NEM has been in the headlines recently because of repeated hits to their value, dropping below $0.54 in February. That grim picture doesn't convey a complete story, however, as NEM had been making serious strides at the beginning of 2018, and the so-called "smart asset blockchain" still has plenty going for it. Launched in 2015 by pseudonymous developers, NEM is a peer-to-peer cryptocurrency and blockchain platform. It was originally conceived as a fork of NXT, but then reworked as a completely new network, one with enterprise-grade solutions designed to set it apart from other altcoins and introduce innovations that would allow it to compete in a decentralized future fraught with rival currencies.
Among these innovations are the proof-of-importance algorithm, multi-signature accounts, encrypted messaging and the Eigentrust ++ reputation system. The multitude of features have generated plenty of interest in the platform, and with its incorporation into the Mijin commercial blockchain, NEM saw some significant growth heading into 2018. At present, NEM's market cap is around $4,547,231,999, or 390,104 BTC. The value currently rests at about $0.505248, with a 24-hour volume around $73,120,400 and a circulating supply of 8,999,999,999 XEM.
NEM: Competition, Pros and Cons
One of the key features that sets NEM apart from other blockchain platforms is their Smart Asset System. The idea is to provide a customizable and open blockchain that allows users to fine-tune how they use the platform. As NEM puts it:
"Focus on building exactly what you need, whether that's a fintech system, tracking logistics, an ICO, document notarization, decentralized authentication or much more."
The blockchain contains a Namespace, which defines a user's "home" on the blockchain. In these spaces, users can create Mosaics, which NEM calls the "basic building blocks of Smart Assets." Mosaics provide "easy-to-remember names to user addresses" and other details, and can be used to represent whatever the user decides: signatures, coins, status updates, etc.
The Smart Asset System goes deeper than this, though. It also allows users to create "Addresses," which then serve as containers for Mosaics and can be connected with Multisig rules. The address can be a user, a unique asset or other variables that users define, which they can then update or change through configurable Transactions. The system allows for a great deal of flexibility, allowing just about anyone to construct whatever system they dream up, then link it to the NEM blockchain in a simple manner.
The Proof-of-Importance algorithm touched on earlier is another interesting facet that NEM's system includes. It differs from the commonly used Proof-of-Work and Proof-of-Stake algorithms, creating consensus by way of incentivizing participation in the NEM platform:
"Each account is assigned an importance score that proxies its aggregate importance in the NEM economy. Accounts with higher importance scores have higher probabilities of harvesting a block. Because all transactions are publicly available in NEM, the transaction graph of the NEM economy can be calculated exactly."
Nodes have "importance scores," which dictate how often they may harvest (akin to mining in the POW system), and, over time, the coins "vested" in a user's wallet contribute to their importance score. Accounts must have at least 10,000 vested XEM to be eligible for an importance score. The more transactions a user sends through the network and the more a user participates in the network on a regular basis, the more important they become.
This creates a platform where an investment of time is required, and users are unable to game the system simply by having more resources than another at the outset, as can happen in some Proof-of-Work scenarios. It's not the only advantage that NEM touts, however. On their website, they list four main areas in which they believe they outpace competitors: performance, ease-of-development, customization and security.
NEM claims to have coded their blockchain platform "from the ground up" to enhance scale and speed, using a "permissioned private blockchain" to give users faster transaction rates for the internal ledger. Ease-of-development and customization come by way of the Smart Asset System, which, instead of requiring users to develop smart contract code from scratch or use "off-blockchain" techniques for defining custom assets, provides "direct API access to a specialized set of tested and secure on-blockchain features." Finally, the security features of NEM's platform include built-in spam filters, encrypted messaging, P2P time synchronization and multi-signature addresses, among other details, all of which are discussed on the company's technology page.
Although NEM has suffered from a sharp rise and dramatic fall early in 2018, that's not enough to count out its technology as a mere fad. Values are volatile, but the support behind the community and their blockchain vision is still going strong at the moment.
Uses of NEM
NEM outlines several use cases for their platform on their site, stating that the Smart Asset System can be put to work to build "an incredible variety of real-world applications" for businesses. Among these, they list facilitating financial payments, creating new cryptocurrencies (sans programming), enabling mobile payments, overhauling equity markets to save money and improve efficiency, creating escrow services, use as a liquid asset, and creating new versions of payment applications like PayPal.
The Future for NEM
NEM is still investing in their future by way of improvements to the platform and the expansion of their global adoption. Their current focus is on the Japanese market, with periphery focus on other international markets. President of the NEM Foundation, Jeff McDonald, has been hard at work representing the platform publicly at speaking events, such as a recent presentation at the University of California Irvine.
Sources:
- https://coinmarketcap.com/currencies/nem/
- https://nem.io/
- https://nemflash.io/
- https://nemflash.io/nem-xem-listed-binance-reveals-plans/
- https://www.eventbrite.com/e/blockchain-at-uci-blockchain-pr-present-enterprise-solutions-with-the-nem-blockchain-tickets-43072728691
- https://nem.io/technology/
- https://nem.io/wp-content/themes/nem/files/NEM_techRef.pdf
- https://coincentral.com/what-is-nem/
- https://steemit.com/altcoins/@vincent4384/is-nem-really-the-sleeping-giant
- https://themerkle.com/nem-price-keeps-taking-hits-as-value-drops-below-0-54/