a user name), a very secure password must be used. If a password that is less than 35 characters is entered in the Nxt clients, a warning will appear.

A random combination of 50 to 60 characters is recommended; this reduces the risk of falling victim to a brute force attack . Open source software like KeePass generates strong passwords and at the same time allows encrypted storage on the local computer.

properties

Advantages over Bitcoin and other cryptocurrencies

  • Lower storage requirements of the blockchain
  • Lower energy consumption of the network
  • Nxt only uses ten percent of the bandwidth of BTC
  • It is not possible to manipulate the blockchain with a 51% attack (the provision of the majority of the computing power)

disadvantage

  • The proof-of-stake system may offer new opportunities for attack, such as the nothing-at-stake attack , which has never been carried out before.

Advanced features

Nxt is not just a payment system, but a complete ecosystem for new types of business. These can fall back on the existing structure and build their own services on the existing system. For example, Nxt also offers an alias system with which you can set up a decentralized DNS system. Decentralized marketplaces for so-called assets , tradable parts of projects or companies, and digital goods are also provided.

criticism

The Nxt system was accused by critics who already took place in publishing award of all currency units ( Premining ) to investors was unfair and would lead to a concentration of Nxt-Coins to a few people. After the announcement of the Nxt project by its inventor BCnext it was open to all interested parties to buy shares in this new system with bitcoins. A total of 73 people took advantage of this offer.

Further developments

The cryptocurrency NEM was intended as an improvement on Nxt.

Other companies can set up their own blockchain (child chains) on the NXT technology as "blockchain service providers" .

See also

literature

Web links

Commons : Nxt  - collection of images, videos and audio files

Individual evidence

  1. ↑ a b License from Nxt , source code on BitBucket
  2. ↑ Stefan Mey: Ripple, Litecoin and Co .: The most important and most valuable Bitcoin alternatives. In: Spiegel.de . February 27, 2014, accessed March 7, 2014 .
  3. ↑ Thomas Seneca: Whats NXT in the World of Cryptocurrencies? In: Cryptocoins News . January 17, 2014, accessed March 10, 2014 .
  4. ^ Ron Finberg: Digital Currencies 2.0: Meet NXT, the 'Next' Ripple. (No longer available online.) In: dcmagnates.com . January 9, 2014, archived from the original on March 6, 2014 ; accessed on March 10, 2014 . Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. @1@ 2Template: Webachiv / IABot / www.dcmagnates.com
  5. ↑ Lawrence White: The Market for Cryptocurrencies . In: Cato Journal . tape 35 , no. 2 , 2015, ISSN  0273-3072 , p. 386 ( online ).
  6. ↑ NXT Official Launch - NXT Generation of Cryptocurrency Begins Now. ( Memento from January 8, 2014 in the Internet Archive )
  7. ↑ Open source cryptocurrency Nxt is now finishing testing Asset Exchange and was added on Cryptsy. In: CryptoSource . March 4, 2014, accessed March 10, 2014 .
  8. ↑ Notice to NXT clone creators , announcement by the main developer on nxtforum.org
  9. ↑ What Proof of Stake is and why it matters , Bitcoin Magazine, accessed December 31, 2015
  10. ↑ Proof of Stake ( Memento of the original dated December 31, 2015 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. , Description of the proof-of-stake system at nxt.org, accessed December 31, 2015 @1@ 2Template: Webachiv / IABot / nxt.org
  11. ↑ Nicolas Houy: It Will Cost You Nothing to 'Kill' a Proof-of-Stake Crypto-Currency , Lyon 2014
  12. ↑ Bitcoin, Ether and more: The 10 largest cryptocurrencies in the world (t3n from March 6, 2017, accessed October 15, 2017)
  13. ↑ Dollar and Euro were yesterday: Bitcoin & Co. on the rise! (finanzfernsehen.de from May 2017, accessed on October 15, 2017)
  14. ↑ Overview of cryptocurrencies (blockchain-nachrichten.com, accessed on October 15, 2017)