How Does Nano Work?

Like all cryptocurrencies, Nano uses a consensus algorithm to keep the node network in sync to prevent users from breaking software rules. More specifically, Nano uses a proof of delegate (DPoS) variation called Open Representative Voting.

Under this system, nodes are assigned a “vote weight” according to their account balance. They can then choose to cast or share their vote on another node in the network.

When a node has sufficient voting weight, it is appointed as the Lead Representative and can vote on transactions in proportion to the funds in its account and those allocated to it.

Representatives are not paid to vote on which transactions and blocks the network has to accept.

What is the Block Lattice?

Nano’s main innovation is a new data architecture called Block Lattice.

Under this design, each account has its own blockchain, allowing users to update their accounts instantly without waiting for the rest of the network. These independent blockchains are called “account chains”.

Similar to your bank account, each block in the cage records and updates the status of an account. Therefore, transaction amounts are interpreted as the difference in account balance between consecutive blocks.

Each transaction is its own block, and each block replaces the previous one in the account.

Users can send and update blocks without using the entire network. Additionally, only account holders can change blockchains.

Operations in nano occur in the following cases:

The sender publishes a block debiting their account for the amount to be sent.

The receiver publishes a matching block charging their own account.

Each block in nano also contains a small proof-of-work component used to deter spam transactions. This is done to prevent users from constantly sending transactions.

Why Does NANO Have Value?

Nano shares many of the features that value all cryptocurrencies, including durability, portability, and scarcity. Nano’s maximum resource is 133,348,297 NANO.

From 2015 to 2017, the NANO cryptocurrency was distributed through an online tap system that allowed anyone to complete a captcha and claim it for free.

During this period, a total of 126,248,297 NANO was distributed with fittings.

In October 2017, 207 million NANOs were put into circulation, sent to an address with a private key that is said to have been destroyed. This means that no NANO coins can be minted by the protocol, which is a possible feature for investors who can be sure they are purchasing a finite commodity.

However, since no new cryptocurrency is allocated to nodes, there may be fewer opportunities for tech-savvy users to monetize their ecosystem by providing services.

Stay tuned to SinceCoin to learn more about Bitcoin and cryptocurrencies.

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