Many currencies emerged in the recent cryptocurrency bubble and among them, you can term Skycoin as the most undervalued cryptocurrency.
The developers designed it to implement what Satoshi envisioned, a decentralized currency. Yes, that is what Bitcoin is (was).
The proof-of-work algorithm used by the crypto made it be handled by a bunch of users, the miners.
The current Skycoin price is hovering around $30, and the cryptocurrency market cap is at 230 million. Read further to know about Skycoin and why it is the best long-term cryptocurrency?
How is Skycoin different?
The blockchain of Skycoin uses a new consensus algorithm Obelisk, and it replaces Proof of Work (PoW), the one used by Bitcoin. And with this, the developers aim to correct the centralization problem because of the use of PoW algorithm.
Let’s slow down a bit. OK, blockchain? It is the public ledger which records all the Bitcoin transactions.
The developers of Bitcoin developed this system, and now, the cryptocurrencies use this technique. Not everyone can just add a transaction up in the ledger. They have to solve a complex puzzle which the PoW algorithm creates.
The one who solves the puzzle adds the transaction block to the public ledger. The Bitcoin blockchain holds up all the Bitcoin transactions. But this process, called mining, takes up a lot of time and computation resources. And what miners get in return? New bitcoins.
So, where is the problem?
Those with access to more resources, the control of the network rests with them. And as of now, three large mining pools control the Bitcoin network and thus it is centralized. Also, the enormous computing power used during mining does nothing except solving the proof-of-work functions. Although it helps in keeping the system error-free, it’s wasteful.
How does Skycoin help?
The blockchain network of Skycoin does away with mining and the supply of tokens – the cryptos – is fixed at 100 million. There also is greater security in the sense that the transactions can’t be reverted and there is no double-spending. But how long do pending transactions take? It’s as low as ten seconds.
The Obelisk algorithm uses the system of something called “web of trust” which distributes the influence over the network. Every node has subscribers and denser the network of subscribers; more influence does the node has on the network.
Every node has got its blockchain to record its actions. This is a public broadcasting channel, and the actions recorded by the node is visible to the community.
Nodes can then shift their “trust” to others if they find someone is cheating or it is a malicious node, hence, decreasing their influence. The decisions are transparent, and it’s a real democratic setup which also promotes decentralization.
The users earn coin by powering its network, Skywire. It works like a VPN service using which gets you Skycoins when you provide content to other users.
The cost of running also is low, and it is the easiest cryptocurrency to mine.
What is Skywire?
Skywire is the Skycoin’s mesh net, a peer-to-peer network under the control of its users. Based on the blockchain, this is a decentralized community-driven network where you can browse securely without giving your identity to anyone.
There is no internet service provider, and you get to see what others share over the network, a truly open Internet.
As I said earlier, it acts as a VPN. You are a Skywire node and the traffic going through doesn’t link to your IP address.
This Skywire also works as a miner. You earn coins when you contribute to the network. But what? You can share content or become one of the nodes which forward data packets to the destined node or a temporary storage space.
When you consume media or the network resources, you spend those coins. So, you can see that the system is independent of any central control and is self-sustaining. It’s present and gaining its strength as long as users are there and more keep joining. It is built for users, by users.
A local cache node can hold the resources, and any file you download gets copied into that. Peers looking for those files will get it from you and will be able to pass it along. It’s an alternative Internet system that’s secure as well as fast.
Unlike the current system under ISPs, nodes work on the web-of-trust protocol. Users make the decision, can cut-off the malicious nodes and strengthen those who they trust. Everyone has a say and also, the system is safe from exploitation and manipulation because of the “trust” scenario. Thus, Skywire can prove to be even more useful in the current situation where net neutrality is debatable.
Instead of suffering from the monopoly of the telecom companies, getting tracked, getting throttled; Skywire protects your privacy.
Skycoin and Skywire
Skycoin and Skywire are independent of each other but can be helpful together. Skycoin was developed to eliminate the problems Bitcoin has. And the prominent one is the network getting centralized.
With the mining (solving Proof of Work) removed and the new Obelisk algorithm, it’s looking forward to what Satoshi wanted for Bitcoin.
Skywire, on the other hand, tries to solve the existing problems with the Internet, the one you use with the help of an ISP. ISPs control the Internet, and Skywire gives that control to the users. Using Skywire is free, and you can earn Skycoins for running it. You can spend them for better bandwidth.
How to buy Skycoins?
As you see, Skycoin has some unique features that distinguish it from other currencies. And one of them is the removal of mining. It removes human greed from the equation and the chances of 51% attack.
A scenario where a group of miners holding more than 50% of the resources can influence the chain.
Here, in Skycoin, a malicious node is powerless once its network of subscribers loses the trust. If you too want to get hold of Skycoins, it’s available on two exchanges – C2CX and Cryptopia.
The Skycoin wallet is available to download from www.skycoin.net. You, though, need to buy Bitcoins first to buy Skycoins.