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Nano Cryptocurrency Explained

I have been fascinated by Crypto for a long time now, and I enjoy sharing what I have learned about it on ToughNickel.

nano-explained

What is Nano?

Nano, formerly RaiBlocks, was founded in 2015 and is a decentralised, peer-to-peer cryptocurrency, which aims to make transactions instant and free. So it is a direct competitor to currencies like Litecoin and Bitcoin Cash. But "competitor" isn't really the right word because there is no competition, Nano is far better.

Nano has multiple advantages over most other cryptocurrencies:

Fee-less

Unlike many other cryptos, Nano is fee-less. This is a major advantage to other cryptos, a Bitcoin transaction as example can get really expansive. 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 for the privilege of paying them. It could be argued that Bitcoin is a store of value, and should not be used for small transactions but it does go against the original thesis of Satoshi and is not digital cash but digital gold. Nano on the other hand could actually be used for small transactions without drawback. Even currencies like Litecoin and Dash who aim to be cheap don't offer entirely fee-less transactions.

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Instant

Nano is essentially instantaneous, as it takes less than a second to confirm the payment, and that is extremely important for small every day transactions. I recommend opening two Nano wallets and sending money back and worth to truly appreciate the speed of the network.

In 2017 Bitcoin transactions could take up to 2 hours to be confirmed. That makes BTC useless for everyday purchases. Imagine you go to the grocery store and you have to wait 2 hours for your payment to be confirmed before you can go. 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 need a few minutes to be confirmed.

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Eco-friendly

Most cryptocurrencies are being mined to secure the network but mining crypto needs 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, but this needs 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 of doing so will be insane. With Nano, thousands of transactions can happen at the same time without the insane energy consumption that we are used to seeing.

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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 is using it for all kinds of things. As 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 Pokemon 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 to the project and draws 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 possibility in the future.

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The Future of Nano

As the world moves more and more towards crypto and more and more merchants accept crypto payments there is a real demand for a technology like Nano. You can already use Dash, Bitcoin and Litecoin as a payment method at several merchants, but none of those allow free and instant transactions. Nano's eco-friendly side would also make a widespread useage possible without wasting a huge amount of electricity.

There is 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 keeps growing.

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.

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