The popularity of cryptocurrency is increasing by the minute in the economy market due to its promises of financial freedom, transparency, and security. Cryptocurrency also provides a method for transacting in countries or regions where traditional banking methods are broken or inaccessible.
The problem
The Proof-of-work algorithm adopted by Ethereum and bitcoin is however, its greatest flaw due to the scalability issues it causes. The algorithm has resulted in the emergence of mining pools that can run the energy-consuming miners with cheap electricity. Power and influence has been centralized to these mining groups and they can make changes to the network. Satoshi Nakamoto, bitcoin’s creator, had anticipated that this would be one of the greatest non-cryptographic threats also known as “51% attacks” that bitcoin would face.
The Obelisk Protocol
The Skycoin Obelisk Protocol is trying to resolve this issue by distributing the network influence through a web of trust architecture. The network consists of nodes instead of miners. The nodes are cheaper to acquire, produce, and operate. The protocol eliminates centralization since the node access has low entry barriers to entry.
Skycoin is safe from the 51% attack, as there are no mining incentives. Therefore, mining farms cannot take over the network. In the event that a group pulls its resources and tries to disrupt the network, it would be detected and shut down immediately without users being affected.
How to run the node
In order to run an Obelisk node, users will have to purchase the Skywire miner or customize their own version. Operation of the nodes does not have a monetary value it only secures the Skycoin network. Operators can earn the Skycoin (SKY) by contributing resources and bandwidth to the network. The value of the Skycoin will be determined immediately the Skywire testnet launches, which is not the case of bitcoin whose value is from speculation of future value of the network.
The cryptocurrency industry is a volatile one. However, the Obelisk Protocol and Skycoin aim at solving this problem and making blockchain scalable, fully functional, and secure.
Here are a few more views of #Synth presenting at the #Tokyo Beyond Blocks Summit in Japan earlier this month!@beyondblocks_#Skycoin $SKY #Obelisk #CryptoNews pic.twitter.com/dWRBDKAtWd
— Skycoin (@Skycoinproject) April 22, 2018
Many more updates to come in the near future from Skycoin!
