Thread by @thegreatola

What makes a good crypto currency ? 🧵🧵🧵

RT FOR OTHERS

1. Near infinite scalability. That means they are able to process at least millions of transactions per second and possibly also billions.

2. Near infinite decentralisation. This means that their voting should be distributed over at least 10,000 to 100,000 different voters. That means, they CANNOT be PoW, because PoW suffers from strong mining pool centralization, so the coting is pretty much distributed across only

..3 voters. They cannot be PoS, because PoS suffers from strong centralization of voting power among the rich, large companies, institutions, governments, thus defeating the whole point of the blockchain. They can also not be dPoS, because dPoS is only distributed across a few...

...dozen nodes.

3. Low energy usage.

While no one can argue that Bitcoin (and other altcoins) mining consumes a lot of electricity (in absolute numbers) given that you need to run a network of few hundreds or thousands of very powerful computers all the time...

... the right way to look at this problem is not about the total consumption but to compare how efficient is the coin relative to the alternative traditional centralized systems that we are predominantly using today and that one day coin might replace.

4. Near instant transactions. That means, that transactions should be confirmed within 3 seconds maximum. 10 seconds is already too much. Imagine, every person needs to wait 10 seconds at the register for the payment to confirm.

This would add much overhead and a lot of lost revenue to any retailer or super market.

5. Permissionlessness and trustlessness. Permissionless means that there is no 3rd party making rules how to vote, thus giving permission. Trustlessness means that nodes do not need to trust each other in order to participate in the voting.

This is not given for Ripple, Stellar, EOS, NEO, Ark, Lisk. They are all permissioned and non-trustless, which always leads to cartel formation, lobbyism and introduces a myriad of social engineering attack vectors such as blackmail, coercion, threats etc.

6. Zero Fees. Having fees is still suboptimal, but it is not such a big point compared to the above 5

7. Demand

The first quality that can say a lot about the coin is its demand. Its value is intercorrelating the demand, and the greater it is, the higher its value.

8. Usability

If the coin is used frequently and in various spheres, the interest to it will grow and people who aren't involved in crypto business yet may enter the crypto market and raise the demand for a certain coin.

9. Community.

If the community always talk about coin value going up, tomorrow we will moon, this & that, doesn’t tolerate discussions & arguments, these are crappy communities. A good community gets everyone involved, arguments are settled by proper communication & resolution

... most of the conversations would revolve around the improvement of the project rather than the price of the cryptocurrency in fiat.

10. Life Cycle.

Basically, most digital coins start from a low price and increase it with the time. However, some projects that look bright at the beginning might lose their value. Therefore old coins that survived many price changes inspiring more confidence.

Your tips are also welcome, we’re here to learn #cryptocurrency

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