Qtum: The Best of Two Worlds
Cryptocurrency value is mostly defined by the number of people who accept and use them (volume of transactions), however, certain cryptocurrencies have functionalities embedded in the code that add to their intrinsic value. Ethereum was one of those currencies but after the DAO hack the stakeholders confidence was shaken. Qtum, short for Quantum, is a new promising ecosystem and cryptocurrency that aims to combine the best of both Bitcoin and Ethereum, while addressing the inherited problems of both blockchain ecosystems. This Bitcoin-Ethereum hybrid was founded by Patrick Dai in March of 2016 and the main focus of the project is to compete for the decentralized applications and smart contract markets, while also bringing compatibility between the existing blockchain technologies.
The Qtum project is committed to developing an open source ecosystem for the blockchain community different from that of Bitcoin and Ethereum. It utilizes a Value Transfer Protocol (VTP), to achieve the transferring of value from peer to peer and to build up a decentralized application platform. It differs from the standard Transmission Control Protocol (TCP), that is used as one of the main protocols of the internet protocol suite. This is a pioneer move on the field and, if well implemented, will support and enhance various industries such as financial services, internet of things (IoT), supply chain management, social media, and gaming.
Qtum has also expanded the scripting language of Bitcoin Core, becoming the first platform where it is possible to run smart contracts based on the unspent transaction output model(UTXO). Bitcoin’s UTXO model is incompatible with Ethereum’s model, so, not only does Qtum fix the compatibility issue between the two different blockchains, it also allows for existing Ethereum applications and smart contracts to be ported to the Qtum Blockchain. Qtum’s smart contracts, called master contracts, will run on the Qtum Virtual Machine, an alternative version of the Ethereum Virtual Machine that can be triggered by off-chain inputs. They will also include oracle and data feed functionalities. Oracles are trusted entities that make assessments about the state of the world, and the team also plans to integrate an identity module functionality, a system that requires personal information from the user in order to fulfill the compliance requirements of traditional internet and financial businesses.
All these changes result in a revolutionary Proof-of-Stake (PoS) smart contracts platform. In contrast with the Bitcoin standard, the Proof-of-Work (Pow) model, Proof of Stake isn't about mining blocks but about validating them. The validation is done through the ownership/stake of the currency, or, in other words, mining power in PoS is equivalent to the number of currency you own.
As of date, the Singapore-based project has raised over one million USD and the team’s ambitious goal is to “become the blockchain of China”. By doing this first, they can expand to other markets easily, seeing as China is currently the biggest cryptocurrency market. Qtum’s platform is expected to launch in the summer of 2017.
To learn more about Qtum, you can check out their website or read the whitepaper.
blockchain news