I have been fascinated by crypto for a long time now, and I enjoy sharing what I have learned about it on ToughNickel.
What Is Nano?
Nano, formerly RaiBlocks, was founded in 2015 and is a decentralised, peer-to-peer cryptocurrency that aims to make transactions instant and free. It is a direct competitor to currencies like Litecoin and Bitcoin Cash, but "competitor" isn't really the right word because other crypto projects can't yet match Nano's speed and lack of fees.
What Are Nano's Advantages Over Other Cryptocurrencies?
Nano has multiple advantages over most other cryptocurrencies. The following are some of the most important.
There Are No Transaction Fees
Unlike many other cryptos, Nano is feeless. This is a major advantage over other cryptos. A Bitcoin transaction, for example, can get really expensive. In 2017, a Bitcoin transaction could cost over $40. This is a major drawback for small, everyday transactions. Imagine buying something at the grocery store and having to pay an additional $40 just to have your payment processed.
It could be argued that Bitcoin is a store of value and should not be used for small transactions, but this does go against Satoshi's original intent. With high transaction fees, Bitcoin is less like digital cash and more like digital gold. Nano, on the other hand, could actually be used for small transactions without drawbacks. Even currencies like Litecoin and Dash—which both aim to be cheap—don't yet offer entirely feeless transactions.
Payments Are Processed Instantly
Nano is essentially instantaneous, as it takes less than a second to confirm a payment. This sort of speed is extremely important for small, everyday transactions. I recommend opening two Nano wallets and sending money back and forth to truly appreciate the speed of the network.
In 2017, Bitcoin transactions could take up to two hours to be confirmed. That makes BTC useless for everyday purchases. Imagine going to the grocery store and having to wait two hours for your payment to be confirmed before you could leave.
Again, Bitcoin doesn't work as digital cash—only as digital gold. But even Nano's direct competitors cannot compete with instant confirmation. Litecoin and Dash transactions both need a few minutes to be confirmed.
It's More Eco-friendly Than Its Alternatives
Most cryptocurrencies are mined to secure the network, but mining crypto requires a lot of electricity. Nano doesn't need miners to process payments because it doesn't work with a proof-of-work protocol. It works with an efficient protocol called "Open Representative Voting." I won't explain the technical gibberish behind it in this article, but I will say that it uses far less energy than mining or even staking crypto.
I think this is a huge point that many people overlook. With the rise of Bitcoin, more and more power is dedicated to mining and processing transactions, and at a certain point, the cost becomes impractical. With Nano, thousands of transactions can happen at the same time without the energy consumption that we are used to seeing with other cryptos.
The Nano Community
Because it is free and high speed, Nano has a dedicated community behind it. Most crypto holders wouldn't want to donate BTC to somebody on the internet—like to a content creator, for example—because they would have to send rather high amounts of BTC to exceed the fees. Nano doesn't have that problem, which makes people more willing to send smaller amounts of it to each other.
Because of that advantage, the Nano community uses the currency for all kinds of things. For example, similar to how Bitcoin was used for online gambling, you can now play games like Quake online and earn Nano for each kill. Or you can get Nano by playing a game similar to Pokémon Go for Android and iOS called WeNano. Of course, you can only earn peanuts and not a liveable wage that way, but it is fun nonetheless.
This may sound kind of weird, but it makes the community very active and supportive of the project and helps draw attention to Nano. Such active use of small transactions also proves that Nano works well for what it is intended for and that real-life adoption is a serious possibility for the future.
The Future of Nano
As the world moves more and more toward crypto and more and more merchants begin to accept crypto payments, the real demand for a technology like Nano grows. You can already use Dash, Bitcoin and Litecoin as payment methods at several merchants, but none allow free and instant transactions. Nano's eco-friendly side would also make widespread usage possible without wasting a huge amount of electricity.
There are no guarantees in the crypto world, but Nano has at least a realistic chance of becoming a "normal" currency that people use for everyday payments. For now, the number of Nano users continues to grow.
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.