NEM
NEM is a peer-to-peer blockchain platform for app developers. Its native cryptocurrency is the XEM. Its code was created from scratch in Java by the New Economy Movement (NEM), which seeks to build “a new economy based on the principles of financial freedom, decentralization, equality and solidarity”.
NEM Review
The project was conceived in January 2014 by the pseudonymous BitcoinTalk user UtopianFuture. The NEM blockchain, launched in March 2015, is public. NEM Foundation also runs a newer, private blockchain – Mijn.
NEM was written in Java, and a C++ version is in progress. The NEM blockchain uses an original consensus mechanism called Proof of Importance. XEM cannot be mined. The total finite sum of 8,999,999,999 XEM was distributed to stakeholders upon project launch. XEM are either bought, or earned as a reward for ‘harvesting’, i.e. processing transactions Unlike other blockchains and institutions, the NEM blockchain does not instrinsically support smart contract.
The NEM.io Foundation (led by president Lon Wong, and VP Jeff McDonald) is based in Singapore NEM is most popular in Japan.
History
The project was created in January 2014, spearheaded by the pseudonymous UtopianFuture on BitcoinTalk.org forum. UtopianFuture was inspired by NXT, but wished to improve it. The original declaration of principles and objectives of the project is in the OP, here.
Part of what motivated the creation of NEM was a perception that Bitcoin had gone mainstream. Though there were originally thoughts of forking from the NXT blockchain, creators decided to build a new code from scratch in Java.
In order to carry out a fair initial distribution of XEM, the original token – NEMstake – was distributed to users who either contributed to the project in BTC via the BitcoinTalk forums, in NXT via the NXT Asset Exchange, or contributed to the initial development and promotion of the project (with code, marketing, graphics, etc). A Sustainability Fund was “created to avoid a sizeable portion of the community distribution being under direct control of the development team as a result of unclaimed stakes. To mitigate this, a number of sub-funds would be declared with each sub-fund being allocated a percentage of the Sustainability Fund.” A detailed account of NEM’s original call to participation and stake redepmtion process is avaiable here.
NEM Foundation
The NEM Foundation was established on March 15 2017, incorporated in Singapore. The foundation is committed to working with businesses, governments and educational institutions. Its self declared purpose is to “introduce, educate, and promote the use of the NEM blockchain technology platform on an international scale to all industries and institutions.” With the NEM distributed ledger, the Foundation helps businesses to effectively store transaction, customer, and supplier data; offers governments ways to improve transparency, prevent fraud, and establish trust; and allows educational institutions to store data around assessments, degrees, and transcripts, as well as verification of knowledge transfer between parties.
New Economy Movement
The NEM movement was created to build a “new economy based on the principles of financial freedom, decentralization, equality and solidarity”.
Platform Blockchain
The NEM platform is meant to offer blockchain solutions to entrepeneurs and businesses. It is meant to be easy to use, without a need for programming. It is designed for speed and scaleability, not for secrecy, which is why it has been described as being a contender to Visa, Paypal and Mastercard rather than a project for anonymity.
NEM Exchanges
NEM (XEM) cryptocurrency is traded on most popular cryptocurrency exchanges, so there won’t be many problems to find an exchange for buying or selling the XEM tokens. Among the major exchanges thee are Upbeat, HitBTC, Bithumb, Consumer, Zaif and exchangers, such as Changelly.
NEM Wallet
The Nano Wallet, the official NEM wallet, is the safest way to store NEM coins. It is available for download on the official website of project here. It is available for desktop and mobile platforms. There are two different versions of the NEM wallet:
- Simple – it is an easy wallet version, which is convenient for beginners;
- Brain – it is an extended version on NEM wallet, may be difficult for beginners.
It should be noticed that the private key of account is created an every log in, despite the password repetition. Moreover, an additional security element of the wallet is an unique .wlt file, which is essential to login to the account.
NEM Price (XEM)
THe BitcoinWiki suggests a relevant price and market capitalization of NEM cryptocurrency on the following widget:
Popularity
NEM is especially popular in the Japanese market, said to be second only to Bitcoin. The director of NEM Japan is Zaif CEO, Takao Asayama.
Hacking attack
Approximately $545 million worth of NEM were stolen from the Tokyo-based Coincheck exchange on January 26th 2018. According to the Japan Times, the NEM Foundation “tracked stolen coins by marking accounts used for illicit transfers and urged virtual currency exchanges around the world not to process NEM payments from (them).” On March 12, the exchange announced reimbursements for the victims, some 260,000 holders.
Technical characteristics
Supply structure
The supply structure of NEM is finite with no emission. This means that the entire finite supply of 8,999,999,999 XEM was distributed to 1500 original stake holders who later distributed it within the community, at the birth of the project. Thus, XEM cannot be mined, and no inflation should be possible. NEM can be obtained in transactions with other holders, or by harvesting.
Harvesting
Harvesting in NEM is analogous to mining in blocklchains like Bitcoin. It serves the same purpose of processing transactions and creating blocks in exchange for a reward in native cryptocurrency. The significant difference between mining and harvesting is that the latter does not need any specialized, high-energy-consuming hardware.
When users broadcast transactions to the network, they pay a low transaction fee that goes towards supernodes. Supernodes are nodes that process payments on the network in order to obtain a reward in XEM (i.e. supernodes are nodes that harvest).
Users must have at least 10,000 XEM in their wallet in order to harvest, and 3 million XEM in order to become a supernode. david_hay
“For users to be eligible to harvest XEM coins, a harvester’s wallet must have at least 10,000 vested XEM coins and, with the total supply of XEM being 8,999,99,999, that means that there can be a maximum total of 899,999 accounts that have an importance score of greater than zero. In the world of NEM, a harvester is essentially a miner, receiving transaction fees upon the formation of a new block created by a harvester. An additional characteristic that exists in the NEM world, is the existence of delegated harvesting. Harvesters are able to delegate the harvesting so that a harvester continues to earn transaction fees”. Proof of Importance (PoI) is a consensus mechanism introduced by NEM as an alternative to the proof-of-work (PoW) and proof-of-stake (PoS) consensus mechanisms. It is meant to reflect how much support a user affords the network; i.e. how important a user is. Because NEM has no miners, voting power in the network is decided according to importance, measured by how many coins a user has, how many transactions have been made to and from the user’s NEM wallets, and by nodes’ reputation as reported by the Eigentrust++ algorithm (read section below). PoI is similar to PoS in that is takes into account the amount of coins a user owns. However, PoI fundamentally differs from PoS in that it also takes into account transactions and overall behavior; it rewards users who spend the coins and disincentivizes users who hoard them. This ensures that the circulation of XEM in the network stays active.
The tenant behind PoI is that users who own and spend large amounts of XEM will make decisions that benefit the development of the project for good, since raising the value of the XEM is in their own interest.
Eigentrust++
Eigentrust++ is a security clustering algorithm which monitors past behavior of nodes in the network and enables nodes to give reputation to their neighbors in clusters. It is crucial to the PoI system.
Multi-signature technology
The NEM platform has in-built multi-signature (multi-sig) contracts. They are different from Bitcoin’s multi-sig, which are not intrinsic to the blockchain but reliant on third party software.
Multi-sig contracts assign the rights and powers of one account to other accounts, turning regular accounts into multi-signature accounts. This allows groups of users to administrate the activity of an account, control assets and mosaics, or create additional contracts. A multi-sig account cannot send funds on its own but is bound by the contract and administered accordingly to the contract designated ‘cosigners’.
In an example, A and B could be two users who each have a Nano Wallet. They could sign either a multi-signature contract that gives each of them independent access to the funds in a multi-signature account (this is called a “multi-user account”), or a multi-signature contract in which any transaction needs to be approved by both of them (this is called a “multisig account”).
On the NEM bockchain, Apostille is used to notarize documents and make public timestamps.
Nem is built around the “Smart Asset System”, which allows for a customized use of the blockchain, “as if it were a custom blockchain built for (the user’s) application and assets”
Mijn
Mijn is a private blockchain for businesses that require more secrecy. It is based off of NEM technology
Catapult
Catapult is an upgrade on the Mijn blockchain. Catapult enables 4,000 transactions to be processed per second. NEM’s Catapult is the first blockchain solution to apply the private/public chain model.
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