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|White paper||Whitepaper PDF|
|Developer(s)||Brandon 'Synth' Smietana|
Skycoin is a blockchain platform. It includes Skywire, a cryptocurrency-based peer-to-peer decentralized Internet service.[unreliable source] Skycoin has been in development since 2013, and the Skywire testnet was released in May 2018.
Compared to earlier cryptocurrencies, the Skycoin ecosystem incorporates architectural differences that the creators claim improve its speed, scalability, security, flexibility and decentralization. These differences include dedicated hardware nodes, a new consensus algorithm, and the inclusion of an inflationary parallel currency that functions alongside the primary deflationary currency.[unreliable source]
The Skycoin platform has been the subject of controversy,[unreliable source] with some critics expressing concern that Skycoin is a scam.[unreliable source?] On the other hand, the Skycoin platform was recently discussed in a positive light at a United Nations blockchain conference in Geneva.[irrelevant citation][unreliable source?]
History[edit | edit source]
Company[edit | edit source]
Skycoin is a private company that provides blockchain application platforms, cryptocurrency trading and other related services.[non-primary source needed] Skycoin was founded in 2011,[unreliable source] by former Bitcoin developer Brandon 'Synth' Smietana, and the first commits to the Skycoin platform were released in 2013.[unreliable source?]
Controversies[edit | edit source]
In February and March 2018, Tristan Greene and Bryan Clark from technology website 'The Next Web' published a series of articles denouncing Skycoin as a scam.[unreliable source][unreliable source] In particular, the authors raised concerns that pre-mined cryptocurrencies are a scam, therefore Skycoin is a scam because all coins were created in the genesis block; the Skycoin whitepaper is a scam because it is unduly technical; the Skyminers are a scam because Skycoin is pre-mined and the Skyminers are expensive; and Skycoin's organizational structure lacks transparency, which they believe is also indicative of a scam.
Investors should always be cautious when investing in cryptocurrencies due to the prevalence of exit scams and other fraudulent behavior in this new and unregulated marketplace. Research shows that ICO exit scams have now cost investors nearly $100 million. To spot an exit scam, investors should carefully vet the personnel involved, be wary of unrealistic promises, ensure the project team is handling funds appropriately, and check GitHub to confirm that the project is being actively developed. [irrelevant citation]
In June 2018, Skycoin terminated its relationship with its Chinese marketing team, EVOLAB, due to alleged robbery and embezzlement of funds. According to reports, at 9:30 p.m. on June 13, nine individuals led by Skycoin's China-based marketing team forcibly entered the home of Skycoin's founder Synth and his wife, holding the couple hostage. The event was triggered after it had been discovered that EVOLAB had embezzled approximately 100,000 Skycoins over the preceding six months. During the robbery, the group extracted another 18.88 Bitcoin and 6,466 Skycoins under threat of violence.[not in citation given][unreliable source?]
United Nations conference[edit | edit source]
In May 2018, Professor Stefan Brunnhuber presented a talk to the United Nations in Geneva, in which he singled out Skycoin's Skyledger (Sky Fiber) and Obelisk platforms as a potential solution to global financial inequality and a way of easing world hunger.[irrelevant citation][unreliable source?]
Binance partnership[edit | edit source]
In October 2018, cryptocurrency exchange Binance announced an ecosystem integration with the Skycoin platform. Under the arrangement, Binance's native cryptocurrency, BNB, is to be integrated into KittyCash and all future Skycoin games and applications. BNB is to become a circulating currency on the Skywire network, with the Skycoin hardware and software wallets also supporting BNB.[non-primary source needed]
Partnership with John McAfee[edit | edit source]
Architecture[edit | edit source]
Skycoin[edit | edit source]
The supply of Skycoin is fixed at 100 million coins, and all coins were created in the genesis block. 75 million coins are timelocked and 25 million are unlocked. The timelocked coins cannot be distributed until the first 25 million have been distributed. After that, for each subsequent year, 5 million coins are unlocked by the developers.[non-primary source needed]
Skycoin transactions complete within seconds and require one Coin Hour to make a transaction. There is an anonymity feature with the use of the CoinJoin protocol which enables the platform to mix transactions from multiple wallets so they are indistinguishable from one another.[unreliable source] The platform is private so that IP addresses cannot be traced.
Coin Hours[edit | edit source]
Coin Hours are a parallel currency generated by holding Skycoins in a wallet. One Coin Hour is generated each hour for every Skycoin held. Coin Hours are also earned by running a Skyminer node. Users who run Skyminers are paid in Coin Hours for providing bandwidth, storage and computing power to other users of the network.[non-primary source needed]
Coin Hours are accumulated on the blockchain, so a wallet does not need to be open to generate Coin Hours. This is similar to the way in which the NEO (cryptocurrency) generates GAS. Coin Hours are required to make transactions on the network. Each time a transaction is made, 50% of the Coin Hours in the sending wallet are burned, and another 25% are sent to the receiver. This Coin Hour burn fee prevents transaction spam by rate-limiting the number of transactions a single entity can make. Anyone who attempts to spam the network with transactions will quickly run out of Coin Hours and must wait for another Coin Hour to be generated before making another transaction. Since Coin Hours are generated continually, and there is no maximum limit to the number of Coin Hours in existence, this mean Coin Hours are an inflationary currency.[non-primary source needed]
Skyminers[edit | edit source]
Skyminers are the hardware nodes that form Skycoin's decentralized Internet service. They don't mine coins in the traditional sense. Instead the Skyminer nodes are rewarded with payment in Coin Hours for providing services to other users, rather than for solving complex math puzzles as is the case with Bitcoin and other Proof of Work cryptocurrencies. Services provided by Skyminer nodes includes providing bandwidth, storage and computing power to users of the network. [unreliable source?] Skyminers may be purchased directly from Skycoin, or they may be built using commonly available components by following one of several online DIY guides.[non-primary source needed] Skycoin chose this approach to avoid the centralization of mining pools that has occurred with Bitcoin, Ethereum and other cryptocurrencies.[irrelevant citation][unreliable source?] There were 8560 Skyminer nodes deployed globally as of October 2018.
Skywire[edit | edit source]
Skywire is a blockchain-based network consisting of Skyminer nodes that can connect to each other in a peer-to-peer manner via wireless, radio, satellite, optical fiber or ISP links. These nodes are used for the forwarding and routing of traffic, creating a decentralized Internet.[unreliable source?] This Skywire mesh network uses Multi-Protocol Label Switching rather than TCP/IP for transport. MPLS routes are predetermined and each node can only see the previous node and the next hop for the data packet. This is more secure and private than the IPV4 and IPV6 protocols, in which anyone can view the origin and the destination of the data.
Skycoin Fiber[edit | edit source]
Skycoin Fiber was originally known as Skyledger.[non-primary source needed] Skycoin Fiber is a blockchain platform that enables other projects to launch their own decentralized applications, similar to the way in which Ethereum enables other projects to launch ERC20 tokens and Initial Coin Offerings. The key difference is that Skycoin’s Fiber architecture gives each project its own dedicated blockchain, wallet and coin, rather than sharing a single blockchain.[non-primary source needed] This architecture ensures that congestion on one blockchain does not impact applications on other blockchains, as occurred in 2017 on the Ethereum platform when the CryptoKitties application caused all other Ethereum applications to slow down.[irrelevant citation]
Obelisk[edit | edit source]
Skycoin’s consensus algorithm is called Obelisk. The Obelisk protocol distributes network influence through a 'web of trust' architecture and does not require any form of coin mining. Each Skyminer node has a list of other nodes that it subscribes to. The density of a node’s network of subscribers determines its influence on the network. This approach removes any incentive for centralization of consensus nodes and eliminates the risk of a 51% attack or majority attack.  
References[edit | edit source]
- "11 CEOs and founders on whether cryptocurrencies will be mainstream in 2019". CNBC. 31 May 2018.
- "Obelisk: The Skycoin Consensus Algorithm". Skycoin Blog. 2017-09-08. Retrieved 2018-10-16.
- "Skycoin Launches A Vision for the New Internet". Richard Kastelein. August 2017.
- "Skycoin: A Safe and Secure Blockchain Adoption Platform". SludgeFeed. 2018-06-12.
- "Skycoin: Anatomy of a cryptocurrency scam". The Next Web. 2018-02-15.
- "ICO Exit Scams Have Stolen Nearly $100 Million: Research". CCN.com.
- "UN Talk: Blockchain - Financing the Future - Sustainability - SDG's, Prof. Dr. Dr. Stefan Brunnhuber". United Nations. 21 May 2018. (Skycoin technology is discussed at 9:50, 14:20 and 17:30 in the referenced video)
- "Skycoin Company". Bloomberg L.P.
- "Skycoin - A Beginners Guide Project". CoinCentral. 2018-04-04.
- "We suspected this shady cryptocurrency project was a scam. Now we're sure of it". The Next Web. 2018-03-08.
- "How to Spot an Exit Scam: 4 Ways to Identify a Phony ICO". Entrepreneur.com.
- "Skycoin's Chinese Marketing Team Accused of Robbery And Crypto Embezzlement". China Money Network. 19 June 2018.
- "Skycoin Freezes Funds After Staff Take CEO Hostage And Steal 18 BTC". Bitcoinist. 19 June 2018.
- "Skycoin and Binance: A Strategic Cooperation Agreement". Skycoin.
- "McAfee hops on board with SkyCoin". Chepicaps.
- "Past and Future Distribution of Skycoin". Christian Ott. 2018-03-23.
- "Coin Hours - Parallel Currency of Skycoin". Christian Ott. 2018-03-14.
- "Even Though Bitcoin Wastes Power, Blockchain Can Be Sustainable". Sustainable Brands.
- "Skycoin: A D.I.Y Miners Guide". Steemit. April 2018.
- "Bitcoin and Ethereum have a hidden power structure and it's just been revealed". MIT Technology Review. 18 Jan 2018.
- "Understanding Skycoin cryptocurrency". Forex News Now. 24 May 2018.
- "Network node list". Skywire Node Status.
- "How Skycoin is Set to Revolutionize the Internet". ZYCrypto. 21 Jan 2018.
- "Skycoin Fiber - Blockchain Platform for Applications". Christian Ott. April 2018.
- "Complete Overview of Skycoin: The Greatest Threat to ISPs". CoinBureau. 2018-04-12.
- "CryptoKitties craze slows down transactions on Ethereum". BBC News. 8 January 2018.
- "NASDAQ TradeTalks: Decentralized Internet". Nasdaq, Inc. 21 May 2018.
- "Solar Bankers: Part of the Skycoin Ecosystem". Solar Bankers.
- "The Blockchain Protocol That Puts the Technology back on Track". Inside Bitcoins. 16 June 2018.
- "Skycoin Obelisk Protocol Review: Blockchain Consensus Algorithm?". Bitcoin Exchange Guide. May 2018.
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