What is Vsys Coin and How Does it Work?
Blockchain technology is rapidly becoming one of the most disruptive catalysts of innovation and change in recent history. The core technology that drives cryptocurrencies such as Bitcoin has evolved beyond the original use case devised by Satoshi Nakamoto and now presents the opportunity to decentralize hundreds of different industries.
The shift from the first iteration of the internet into the Web 2.0 era saw the online ecosystem transform from a static, non-interactive medium into a collaborative medium, catalyzing the creation of social networks, e-commerce, and the sharing economy — bringing the world platforms such as Facebook, Uber, Amazon, and Ebay.
Blockchain technology is driving the Web 3.0 paradigm shift. The decentralized nature of blockchain technology facilitates the creation of decentralized applications, presenting use cases that extend into enterprise industries, e-commerce, the sharing economy, and more.
At the current stage of blockchain development, however, blockchain development is hindered by barriers that include scalability, inefficient consensus models, and a lack of interoperable decentralized application standards.
V Systems, or VSYS, is designed to spearhead the launch of the new web 3.0 economy by establishing a blockchain-based database cloud system that streamlines the creation of new blockchain networks and decentralized applications. VSYS removes the barriers to entry that restrict the development and deployment of blockchain technology applications.
VSYS coin is the core of the VSYS network and is powered by an innovative consensus model that resolves the scalability and energy issues presented by traditional consensus models such as Proof of Work and Proof of Stake.
Why VSYS Coin?
The cryptocurrency ecosystem has grown rapidly in the decade following the launch of the Bitcoin network. The mining of the Bitcoin genesis block represented a major leap forward in the development of immutable digital currencies — a solution to the double spend problem and the establishment of a truly secure means of storing and transferring value outside of the fiat currency paradigm.
Consensus is the cornerstone of any functioning blockchain network. Without a concrete system that incentivizes positive network participation and disincentivizes bad actors, blockchain networks cannot function.
The primary innovation of the Bitcoin network was the means through which it achieves consensus between network participants. The Proof of Stake consensus model disincentivizes bad actors by requiring the investment of energy capital in a blockchain network, a method that has resulted in the establishment of the largest and most widely-used cryptocurrency of today — Bitcoin.
The Bitcoin network, however, is not without flaws. Ongoing community arguments regarding transaction throughput limitations have resulted in the creation of countless Bitcoin forks, while the massive energy requirements of the modern Bitcoin network is starting to impede the efficiency of the Bitcoin mining industry itself.
The evolution of the blockchain ecosystem has resulted in the creation of many alternative consensus methods, such as Proof of Stake, which not only dramatically lowers the energy required to maintain a blockchain network, but also significantly increases transaction throughput. Proof of Stake, however, fails to incentivize hardware development and presents a number of issues regarding the random selection process used to establish the next block creator.
The Vsys model uses a supernode-based consensus model that resolves the issues presented by “vanilla” proof of stake. By incentivizing network participation and node hardware upgrades, the VSYS Supernode Proof-of-Stake (SPoS) consensus model rewards both supernodes and VSYS coin owners while ensuring network integrity and delivering high scalability and transaction throughput.
What is SPoS and Why is it so Exciting?
The SPoS consensus model follows a delegated Proof of Stake model in which holders of VSYS coins lease coins to elected “supernodes,” which are responsible for the minting of new blocks.
Traditional Proof of Stake systems elects new nodes to mine new blocks through a pseudo-random system based on the number of tokens the node has staked. In the SPoS consensus model, block minting is performed by Supernodes that are leased coins by VSYS network participants through minting.
Supernode status can be contended at any time via a process that assessed and compares minting average balance. This process fosters hardware-focused competition between supernodes and ensures that supernodes are incentivized toward the incremental increased in total network power through competitive selection.
In this manner, holders of VSYS tokens are able to take an active role in the governance of the VSYS ecosystem and are provided with a reward for leasing their coins to supernodes in the form of interest.
What are the Benefits of Leasing VSYS Coins?
VSYS Coin holders that lease their coins to supernodes in order to participate in the minting process are rewarded with interest. Leasing coins on the VSYS network is extremely simple — users simply open the VSYS Coin wallet app and select a supernode in an easy-to-navigate supernode market.
VSYS Coin holders lease VSYS coins to supernodes, who then compete to mint the next block. When a supernode mints the next block, a minting reward is passed to the minting supernode, who then shares the reward with the VSYS Coin holders that lease coins to it.
How is the Return on Investment for Platform Participants Calculated?
The reward for coin leasing is calculated via a simple formula. Determining the average return on coin leasing is performed relatively easily but depends on various factors that include the number of VSYS coins leased to a supernode, the minting average balance of the node, the total minting reward gained by the supernode during minting, and the supernode interest rate.
The VSYS supernode marketplace allows VSYS Coin holders to assess each current supernode and candidate supernode and lease to the supernode that offers the most compelling reward system, track record, and overall vision, thereby fostering the growth and stability of the network in a collaborative, decentralized manner.
Where Does VSYS Coin Go From here?
The SPoS consensus model that drives the VSYS network delivers extremely high transaction throughput and scalability. These two factors alone, however, are not the core use case of the VSYS network.
V Systems functions as an open platform that supports the growth of large-scale decentralized applications across multiple consensus algorithms. By establishing an interoperable, agile platform that promotes the rapid deployment of scalable dApps and decentralized databases, V Systems is positioned to facilitate the creation of database applications, modular blockchain architecture, and large-scale enterprise applications.