Create a new currency in 2 minutes with the Nxt Monetary System
Nxt’s long-awaited Monetary System – an innovative platform that allows the fast and straightforward creation of completely new cryptocurrencies on top of Nxt – will go live on 10 January 2015.
The Monetary System (MS) allows users to launch new currencies, securing them with the Nxt blockchain using the second-generation cryptocurrency’s established network, rather than requiring that developers create a coin from scratch and bootstrap it with its own network. The ultimate value of the coin is determined by the market, depending on adoption and demand, and by the parameters set by the issuer. However, coins may also be created by ‘locking’ a certain amount of NXT, thereby giving a floor value to the issued currency. The idea is similar to the sidechains development taking place in Bitcoin – with the difference that the additional functionality is all contained within the Nxt platform, without the need for an external two-way peg.
MS brings a high degree of speed and convenience to a process that can otherwise be lengthy and complex – and inaccessible to most users. MS is tailored to real-world application as well as the cryptocurrency community, and aims to make it as simple as possible for individuals and businesses to launch a new coin. The range of potential use cases includes loyalty points, crowdfunding efforts and fiat- or commodity-backed tokens, as well as new altcoins.
The Monetary System allows the creation and launch of coins and tokens in as little as two minutes. Coin features are selected from a list to give the currency the required properties, making the process not only extremely fast but remarkably flexible.
The full list of parameters (with potential use cases) includes:
- Exchangeable: Currencies can be exchanged all within the Nxt platform or on traditional exchanges, each identified by unique name and ticker symbols (e.g. BTC, USD).
- Controllable: Currencies may optionally only be traded with the issuing account (e.g. backed tokens such as gift vouchers).
- Reserveable: Currency units are released and distributed if funding requirements are met within the given timescale, if not funds are automatically returned (e.g. crowdfunding).
- Claimable: Reserveable units can later be exchanged at an agreed rate.
- Mintable: Currencies can be mined by proof-of-work algorithms (SHA-256, SHA-3, Scrypt and keccak), whilst still being secured by Nxt’s proof-of-stake algorithm.
- Shuffleable: Coins can be shuffled when this feature is implemented (anonymity).
- Macro implications
The Monetary System improves the distribution of wealth across the Nxt ecosystem, each currency unit possessing its own financial value.
MS also allows for the further decentralization of cyptocurrency and the wider economic landscape, achieved by:
- Importing: First generation cryptocurrencies can transition into an MS currency, allowing them to take advantage of the many powerful features of the Nxt platform and ecosystem – including the Asset Exchange, Marketplace, encrypted messaging and Alias registration, as well as a fast-growing list of third-party applications and services.
- Exporting: In the future a whole economy based on a MS currency could be transferred out of the Nxt system to another platform should the necessity arise.
Also read: Nxt [CORE]: Monetary System