What is a Coin Migration and What to Expect
Energi (NRG) runs on its own blockchain. It’s core fundamentals were forked from Dash and have been enhanced to become a cryptocurrency with one of the largest treasury model’s in the space. We’ve seen Energi quickly become a top 100 cryptocurrency within a little over a year of its mainnet launch, and yet we are only scratching the surface of Energi’s true capabilities.
Energi will breakthrough yet another huge milestone with the launch of Energi 3.0. In Q4 2019, Energi will fully transition to an Ethereum-based smart contract platform, compatible with Decentralized Applications (dApps) written for Ethereum. Energi will not be turned into an ERC20 token, but rather be an equivalent to ETH, with the ability to have ERC20 tokens compatible with our platform. This major update will encompass all of Ethereum’s capabilities while incorporating Energi’s Treasury, Masternodes, and Governance systems, all on one blockchain.
What is a Coin Migration?
Since blockchains are immutable distributed ledgers, it’s impossible to modify a cryptocurrency without migrating it to another blockchain. As such, the process of introducing Energi 3.0, Energi will need to move onto a blockchain that possesses smart contract capabilities. This is where the term Coin Migration is introduced. Coin Migration is a process where a cryptocurrency is moved from one blockchain to another. Energi will move from a Bitcoin-based blockchain (since Energi is based on Dash, Dash was based on Bitcoin) to an Ethereum-based blockchain.
Unlike a traditional coin swap (further information on this is provided below), Energi will perform a coin migration from Generation 2.0 to 3.0 which will be a seamless, trustless, and decentralized method that will transfer NRG to a native Ethereum-like address (Ethereum addresses are a sequence of 20 characters that typically start with 0x) with a new private key. For Energi’s coin migration, there will be a snapshot taken of all Generation 2.0 blockchain UTXOs. This snapshot will then be embedded in the Generation 3.0 Genesis block.
In order to make the Energi Coin Migration possible, the Energi Generation 2.0 snapshot data must be captured before Energi 3.0 goes live. Once Generation 3.0 goes ‘live’, users will be able to use the Generation 3.0 wallet and ‘unlock’ their NRG (same amount) using their Gen 2.0 private keys.
How Traditional Coin Swaps Work
Within the cryptosphere, there are a number of methods that are employed to execute a coin swap. There are similarities that can be observed across them all. From a user’s perspective, their involvement in the process will vary, based on where their coins are stored (i.e. exchange or a hard wallet).
Some cryptocurrency projects give their users a ‘hard’ deadline for when they must swap their old coins for the new one. Failure to do so results in users’ old coins being frozen or inaccessible. If users’ coins are left on exchanges, some exchanges put a halt on trading the cryptocurrency until the migration to the new coin is complete. While other exchanges may take an entirely different approach and prepare in advance. Typically, exchanges notify users in advance that trading services for that cryptocurrency will be going into ‘maintenance mode’.
Whether you leave your coins on an exchange or do the coin swap yourself, you should understand the processes of traditional coin swaps, know what the coin swap deadline is, and understand the consequences of missing it. Thankfully, Energi has no such ‘hard’ deadline.
The Energi Coin Migration Alternative
Rather than depending on an exchange or a third-party wallet to perform the coin migration, Energi will provide everyone an equal opportunity to migrate their coins at ANY time, on the condition that their NRG is stored on the Energi Core Wallet. Before Energi 3.0 is released, Energi holders will be notified well in advance of the coin migration and will be provided instructional steps so that they are fully prepared.
Energi holders with Masternodes will need to set up new Energi Masternodes. To make sure Masternode holders have a smooth transition, we will add a special ERC20 token which will be used as collateral. As for holders who are staking NRG, there will be no changes. We will provide more information on what to do with your Masternodes as we get closer to the launch of 3.0.
Regardless of whether Energi coins are stored on the Energi Core Wallet, on an exchange, in the Energi Rain Wallet or Coinomi, users will be given a specific set of instructions for how to proceed in their situation, well ahead of the migration.
Why Coin Migration Instead of Coin Swap?
Some potential risks that coin swaps bring to users are missing deadlines of exchanging their old coins for new ones, exchanges not performing the coin swaps for holders and the risk of losing coins. Missing a ‘coin swap deadline’ and failing to exchange old coins for new, with the consequence of losing those coins forever, or the stress of resolving this with the core team, over a prolonged period, is not an acceptable outcome for any of our Energi users. Nor is the risk of exchanges not performing the coin swap for their NRG holders within a specified deadline. So we designed things differently.
Energi is taking an approach that will require little effort from our users and also provide peace of mind. NRG holders won’t need to worry about potentially missing deadlines, having their coins frozen on an exchange, or most importantly, losing their coins entirely.
We understand that ‘coin swaps’ and ‘coin migrations’ can be a concern for users. We have focused our efforts on making this coin migration as stress-free as it possibly can be. The migration will allow Energi to move forward into its new evolution; Energi 3.0, without having to worry about the past. This will allow Energi to enhance its capabilities and attract a new audience with the growth of our dApp platform.
Developers can utilize Energi’s smart contract platform to continue work on their dApps written in Solidity or any other language on top of EVM (Ethereum Virtual Machine), whilst benefiting from Energi’s Defense Team and Energi’s Incubator Lab which will include technical and marketing support.
