Nano | $NANO | In Block Lattice We Trust!

Hey, guys!

So as some of you may know,
I previously covered
IOTA in a video.

And I was surprised to find
out that the community

didn't seem to like the
review, even though

I thought my information
was unbiased and honest.

And around the same time a
project called RaiBlocks,

which is now NANO, was
catching a lot of traction.

That caught my eye,
because I was interested

in the DAG technology
as it relates to possibly

hedging blockchain tech,
but I liked the fact that

NANO used the DAG tech in a
different capacity than IOTA did.

So in this video, as the title
has already explained to you,

I will be covering NANO.

I already mentioned briefly
that it was called RaiBlocks,

but I just want to say
that it's been officially

rebranded and is now
called NANO completely.

So let's get into
a little history.

Colin LeMahieu is the
founder of the project

NANO and also the
lead developer.

The original whitepaper
and also the first beta

implementation of the
project were published
in December of 2014.

Surprisingly enough,
that means it's one of the

first cryptocurrencies
to start using DAG tech.

Other notable ones are
Byteball and IOTA,

but I'll get into
that in a little bit.

That fact stuck out to me
a lot because it felt like

RaiBlocks, or NANO,
seemingly came out of nowhere.

And to know that the project
had been around since 2014

just sparked my
interest a lot more.

During the time
the network was live

after the genesis
of the project,

it had very little
development going on.

It also ran into a few
technical issues.

At one point,
Colin actually stopped

working on development
for personal reasons.

Then around 2016 - 2017,
people from the community

started to band together to try
to push the project forward.

And that's actually how the
NANO faucet came about.

A community member proposed
this idea because they thought

it would be a good way
to distribute RaiBlocks

at the time to everyone
with low liability.

He also volunteered
to manage it.

At that point, development
just started to pick back up

and there's contributors
who have been joining
more rapidly ever since.

That brings us to present day
where we've seen this rapid

momentum and growth
that's come out of NANO.

Let's talk about
distribution a little bit.

So unlike a lot of
other projects,

NANO did not run an ICO.

The original distribution
was performed by using an

online mining mechanism,
or what's called a faucet.

Essentially it was just a
website you would go to,

you would complete a Captcha,
and then you would receive

a small amount of the
coin as a reward.

Faucets were really popular
during the genesis of the
cryptocurrency movement.

It gave people a way to get
involved in the project,

and have a little bit of the
project without any liability

or any of those pesky Know
Your Customer requirements.

When NANO started it was premined
and all the available coins
were kept in a genesis wallet.

And the private key for that
genesis wallet was kept

in a safety deposit box
that was held by Colin.

Then as distribution by
the faucet continued,

he would occasionally have to
go to the safety deposit box,

take out the private key,
send a transaction to the

landing wallet so that he
could fund the faucet,

and then he would put the private
key back in the safety deposit box.

The faucet actually managed
to reach a lot of people.

The team estimates somewhere
in the range of 330,000
accounts accessed the faucet.

Those accounts were hailing mostly
out of countries like Venezuela,
The Philippines, and Korea.

The faucet became very popular,
for good reason, and unfortunately

like all good things it
must come to an end.

There was a lot of issues
with people accumulating

NANO off the faucet and then
immediately going
to an exchange and selling it.

They were putting a lot of
sell pressure on the exchanges,
and this was suppressing the price.

Not to mention, there were endless
attempts to hack the faucet which meant

the developers of NANO,
instead of appropriately spending
their time working on the project,

they were focused on trying to
keep the faucet up and running.

NANO actually got delisted
from Cryptopia because

the faucet users were abusive
toward the exchange support.

But eventually they managed
to get listed on Mercatox and BitGrail.

And unfortunately,
because of all the issues

that they were running
into with the faucet,

they ended up deciding
to turn it off early.

Only about 39% of the
total original circulating

amount of NANO is out
there right now.

They then publicly released
the address to the genesis account,

the landing wallet,
and the faucet account.

That way there's complete
transparency within the community,

and I'll put those addresses
below in the description
so you can see for yourself.

No portion of the NANO
coins have been kept

from the original
genesis of the project,

and all the NANO that is
in circulation right now
is the total that will be distributed.

On to the technology.

NANO is a trustless, low-latency,
third generation cryptocurrency.

And unlike a lot
of other cryptocurrencies
that use normal blockchain,

NANO utilizes what's called
a block lattice structure.

NANO's focus is for fast,
free, trustless transactions
from peer-to-peer.

And that's where they mainly
differ from IOTA because IOTA's
focus is more machine to machine.

The team has stated that they are
more focused on micropayments

instead of dealing with
the internet of things,

but they haven't completely
ruled that out as a possible

use case if people are
interested in doing so.

In my IOTA video I had
explained what a DAG was,

which is Directed Acyclic Graph,
but I'll quickly summarize again.

Directed means that new transactions
validate preceding transactions.

Acyclic means that
it's not a circle.

And graph refers to the fact
that the block lattice also
doubles as the ledger.

When one wallet wants to send
a transaction to another,
that wallet creates two blocks.

One block will go
on the sender's blockchain,

and one block will go on
the receiver's blockchain.

When the receiving
party comes online,

and their blockchain
connects to the network,

the wallet will then pocket the funds
and the transaction is completed.

Transferring funds on NANO's protocol
creates two separate transactions.

The first one deducts the amount
from the sender's wallet,

and then the second one adds the
amount to the receiver's wallet.

Each send transaction must
reference the owner's

previous block in order to
prevent a double spend.

NANO uses a Delegated Proof
of Stake system, or DPoS.

If you don't know what that means,
pop over to my Crypto 101 video

where I cover consensus protocols
so you can get a better idea.

Basically, this just means that
users have the ability to choose

a representative node to
vote on their behalf.

The voting system is
balance weighted.

And what that means is the weight
of the representative vote

is directly proportional
to the amount of NANO
that's linked to their account.

The greater the amount of NANO
linked to the representative,
the stronger the vote will be.

There's a public list
of the representatives,

and I will leave that
link in the description.

It's important to note
that the NANO architecture

also utilizes Proof of Work
in a very minor capacity.

They use it as an
anti-spam measure.

Essentially because the NANO network
doesn't require transaction fees,

somebody could
indefinitely spam it.

With the Proof of
Work implementation,

each block requires a very
small amount of work.

Five seconds to generate,
and one microsecond to validate.

This would force a malicious
actor to dedicate

a lot of computing power
to carry out an attack,

while simultaneously
only requiring a very small
amount from individual users,

overall preventing a
much bigger problem.

NANO has desktop wallets
that are available to
Macs, Linux, and Windows.

And there's also the
availability of a web wallet.

The team is very active
on their Discord server
and within their community.

They were a great resource
for me to help ask questions to get
some information for this video.

Not to mention that
they just rebranded,

so I think overall that shows
dedication for the project long term.

So that brings us
to the present day.

And the current market cap
sits at about USD$133 million.

And Nano is at number
23 on CoinMarketCap.

Not to mention the rebranding
which I touched on before.

That just happened, well, today.

Looking forward to
2018 on their Roadmap,

they would like to create a
lite wallet at some point.

They also said that they
would like to do some

chain pruning on the network
to reduce the size of it.

On to the Pros.

I would like to start off by saying
that the team was very receptive.

Everybody was very
easy to get a hold of

and there's a lot of communication
going on in the Discord server.

They were also very transparent
and forthcoming about
the genesis of the project,

how they started, and they were
willing to answer questions for me,

the things that I
couldn't find online.

I would also like to point out
so far there's been no significant
drama with the team,

and within the crypto community
that's a pretty big accomplishment.

I also love the way that
the project started.

I think that utilizing
the faucet idea

was a great way to get people
involved and distribute the coin

without anybody feeling like
maybe there was a risk involved.

Another pro would be
their rebranding for me

because I think
that the old name

RaiBlocks was a
bit of a misnomer

considering they didn't use
a traditional blockchain

and they used a block lattice.

And unlike some of
it's competitors,

it doesn't have a
central authority

managing transactions or
maintaining the network.

So this is a fully
decentralized cryptocurrency.

On to the Cons.

I would have started off by
saying that they need to rebrand,
but they already did that.

And in the same light,
as much as I like the faucet idea,

it still is essentially
a premined coin.

I mentioned this in my IOTA
video, so I'll mention it here.

DAG technology does not have
the amount of testing let's say
that the blockchain does.

So we don't know if it gets to
Bitcoin-sized transactions

if the speed or the
efficiency of the network

is going to be compromised.

Another issue is if in theory
an attacker bought up millions

of NANO they could carry
out a voting attack.

NANO does recognize this as a
weakness and a possible issue,

but they don't see it
as a large threat

because of the fact that an
attacker would have to buy up an

extraordinarily large amount
of money to pull that off.

All in all, if you're interested

in DAG technology as a
hedge for the blockchain,

and you don't really like IOTA,
then NANO might be for you.

My normal disclaimer applies to this
video and all of my other videos.

Please do not take my
opinion as trading advice,

and please do your own research if
you're going to invest in something.

As always, I appreciate you
guys coming to watch my videos.

If you disagree with me and
you want to tell me why,

feel free to come on my
Discord and hang out.

We're in there
pretty frequently.

And also I've started making
podcast versions of these videos.

Obviously, it's just audio only.

But I put them
on my Patreon account and
they are there for contributors.

So if you are interested, I will
link my Patreon in the description.

And again, thank you for
coming and stopping by,

and I will see you guys soon.