Verium Reserve and VeriCoin balance interests between the miner and the consumer in order to retain decentralized mining and low transaction fees.
As the Yin and Yang of world finance are continually pushed into the ring with cryptocurrency, innovation will ultimately prevail as the differentiator of value. The crypto world exists in this middle ground between countries, between banks, between individuals. All parties are necessary to enhance the decentralized ideal that crypto purports.
There seems to be an over-arching financial shift that is becoming more apparent every day. For those in the crypto world this has been apparent for some time which is why you’re seeing their innovations create billion dollar industries. While certain aspects of the financial system push against crypto currency, others are embracing it outright and still more are investing behind the scenes.
Douglas Pike, founder and creator of Verium Reserve and VeriCoin says “We believe that speed and costlessness [are] the two key ingredients for getting users in the long-run, that’s what’s going to win.” Pike’s perspective on the crypto world is unique, logical, and inspiring. At the core of his beliefs is the mindset that keeping transactions fast and affordable will be why crypto is widely adopted as currency – the actual use of cryptocurrency being a core tenant of that frame of thinking. And, as such, is core to the inception of his company.
Pike’s concept embraces that which is core to cryptocurrency’s success – a return to the commodity/currency model that we can most closely relate to another limited entity like gold. While dollars, or any other currency not backed by a commodity, holds value, they only do so as a means of exchange, not because they have functional applications. In other words, currency today is void of the commodity-based model that persisted over the last several millennia.
Crypto-currency puts a digital spin on that model, returning the commoditized aspect of currency exchange – most easily defined in it’s limited quantity, expounded on by the function of the blockchain. In essence the security functions of protecting the currency become commoditized, helping to add stable value and balance to the currency.
Douglas Pike makes the point that low transaction fees and access to mining for the every day person and computer system are what will keep cryptocurrency going in the right direction. This will also create a beacon for the financial system – void of control, saturated with security – that we all hope to see in the near future. Verium and Veritas are his Yin and Yang that hope to move the needle.
Verium is a proof of work and VeriCoin is a proof of stake, so you can mine Verium and transfer it into VeriCoin and then stake your coins to collect interest.
Verium is a digital commodity that is slower and has the burden of higher transaction fees. The goal of it is to bring as much security as possible by paying for the security in the P2P network (miners).
VeriCoin, however, is the digital currency with a focus on speed and nominally low transaction fees.
The proof system is the security, you want to have the system pay itself and pay itself well to encourage more security. Pay miners well with Verium that is a low-supply currency with higher value per coin – a 10x supply parody with VeriCoin, purposefully designed in order to keep inflation down. This inherently increases the value of Verium in relation to VeriCoin.
Separating the two entities into their own co-dependent blockchains is called binary chain and separates the mined entity from the cryptocurrency itself while maintaining all data on the blockchain. In the case of Verium, Vericoin ultimately is designed for consumer transactions between individuals with a very low transaction fee and Verium is a digital reserve.
As the mined commodity, Verium is near impossible to mine with a GPU or ASIC. On the other hand, it is specifically designed to be done with CPUs. This helps to further decentralize the market and retain larger pools of miners around the world, since more people have access to personal computers capable of mining the currency.
The decentralization encouraged by Pike’s model is an ideal long encouraged by Bitcoin and the entire crypto market. When it’s required to have a large bankroll in order to mine a currency then smaller groups of people will get involved. It’s akin to the way large gold-mining operations who spread and averaged their cost of operations were able to overtake the individual miners. The same thing has happened with the Bitcoin mining ecosystem. Since the miners help bring security to the network then there should be concern that a handful of large groups have a lot of influence over it.
This, of course, is exactly what cryptocurrency is actively working against. Binary chain solves a crucial aspect of this shift and maintaining accessibility for more miners solves another. Fortunately there are many companies out there pushing crypto technology forward in a way that will encourage decentralization at a more rapid rate. Because, as we know, the existing entities will try to control their environment as much as they can and unfortunately not always with the every day consumer at the heart of their purpose.
Verium has taken an important step. However, these technological advancements are a far cry from being understood and adopted. The hard work to overhaul the financial system, to empower the individual, goes unnoticed in the wake of the limelight. Headlines like “Bitcoin Tanks After China Ban” or “Bitcoin to Reach $50,000 by 2018” control the mass-media perception of the next major digital advancement of our time. Finding the solutions and believing in the technological innovations should encourage an avoidance of the fear, uncertainty, and doubt. Instead it should encourage action as innovators, investors, and individuals.
Ross Ruffing, lead writer @ Crypto 101