Saturday, October 9, 2021

KnowYourCrypto #30 - Nano (NANO)

If you are interested to the previous posts of this series, check it out here:

What is it?

"Nano is a digital payment protocol designed to be accessible and lightweight, with a focus on removing inefficiencies present in other cryptocurrencies. With ultrafast transactions and zero fees on a secure, green and decentralized network, this makes Nano ideal for everyday transactions"

This definition comes from the official NANO's official site, but I truly believe there isn't a better way to explain what NANO is.

Fun fact: NANO's network requires so little energy that it could be powered by a single wind turbine

How does it work?

Nano is a blockchain cryptocurrency that allows users to move money quickly. It competes very well with Bitcoin and other popular cryptocurrencies because its design keeps it safe from the problems faced by its competitors, such as centralization of power, high energy requirements, high transaction latencies, etc... Like IOTA, Nano uses its block tracking technique instead of the typical blockchain network that Bitcoin and most other coins use. Block-lattice works similarly to IOTA's Tangle, but there are some differences. In Nano's block lattice, each user account has a blockchain. These blockchains are responsible for maintaining the records of user accounts, while the main blockchain only holds a record of these ledgers. This not only eliminates the high storage requirement of blockchain ledgers, as in the case of Bitcoin, but also improves transaction times. With Block-Lattice the sender sends NANO tokens and signs his block. The last block in its blockchain has an account balance record. The sender signs the new block and waits for the receiver to do the same. The recipient signs the block on receiving the funds and their blockchain is updated with the new balance. Since the funds are sent in UDP (User Datagram Protocol) packets, both parties do not need to be online at the same time, and thousands of transactions can take place at the same time. The fact that only account balances are recorded and not the entire transaction history also improves the load on the blockchain for storage. There is no obligation for miners as users verify transactions directly. In the event of a conflict, the nodes with the right to vote - the result of using the delegated Proof of Stake - resolve the transaction.

Where to store it?

The best hot wallets for NANO are Exodus, WeNano, TrustWallet and Atomic Wallet. If you want more security, a cold storage like Ledger or Trezor is the right choice.

Pros&Cons

*DISCLAIMER* These lists are subjective, it depends from person to person

Pros

  1. No transaction fees
  2. Fast transactions
  3. Environmentally friendly (carbon negative network)
  4. Decentralized network
  5. Scalable

Cons

  1. Slow adoption
  2. It doesn't support Smart Contracts

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