Initial plan when we started the Ixian journey, was to fund our project and distribute the cryptocurrency through an ICO (Initial Coin Offering). This used to be one of the easiest and most effective methods for funding/financing blockchain startups, and for the regular users to make investments where they saw value. It is an event that usually lasts over a period of one week or more, in which everyone is allowed to purchase newly released cryptocurrencies in exchange for established cryptocurrencies.
Recently, lots of countries across the world came up with new ICO regulations. These new legislature was created as an answer to various scams and frauds which had occurred lately.
The regulation states that any projects or company, operating through ICO principles, must be registered with the relevant authorities, adding that users must also be registered as investors of the service the company or project provides.
Lots of preexisting funding is now required in order to meet the newly enacted laws, so as a small startup with limited capital, we had to choose other legal ways to present our philosophy and project to the world.
Without an ICO, it would become problematic for users and investors to obtain our newly released cryptocurrency. We discussed several methods, but always ended up with the same problem:
- If obtaining our currency is too easy, the network can be scammed or subverted and potential attackers can disrupt the service or steal from legitimate users.
- If, however, IxiCash is difficult to purchase, the adoption rate and spread of the new technology would be greatly limited.
We needed to present a way for all users to be able to participate in Ixian with minimal initial investment, but at the same time make it difficult and prohibitively expensive to join a significant number of nodes to the network and thereby subvert its operation.
To date, only one option has stood the test of time: PoW (Proof of Work). Through this method, made popular by the famous Bitcoin network, all processing nodes must calculate a difficult and time-consuming puzzle in order to validate transactions. With this restriction in place, it is very expensive to control enough computing power to harm the network’s operation.
However, PoW algorithms are very wasteful in terms of energy usage and hardware, so this is not a permanent solution. This method will be used to start the network and allow initial adopters entry without having to purchase IxiCash. In time, we expect that sufficient amounts of our cryptocurrency will be generated and available on the free market, so participating as a node in the Ixian network and using it (sending/receiving payments and communicating with friends) will become easier.
The Ixian DLT network is designed in such a way, that PoW and PoS can work side-by-side and the user is able to choose in which way to participate. This has resulted in yet another new: our Hybrid Proof system.
As more users setup their own DLT and S2 nodes, more IxiCash will be distributed, the network will become more resilient to attackers and more capable of handling large amounts of users and data while increasing privacy for all.
Once enough IxiCash is distributed, the PoW algorithm will be permanently switched off and new currency will only be generated through the much more efficient, green PoS (Proof of Stake) method.
Our team is staying highly motivated and looking forward to further cooperation.
Stay positive,
Team Ixian
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