Part 4 — — The building blocks behind Ormeus, ORME and ORV
by Taaz Gill
(Unlocking The Crypto Puzzle is an ongoing series of articles to help demystify for everyone.)
In previous chapters of Unlocking The Crypto Puzzle, we’ve looked at how works, what is, and how you can protect your . In this chapter, we’re going to give you a fairly simple guide to — how it works, why it’s different from , and why so many people are interested in it.
As we build the Unlocking The Crypto Puzzle story, we will assume you have read the previous chapters on and . If you feel you don’t really understand those subjects, just click on the highlighted links and read those before jumping into .
What is ?
It’s a coin, like , right? Well, yes and no. It’s a digital coin, or rather Ether, the coin associated with the , is a coin. And yes, like , it can be bought and sold on exchanges. But when you peek underneath the covers, is so much more.
is an open-source (think free to the public), -based platform. Like the used in , it uses a decentralized system to create a type of public of all transactions on the .
But the was created for one purpose — to create a direct, peer to peer, system for the transaction of (electronic cash). It was essentially designed as a way to pay for goods, merchandise or services without a middleman (banks) getting in the way (and charging fees for their service). And that is the only purpose the serves — the transaction of .
When others saw what could do with , they wanted to create their own application or coin. That meant they had to build their own . And that was a difficult challenge, to say the least. Each coin, each program, had its own and had to create the mechanism to make them work.
The network was created to provide a platform to simplify the process. It created a system others could use to create their own network. Prior to , creating a was incredibly complicated — even for crypto geeks. They had to know a multitude of skillsets like coding and cryptography. And it was not an inexpensive undertaking. The network simplified all that, and has been the building block for hundreds of new applications, including Ormeus and OMC.
Think of as the foundation of a building. It provides the structure, the technology, and then invites other developers to build their own decentralized applications on the existing foundation.
Does Take Place in the System?
Yes… but differently. Instead of for , like the , miners earn Ether, which is the crypto created to power the network. And it serves two purposes — it is a tradeable , like , but it is also used by application developers, those guys building new applications on the foundation, to pay for transaction fees and services. Among the real advantages of the is speed of transaction — where is block time is 14 to 15 seconds versus ’s 10 minutes. Also, the fees are reasonable — according to CNBC, in December 2017 the average transaction fee was US$0.33 compared to ’s US$23.00.
There is another type of that is also used in the System — Gas.
Gas is a system of pricing and payment that is used to run a transaction on . If the network were a car, then the coin Ether is the fuel that powers the car. And every time you drive your car — send , engage a contract, or really do anything on the , you pay for that computation. The amount of the payment is calculated in a called Gas. And yes, Gas is paid for in Ether. But as mentioned earlier, the cost of a transaction fee on the is very low.
Why do they need Gas? Gas is the motivator for miners to perform the computations that protect the . It pays for the system to function smoothly.
What is a Smart Contract?
Smart contracts are self-executing contracts that exist on a network. Think of it like a safe — locked by cryptography — that has value locked inside. But it can only be opened once both parties meet all pre-agreed conditions. They can be used to enact any type of enforceable agreement — buy and sell property, services, basically anything that has value. Similar to how the removes the middleman (banks) in the exchange of currency, smart contracts also remove the middleman — Attorneys or anyone who gets paid to facilitate a contract agreement.
At its simplest description, it’s a self-operating contract that executes and handles all parts of the transaction — payment, management and enforcement. And it can be designed so that it only executes the transaction when a specific set of conditions are met. And since it’s a transaction, it’s protected from fraud, manipulation, or any kind of outside interference. It’s a revolutionary technological achievement, and has already created massive changes in the way business is done throughout the world… and it’s still in its infancy.
What Else Can It Do?
There are a multitude of decentralized applications, known as DAPPS, already being used to perform functions that used to require third-party interaction. Imagine cutting out lawyers, bankers, notaries, registering for voting, the driver’s license board… the possibilities are endless.
is also used to create Decentralized Autonomous Organizations, or DAOs. A DAO has no central leader or management structure. They are run by programming code and smart contracts. Basically, the code replaces the structure of a traditional organization. A DAO is owned by everyone who purchases , which give people voting rights in the organization. One of the most famous examples was created to provide venture capital funding. It was called “The DAO” and was launched in 2016. It allows its members to vote and decide where to invest their venture capital. It also controls such things as reinvestment and profit dispersion, all through smart contracts.
The Future of and its impact on Ormeus.
At this point, barely 10 years into the advent of , it’s hard to say for sure if will be the final building block that leads crypto towards worldwide mass acceptance. It continues to grow and adapt, with 4 version changes having been accepted since its creation and more in the planning stages. It is adaptability such as this, that could allow to continue as the creation platform of choice in the future.
The was chosen by Ormeus in the creation of its ERC-20 compliant coin, ORME, as well as the company’s Ormeus Reserve Vault (ORV). With still in its infancy, it’s clear that and its unique platform are playing a vital role in the growth of this new technology.
Published at Fri, 22 Feb 2019 18:59:59 +0000
