NXT Myths: What Should We Know About NXT Generation PoS Cryptocurrency

Nxt Myths
What should we know about Nxt generation PoS Cryptocurrency
Mgr. Salsacz
Content
1. Nxt is not a scam, it wasnt created by anonymous developers........2
2. The very fair Distribution of Nxt.....................................................6
3.
Original Stakeholders..................................................................8
4.
Source code..............................................................................11
5.
Unsafe password.......................................................................15
6.
Worthless coin without mining...................................................17
7.
Rich get richer...........................................................................25
8.
Innovations over Bitcoin............................................................30
NXT Donations: 15003961341330858247
1. Nxt is not a scam, it wasnt created by anonymous

developers
Nxt was invented by anonymous programmer
Nxts source code is being reviewed by known
developers
New code implementations will be approved by
democratic voting
Nxt was invented by BCNext, who is a programmer at the age of 35+, who lives
in Europe.1 He is a veteran member of Bitcointalk forum, but he stays anonymous
like Satoshi Nakamoto.2 He can still reveal his identity, as he promised. 3 He is
watching the Bitcointalk forum from his real account, he supports the Nxt helpers
by donations/rewards. BCNext prefers to work on creating the project alone. He
paid a team of core developers to help him with the client and create some
functionalities like decentralized exchanges. One member of the core
development team Come-from-Beyond was paid by BCNext to work on Nxt from
October 2013 till April 2014.4 Come-from-Beyond is a 34 years old programmer
from Minsk in Belarus.5
1 This guess is based on Assembler style in the code (Come-from-Beyond: I noticed the
same things, the code is written in back-to-90s style. The author definitely used to code
in
Assembler.
http://www.reddit.com/r/nxtcoin/comments/1toz2d/warning_nxt_source_code_is_very_low_
quality/ceafrr3)
and
the
statistics
of
the
posts
of
BCNext:
https://bitcointalk.org/index.php?action=profile;u=152600;sa=statPanel.
2 https://bitcointalk.org/index.php?topic=303898.msg3253022#msg3253022.
4I'm that guy who is developing the client, so I will publish updates until BCNext is back.
If I disappear one of the 2 remaining guys will continue the work until Nxt is released as
planned.
https://bitcointalk.org/index.php?topic=303898.msg3520138#msg3520138
One of my employe is developing Nxt client. https://bitcointalk.org/index.php?
topic=303898.msg3580883#msg3580883.
5 https://bitcointalk.org/index.php?topic=113906.msg1230551#msg1230551. On the
Chess site he also filled a Birthday, but since i tis January 1, it is probably fake due to the
quick registration process http://www.chess.com/members/view/Come-from-Beyond.
On January 2014 joined Jean-Luc a core team as a non-paid programmer. 6 He

has a Phd, probably comes from Switzerland (or France) and already celebrated
his 30th birthday.7 Jean-Lucs duty is to work on the code. Jean owns nice amount
of NXT, that's why he is programming for free, for the benefit of his own
investment. BCNext was only an inventor, others will continue on his legacy and
rewrite his ideas into a better looking Java codes.
After the release of the source code started many developers with code
corrections (like Ricot, who found some implemented flaws). A few Greek IT
experts from Thessaloniki and Athens are being paid for reviewing the code by
the original stakeholder Klee who is managing them. 8 Klee spent a huge part of
his Nxt on donations, bounties and giveaways. 9 He doesnt hide his real identity. 10
The names of his team were also revealed. There were only 8 original
stakeholders who paid 1 Bitcoin during open IPO. 11 Each of them got 50 million
NXT, Klee is one of them. In January 2014 only 4 of these 8 original stakeholders
own more than 30 million NXT.12
There are at least six developers who are working on the Nxts applications
fulltime: Abuelau, ferment, nexern, NxtChg and Graviton with his assistant, who
helps him with the biggest Nxt exchange. This list isn't finite, there are many new
Nxt developers, like Marcus03 or wesleyh with their fantastic apps. There are
tenths of helpers, translators, authors of articles, but people who said that they
7 Some people say Jean-Luc uses french accent in his english, someone saw a
new client in the peer list from the Switzerland, he used a CET in his signature.
CET referrs to the timezone in the central Europe from Spain to Slovakia. He
also used a russian email, but they dont use CET in Russia or Belarus.The
information about Phd and age got author of this text by personal message from
Jean-Luc.
9 https://bitcointalk.org/index.php?topic=347927.0.
10 Klee is moderating Facebook group Ubiquitous Cryptocurrencies under his real name.
https://www.facebook.com/groups/UbiCrypt/?fref=ts.
11 The list of original stakeholders is hardcoded to the sourcecode. More in the

chapter 3 or: Salsacz, Where is Nxt from Original Stakeholders?, in:
http://nxtcoin.blogspot.cz/2014/01/where-is-nxt-from-original-stakeholders.html.
12 Ibidem.
3
work for Nxt fulltime or at least halftime are: Joefox, Opticalcarrier, Pinarello
and Salsacz.
500 different people had already been discussing at the main Nxt thread in
Bitcointalk.13 Once there were 93 active nicks in last 3 days. In the middle of
January they reached 20.000 posts at the page of 1000. The statistic from the
end of 2013 shows the biggest spammers of the Bitcointalk topic: Come-fromBeyond (2005), laowai80 (460), klee (324), smaragda (304) and opticalcarrier
(211). 15.000 people own Nxt account, this number rises by 200-400 every day. 14
500 users own more than 100.000 NXT, 2.000 stakeholders own more than 1000
NXT.15
Nxt network of peers has got members from all over the world. Most people
come from the United States, but there is also a big community in Germany,
Hong Kong, Russia, United Kingdom, Japan and Netherlands. There is one user
from Iceland, Jamaica, Panama, Ethiopia or Israel. 16 Some of the Nxt Wiki pages
have already been translated into 11 languages. 17
Nxt is still a small group of individuals who have no centralized place. Nxt is a
decentralized currency, thats why there are more Nxt forums, exchanges, sites,
social media profiles and also marketing groups. There will never be any main
leader. All decisions in Nxt will be based on democratic voting.
Nxt isn't just some other cryptocurrency. We are a movement. We are a
community who help each other out. We are here to change the world for the
better.18
The statistics from the next lines are based on this citation created by newcn.
14 http://87.230.14.1/nxt/nxt.cgi?action=40&sub=7.
15
Originally
based
on
the
numbers
from
marcus03s
https://bitcointalk.org/index.php?topic=414965.msg4508988#msg4508988.
client
16 Bulgaria(1), Canada(2), China(2), Czech Republic(4), France(6), Germany(22), Hong

Kong(20), Hungary(1), Iceland(1), Israel(1), Japan(12), Latvia(1), Lithuania(3),
Luxembourg(1), Netherlands(7), Norway(3), Poland(1), Russia(21), Slovak Republic(1),
Slovenia(1), Spain(2), Switzerland(2), Ukraine(5), United Kingdom(18), United
States(177), http://peerexplorer.com/. Map: https://mapsengine.google.com/map/u/0/edit?
mid=zDbwNrja6dlY.kwTCMrAWqtAQ
17 http://wiki.nxtcrypto.org/.
18 https://bitcointalk.org/index.php?topic=422052.msg4612445#msg4612445
4
About BCNext, inventor of Nxt

Questions for BCNext
19
January 2014:
Q: Why was the initial funding cancelled suddenly with few people?
A: I wanted Nxt to be launched by the community, not by a single person.
Success of Nxt is supposed to be achieved by work of a LOT of PEOPLE.
Q: How would you solve problem with scam accusations according
to "unfair" distribution Nxt to 73 big stakeholders?
A: This problem can not be solved. Even if we had a million stakeholders the
rest seven billion people would call this unfair. A world with the money
can not be perfect.
Q: What are the most important 5 things the community should do,
in order to properly support Nxt in the next 6 months?
A: Review all my ideas, they might be flawed. Avoid centralization. Do not
pay much attention to the price of 1 NXT measured in fiat money.
Remember that half-measures is a way to nowhere.
Do not trust
strangers on the Internet, especially if their nickname is "BCNext".
November 2013:
Q: how many bitcoins are you going to contribute? (Are you going to
keep the coins you contributed yourself? Or you will take a creator
cut (certain %)20
A: I don't know how much I will contribute. This depends on the price of
Bitcoin and some other factors. These bitcoins, like the others, will be used
to pay bounties for development. No creator cut.
BCNexts citations:
A lot of time was spent on talking, the outcome did not satisfied me. That is
why now I am working alone. The things are implemented much faster this
way.21
What others said about BCNext:

Come-from-Beyond:
21 https://109.201.133.195/index.php?topic=303898.360
5
I don't think BCNext is interested in money. He spent more than he raised

funds.22
With all my respect to BCNext, he is too paranoic about
FBI/aliens/illuminati, they r not interested in kidnapping of yet-anothercryptocoin creator. I believe that was (unsuccessful) PR attempt.
Fortunatelly, we don't need him after the launch. 23
Salsacz:
I don't care about BCNext. Nxt was and is being released by 70 guys. And
this number is every day bigger and bigger (now 15.000). They have 5
months for the initial IPO before Nxt launches. Now we are still in alfa. Nxt
was released by a community of 70 people. I cannot even send a Nxt
message with the stupid client that was created by the dinosaur inventor
BCNext. Now months after the release I will finally get a client that was
created by a non-original stakeholder and funded by original stakeholders...
The code won't look like it was written by my grandpa - again - thanks to
the community effort, Jean-Luc, Ricot and other users, often non original
stakeholders, who even don't know who BCNext is. This is Nxt.
What is BCNext?
Next is next/Nxt. Salsa also thinks that BC comes from the Proof of Stake
article and refers to Beyond Cryptocurrency.24
What else do we know about BCNext?

He often uses special phrase can not. He is a genius who doesnt care about
money or glory.
BCNexts likes symbols:

Now we know about 2 symbolic numbers hidden in the world of Nxt:
24 http://bitcoinmagazine.com/6528/what-proof-of-stake-is-and-why-it-matters/.
6
3 January: the release of Nxt happened 5 years after the release of

Bitcoin.
21 Bitcoins: The IPO was stopped in the time when were gathered 21
Bitcoins, i tis 1/1000.000 of the all existing Bitcoins from now on.
Anonymous BCNext: BCNext plays the same role as Satoshi Nakamoto.
We dont know who they are.
Funny descendants of Nxt:

GetVisaCoin::Sibling of NXT::Born for retribution & deterrent 25
[NEX] Nxt Reimagined26
NEX :: descendant of NXT - Imagine Fairness! 27
NOX extends the dark side of NXT - 28
ME.TOO :: descendant of NXT - 4 billion coins29
NEXX :: descendant of NEX :: descendant of NXT :: descendant of
Bitcoin30
NEM :: descendant of NXT - 4 billion coins 31
KLONE :: descendant of NXT - 1 Million Coins - VERY RARE!
28 https://bitcointalk.org/index.php?topic=422353.0;topicseen.
31 https://bitcointalk.org/index.php?topic=422129.0
7
2. The very fair Distribution of Nxt

Q: Do you think the unequal distribution of bitcoin / big gains of early
adopters / will be a deterrent in a more widespread adoption of
bitcoins?
A: No. Early adopters get bigger gains (as they should) because they take on
bigger risk. A bitcoin can be divided into 100 million pieces, so I don't see
divisibility or distribution as a problem.
Cameron Winklevoss
The distribution of Nxt has many phases:
Original IPO: (1 NXT = 2 Satoshi) = (September 28 - November 18 = 61

days!)
First week (1 NXT = 100 Satoshi)
Second week (1 NXT = 400-2.000 Satoshi)
Next month (1 NXT = 3.000-6.000 Satoshi) aliases
Second half of January (1 NXT = 8.000-16.000 Satoshi) bter.com
exchange added Nxt
February (?) new client, distributed exchanges, stock exchanges (?)
March (?) transparent forging (?)
April (?) colored coins (?)
The original Nxt IPO was 61 days long. 32 People had two months to invest in Nxt.
Is this unfair? Should BCNext wait 90 days? Or 450 days? What number would be
fair? 61 days long original IPO, when you had 1 Nxt for 2 Satoshi is fantastic! It
was unfair only for people who invested early during 66 days and they had to
wait 67 days until they got their deserved millions of NXT. Everyone could join
them during those 61 days.
The distribution of NXT is very fair because it still continues. Now it isnt
in hand of one man, but it is a community effort. BCNext gave us a long
time to get on the train.
If all coins are in existence already, doesn't this make the

original holders of Nxt very wealthy?
Potentially. The original stakeholders of Nxt all made an investment of
Bitcoin to seed their holdings, however, with no promise of any kind of
32 https://bitcointalk.org/index.php?topic=303898.0;
8
success or return on investment.33 In order to get more users they started

to sell their stakes in undervalued prices and also they spent tenths of
millions on bounties or giveaways. There are many types of original
stakeholders: those who paid 2 Satoshi during 61 days long IPO 1, those
from IPO 2 (100 Satoshi for 1 NXT) or early owners from IPO 4 who bought
NXT for 3100 Satoshi before Nxt expanded to the BTER exchange.
Q: How would you solve problem with scam accusations according
to "unfair" distribution Nxt to 73 big stakeholders?
BCNext: This problem can not be solved. Even if we had a million
stakeholders the rest seven billion people would call this unfair. A world with
the money can not be perfect.
Why was the launch of Nxt speeded?

Come-from-Beyond: BCNext explained why he speeded up the launch. He
wants the stake holders to make all important decisions.34
BCNext: I wanted Nxt to be launched by the community, not by a single
person. Success of Nxt is supposed to be achieved by work of a LOT of
PEOPLE.35
When did Nxt really launch? Was it really in the day when the Billion NXT was
transferred from the Genesis account to the original stakeholders? The IPO had
been running for weeks in November 2013. In first days NXT cost 100 Satoshi. In
first weeks of the December the price of Nxt was still about 400 Satoshi. Then
1500, 2000, 4000 before Christmas and if we dont count the first bubble, we
came back to the original 4000 in the middle of the January. But still we have
really bad client. Nxt is not yet traded in any of the big exchanges. There are
many features already programmed and tested but they still werent
implemented why?
We are still in a Beta. The launch wasnt in November 24, it didnt happen in
January 3, even in April Nxt wont have 100% of all functions. We all (15.000 Nxt
users) are beta original stakeholders. The distribution of NXT is extremely fair.
The IPO still continues. We haven't launched yet. We can forget about some 73
stakeholders... Now everyone has an opportunity to jump on the train... and also
to drive him! Why Nxt doesnt use all features now? Because CBNexts plan is to
bring as many as possible users before the real Nxt will be released. Then we will
have more users, more features, all source code, but most important this
33 Wiki.Nxtcrypto.org.
9
launch will be leaded by all Nxt community. This will be made by decisions of
stakeholders. The success of Nxt is now supposed to be achieved by Nxt
community, not BCNext.
There has been a hell of a lot development and implementation since the
initial creation of the block. It's called "capital appreciation," or "sweat equity,"
and it means that the value of the product is increasing because it is becoming a
more robust product through the efforts of developers, who are augmenting the
functionality, as well as marketers, and various other support people and
mechanisms.36
What happened with the 21 Bitcoins?

Bitcoins were required to determine how to split the stake among founders.
That's why BCNext asked for tiny amounts. These bitcoins were used to fund
development but they covered only part of expenses. When people talk about
Nxt IPO they forget about this important detail. 37 21 Bitcoins were used as a
token amount. They didnt represent any real world development costs. 38 BCNext
did everything only for the people, not for the money.
The original funding period was open for two months. That was more than
enough time for everyone who wanted to invest to invest. The only reason he
only collected 21 BTC was because there was very little interest. No matter when
the IPO period ends there will always be people who are "left out". You could
conduct the IPO over a period of a thousand years and there would still be people
"left out".
3. Original Stakeholders
Q: 927 people own half of the bitcoins. Do you consider this a
hindrance to its future market cap?
A: No. Bitcoins can be divided into 100 million pieces so its not important
whether half of the bitcoins are held by 927 people or 9,270,000 people, etc.
Cameron Winklevoss39
39
http://www.reddit.com/r/IAmA/comments/1swnnl/i_am_cameron_winklevoss_and_i
_love_me_some/ce1z4dm.
10
How is NXT distributed?

-
If I don't count Genesis transfers, in 52 days were transferred: 2.25 Billion

NXT
NXT:
28.9% of NXT is owned
by 0.07%
21.5%: 0.14% : 2x
Bitcoin:
28.9% of BTC is owned by:
0.005%
21.5%: 0.087% : 17x
24.8%: 0.55% : 8x
24.8%: 0.98%
20.7%: 99.76% : 1.500x
20.7%: 98.928% : 20.000x
: 200x
USD: 40
30% USD : 0.001%
19% USD - 0.01%
(10x)
32% USD - 0.1%
(10x)
19% USD - 99.9%
(1000x)
http://bitcoinexaminer.org/wp-content/uploads/2014/01/Who-owns-all-thebitcoins2.png
http://www.businessinsider.com/927-people-own-half-of-the-bitcoins-2013-12
In this table you can see that NXT distribution is much better than Bitcoin or US
Dollar. Nxt has got more fair distribution than Bitcoin. In Nxt 30% is owned by
0.07% of users, in Bitcoin 30% is owned by 0.005% of users.
By these metrics Nxt's distribution is already fairer than Bitcoin's. This is after
roughly 1.5 months of distribution, and it'll probably improve even more in the
coming months. There is a simple rule about Nxt distribution. Big stakeholders
will lose more value, if they hold a lot of NXT. So it is in their interest to share
their stakes.
The same thing applies to 51% attack: in PoS coins like NXT 51% is more
expensive and less logical, because:
You need to pay and acquire 51% of the stakes to be able to attack
Even if you succeed, after your attack the PoS coin loses value because
of the attack and insecurity. Again the attacker himself loses more, as
he owns 51% of coins and they lost value.41
Litecoin
- Top 10 LTC addresses own 7 million of LTC = 27%.
- Top 74 Litecoin addresses own 10 million of Litecoins = 40%.
40 http://bitcoinexaminer.org/wealth-distribution-part-ii-fiat-currency-vs-btcinfographic/ , http://www2.ucsc.edu/whorulesamerica/power/wealth.html.
11
Other 3 million addresses own 15 million Litecoins. 42

owners/accou
nts
1 200 000
280 000
63 000
10 000
Bitcoin
$1
1 BTC
10 BTC
100 BTC
1000 BTC
880
10,000 BTC
47
Nxt
1-10 NXT
11-100 NXT
101-1000 NXT
1001-10.000 NXT
10.001-100.000
NXT
100k - 1 Million
NXT
1 - 10 Million NXT
10 - 30 Million
NXT
30-50 Million NXT
account
s
7 352
827
1 236
869
718
312
122
21
6
Doesn't this centralize the Nxt since most coins are in the
hands of about 75 individuals?
Some stakeholders are still holding on to their original pools of Nxt, but many
have begun to distribute them to others as donations, bounties for development
and promotion, exchanges, etc. Bitcoin is five years old, and half of the total
supply of Bitcoin is held by a little over 900 people. 43 1.18% of all non-trivial
bitcoin accounts hold 68.89% of all bitcoins. 44
22 of the richest original stakeholders received more than 10 million. There
are only 8 Stakeholders who received 50 million for their Bitcoin. If I look only at
top 8, they started with 400 million, now they own 250 million.
If I look at other 14 Stakeholders, they owned 350 million. Now they have 90150 million! There were some big trades so I wasn't sure if it was a trade or only
a transfer to the new account, but I am sure about max number!
If I look at all richest 23 stakeholders, it's: 750 million on 24 November 2013.
And now: 345-450 million on 10 January 2014. If I look at 23 richest original
stakeholders, they owned 75% of all Nxt in the first day, but now they own only
34-45%. 300-400 Millions had already been sold to the new users in 6 weeks.
42 richest original stakeholders

1
24.11.2013
10.1.2014
49 985 380
50 004 185
24
24.11.2013
10.1.2014
9 975 150
8 901 894
42 http://ltc.blockr.io/trivia/blockchain, http://www.litecoinrichlist.com/.
43 Nxt Wiki
44 http://bitcoinrichlist.com/charts/bitcoin-distribution-by-address?
atblock=275000.
12
49 875 751
49 874 767
25
9 476 393
1 599 999
49 875 751
26
8 644 631
49
49 875 751
51 170 795
27
6 668 388
6 575 345
49 875 751
25 925 690
28
5 486 333
5 399 971
49 875 758
9 500 626 ?
29
5 264 386
49 876 257
46 781 257
30
5 033 128
2 427 700
49 875 751
30 776 494
31
4 987 575
4 980 418
34 913 026
2600 ?
32
4 987 575
2 558 217
10
49 875 651
1000 ?
33
4 962 637
100 001
11
30 922 966
27 071 647
34
2 916 900
1 000 000
12
29 856 290
35
2 867 856
500 039
13
29 437 998
25 849 742
36
2 724 712
224 622
14
24 912 938
1 986 246
37
2 690 963
489
15
24 880 020
15 669 333 ?
38
2 684 479
3 058 444
16
22 166 945
39
2 468 850
219
17
19 925 363
10 + 15
mega ?
9 895 683
40
1 970 092
1 469 943
18
16 625 250
800
41
1 845 403
2 100 606
19
15 487 585
12 600 371
42
1 476 156
9 476 896
20
14 962 725
21
14 887 912
22
11 083 556
4 502 427
23
9 975 150
875 135
All original
accounts:
24.11.2013
1.12.2013
8.12.2013
15.12.2013
22.12.2013
29.12.2013
5.1.2014
6.1.2014
NXT
1,000,000,000
622,209,864
406,016,313
305,742,843
265,220,001
248,241,416
148,913,050
139,681,005
4. Source code
Why isn't Nxt open-source?
Eventually, it will be. At the moment, some of the code is still private
because it is still being hammered out. The development community
released all of the base source code on January 3, 2014, and source code
for additional features (the "secret sauce") will be released in the spring of
2014.
The developers have introduced three security flaws into the
13
source code to prevent people from creating copies of Nxt by simply taking
the source code and re-using it. People who discover the security holes
claimed rewards for finding them.45 Two of three implemented security
flaws had already been found.
As Bcnext said, anyone could join the development after the release of
the source code.46 So the Klees crew and Jean-Luc joined the dev team
and started with refactoring the java binaries.
What did experts say about Nxts source code and about
inventor BCNext?
Come-from-Beyond:
BCNext knew that Java binaries could be easily decompiled, everything
in Nxt is made on purpose. U'll get most of the answers in the last part of
BCNext's plan47
I noticed the same things, the code is written in back-to-90s style. The
author definitely used to code in Assembler. But I wouldn't say that this is
bad. U can buy "Java for dummies" book and in 3 weeks u'll be writing
code full of comments like "// Now we set A to B plus C", declarations like
"static final int ONE = 1;", Optional<T> from Guava that requires 3rd party
libraries, methods that r called once... the list goes on. I'd rather trust to
code written in assembler style. Script kiddies shouldn't write financial
software.48
Xibeijan:
NXT's beauty is in the algorithms and maths that have brought forward
the state-of-the-art. I seriously doubt the creator cares about keeping tidy
with the code. In fact, I know quite a few genius computer scientists who
produce really ugly, stupid code. However, that doesn't matter one iota
45 wiki
47 https://bitcointalk.org/index.php?
topic=345619.msg4415918;topicseen#msg4415918
48
http://www.reddit.com/r/nxtcoin/comments/1toz2d/warning_nxt_source_code_is_v
ery_low_quality/ceafrr3
14
when the algorithms are groundbreakingly better than anything that's

come before.
Our investment is in the extremely clever people behind the NXT
project. Computer science and software engineering, though related, are
different things. I am glad the NXT has a computer scientist like BCNext
behind it who actually has new ideas and can bring them to life, no matter
how messy the code may be. New capabilities are something that has
been missing from every other alt coin that has come before NXT.
As I said, some really great computer scientists do not follow great
software engineering principles, but their code does things no one else's
can. And that, my friend, is the point.
Bcnext is a freaking genius. I worked so hard to try to figure something
out like this myself to no avail. What i proposed in my thread is a far cry
from this much better solution.
That we are not investing in source code, we are investing in the
algorithms, the big ideas (BCNext) and the huge community supporting
NXT.
Computer science and software engineering, though related, are different
things. I am glad the NXT has a computer scientist like BCNext behind it
who actually has new ideas and can bring them to life, no matter how
messy the code may be. New capabilities are something that has been
missing from every other alt coin that has come before NXT.
Rlh:
I know that this is about fees and not generating currency, but the
concept of adjusting system metrics, based off daily transactional
statistics is something I've looked at and thought about for a loooooong
time. I think we could do the same type of thing here.
tk808:
This is the real-world dude, not an algorithm found in a textbook.
bitcool
You have to give the creator credit for implementing the first version
bitcoin-era crytocurrency in Java. I am sure a lot of time and effort were
invested in this.
achimsmile
15
I am amazed how motivated, innovative, and intelligent (sometimes I

only understand half of the tech talk in the main thread the community
behind NXT is!
AdamaBit
If you'd read all of BCNext's posts (which I did) you'd see that lots of
people wanted to give him more coins, and not just one at the most, which
he put the cap on. But he wasn't motivated by that he just wanted to get
the coin out there, he could have taken a lot more of people's money, hell
if I hadn't have come late to the party I would have jumped on in there and
taken a punt on him. But he actually only wanted 21 BTC's so that it
mirrored satoshi's 21 million BTC's! He's kinda of kooky and probably a bit
of a genius (used lightly). But I liked his enthusiasm and paranoid
personality. (He got a call on Skype from someone saying that they were
the police and then stopped posting).
Jl777:
Source code appears to be the work of a super-genius with a strange
formatting style.49
Asian Prepper:
I can totally see the words "genius" & "masterpiece" being used to
describe Satoshi but lets wait for some solid proof & evidence first before
we use those words to describe BCnext. Right now we have lots of hype n
"sizzle" but I dont see any solid "steak" yet to show for the Nxt hype yet.
Right now, from an early adopter & Nxt investor perspective, all I see is
another copy cat programmer attempting to copy satoshi's shroud of
anonymity, idea of a public ledger, etc.
Being "original" is genius. Being "different" is NOT genius.
Keep in mind that Satoshi created BTC to take power away from the 1%
on wall street n give it back to the 99% on Main Street while BCnext
created Nxt for personal financial gains. Keep in mind that there is nothing
wrong with doing some thing for personal financial gains but I would
hesitate to compare or place an unproven coder on the genius level of
Satoshi.
I invested in Nxt because it was the first copy cat coin to make an
attempt to come up with its own source code instead of being lazy n
copying Satoshi's code. Is it possible that BCnext is another genius like
Satoshi? Of course its possible... I hope BCnext is able to produce the
16
code that he claims n provide proof of his genius. .. Until there is proof...
BCnext is just another wanna be copy cat... once proof is clearly
available. .. I will be the first to promote the genius of BCnext's.50
Utopianfuture:
It takes a historical perspective to know what kind of contributions
BCNext would make so I agree that at this point over-hype is premature.
But in my personal observations, he has shown some signs of a genius in
the making in some levels. There are technical innovations such as POS,
transparent forging, however what I see the most valuable in his works is a
coherent vision of what a decentralized network could be. It's similar to
the way Steve Job designs the first Iphone. There are technical
improvements compared to earlier smartphones in the first Iphone, but
much more important innovation is the way everything is brought together
to define what a smartphone should be. NXT decentralized network could
be the same. It will succeed not on a specific feature but on the way all the
different features are bought together in a coherent framework; plus all
that hi-techs are accompanied with strong message of decentralization
and community involvement. That the whole package together imho is the
novel contribution.
Satoshi has paved the way with his blockchain original idea. But
without a written evidences, I doubt Satoshi has such a strong vision of
how a decentralized network based on blockchain technology could be. So
in a sense, BCNext extends Satoshi's original idea.
We still need to wait for the actual implementation of NXT
decentralized network and there are still much uncertainty ahead. But the
only reason I has devoted so much my time to this venture is because I
has a conviction in my above judgement. I believe in NXT success and the
validation of BCNext's ideas.51
17
5. Unsafe password
Since all Nxt accounts are stored on the network, isn't it
possible for someone to guess my "secret phrase" and get easy
access to my coins?
This is a very important question. See our Account Security page for an
in-depth answer. In brief: This question emphasizes the importance of
using a strong, secure password to create your Nxt account. 52
If you enter a passphrase less than 30 characters long in the Nxt client,
you will be warned that you are creating a security risk. A truly random
string of 50 to 60 characters is a far better choice for a passphrase, and
will significantly reduce the risk of someone "brute-forcing" your account
or accidentally using the same passphrase.
Nxt supports 10^77 different account numbers (that's 100 000 000
000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000
000 000 000 000 000 000 accounts), so the range of possible passphrases
is significant. You can use a site like https://howsecureismypassword.net/
to test the strength of your passphrase, and get an estimate of how long it
would take a standard computer to crack it.53
Your password will be safe, if you use 30 characters long password that
looks
like
this:
a6f5g46s5g16s5dg16s5df1g6s,51g6a54fv6\,96d76E5D4.
Brainwallet
Come-from-Beyond: Aye, we r going to follow the same way as
Bitcoin 5 years ago. I still think that brainwallet is much more secure than
files on a disk. 54
A brainwallet refers to the concept of storing Bitcoins in one's own
mind by memorization of a passphrase. As long as the passphrase is not
recorded anywhere, the Nxts can be thought of as existing nowhere except
in the mind of the holder. If a brainwallet is forgotten or the person dies or
is permanently incapacitated, the Nxts are lost forever.
52 Nxt wiki
53 Nxt wiki
18
A brainwallet is created simply by starting with a unique phrase. The

phrase must be sufficiently long to prevent brute-force guessing - a short
password, a simple phrase, or a phrase taken from published literature is
likely to be stolen by hackers who use computers to quickly try
combinations. A suggestion is to take a memorable phrase and change it
in a silly way that is difficult to predict.
The phrase is turned into a 256-bit private key with a hashing or key
derivation algorithm (example: SHA256). That private key is then used to
compute a Nxt address, or a deterministic sequence of addresses.
Nxts are sent to the address. In order to recover the Nxts, one must
recompute the private key with the same phrase. The private key is
imported into a wallet. It is very important when creating a brainwallet to
use a passphrase that has a very high level of entropy. If this is not done,
theft of the brainwallet is an eventual certainty.
This is not a simple suggestion. This is a requirement. Most people
when asked to create a secure password, with everything they've heard
about creating a password, will still create a password that if used for a
brainwallet, will result in the eventual theft of their funds. The simple fact
of the matter is that hacking a brainwallet password is a mathematical
exercise that requires no internet access, no communication, and leaves
no trace, so hackers can collectively try multiple trillions of passwords
every second in the privacy of their own homes. Your bank might tell you
that a 10 character password with uppercase, lowercase, numbers and
symbols is a strong password, but it is not strong enough to secure a
brainwallet. A password that might be strong enough for traditional
banking or a social website is typically unacceptable for a brainwallet.
A brainwallet passphrase, at a minimum, needs to be an entire original
sentence that does not appear in any song or literature. Security is
enhanced simply by including some sort of memorable personal
information, which doesn't necessarily even have to be secret (e.g. an email address, or phone number). A good brainwallet passphrase will have
dozens of characters.
19
6. Worthless coin without mining

Any other distribution would be unfair.
Come-from-Beyond55
You do not need to invest in bitcoin in order to make advantage of it. As an
example, if I buy some bitcoin to send to my family "back home" and then
they sell the bitcoin to buy food, we have all used bitcoin but none of us
have "invested" in it per say.56
The proof of work is more secured than proof of stake in other crypto
currencies. Nxt finally solved this problem. Nxts true original invention
Transparent forging brings the revolution in the world of Proof of Stake
currencies. It solves the problem of forked chains in other altcoins like
Peercoin, Namecoin, Mastercoin or Ethereum. Nxt doesnt have to use
centrally inserted checkpoints.57
If there are no new Nxt to be mined, how do you validate the
blockchain and secure the network?
Nxt is a pure Proof-of-Stake (PoS) currency. Users validate the blockchain
and secure the network by running a light weight client on any computing
device (even one that used to run Windows XP). For doing this users are
rewarded with Nxt coin that is collected from transaction fees. In addition,
the "transparent forging" feature of Nxt will penalize accounts that do not
participate in the mining process by temporarily preventing them from
earning transaction fees.58
Nxt is a scam because all Nxt coins are pre-mined
First, it's important to note that Nxt is a pure 100% Proof-of-Stake (PoS)
coin. The only way to implement this form of currency is to issue all
available coins in the genesis block. To do otherwise would force the
implementation of some form of Proof-of-Work scheme in order to prevent
55 https://nextcoin.org/index.php/topic,1783.msg24927.html#msg24927
57 Ben Laurie, Decentralised Currencies Are Probably Impossible, s. 4
<http://www.links.org/files/decentralised-currencies.pdf>.
58 Nxt Wiki
20
attacks on the network that "fake" stake. Since the creator of Nxt wanted a
100% PoS platform, this was not a desirable course of action.
Second, the term "pre-mined" is a misnomer because Nxt coins are not
being mined at all. The original stakeholders in Nxt contributed Bitcoin in
order to seed the creation of the 1 billion coins represented in the genesis
block, and these coins were distributed among the original stakeholders.
The stakeholders are expected to distribute coins by donating them, using
them as "bounties" to pay for work on the coin (software, documentation,
translations, support, etc.) that is done by the community. Even the
creator of Nxt (BCNxt) made an investment. The coins were not generated
from nothing! Third, the creation of the genesis block was fully public, and
all of the original account numbers and their assigned amounts of Nxt are
visible.59
Why is it called forging instead of mining?
With Bitcoin and many other cryptocurrencies, the act of securing and
verifying the blockchain results in new coins being created. With Nxt,
however, all possible coins already exist, and accounts earn coins from
transaction fees alone. As a result, it was felt that a new word - "forge" was needed to describe the manner in which coins are earned.60
What is "transparent forging"?
Nxt has implemented "transparent forging", which allows Nxt software to
predict which accounts will forge upcoming blocks. This is basically done
by iterating through all active accounts and seeing which one has the
highest "hit". Transparent forging rapidly increases transaction processing,
since the account that will forge the next block is known. Another benefit
of this feature is that accounts that are due to forge, but do not, will be
penalized by having their forging power temporarily reduced to zero.61
Why do I have to buy Nxt coins in order to forge them?
If youd like to own some Bitcoin, or any of the other altcoins, you have to
invest in mining hardware to be able to mine some coins. With Nxt, you
buy an actual amount of coins in order to start to start forging. There are
no additional costs, and no expensive mining hardware is needed.62
59 Nxt wiki
60 Nxt wiki
61 Nxt wiki
21
Every 24 hours, there should be 1440 blocks added to the chain. Your
probability of forging a block depends on your share of the total number of
coins that are active on the network. If all available coins (1 billion) were
used for active mining, then an account balance of 694,444 NXT (1 billion
divided by 1440) would mine 1 block per day. However: coins moved to a
brand new account must wait for 1440 blocks to mature some owners
don't bother with mining, don't leave their Nxt software running, or their
Nxt software crashes, so only portion of all coins are actively mining at any
point in time.63 For example, if you have 50,000 Nxt coins, you could forge
0.288 Nxt blocks per day, which translates to one block every 3 or 4
days.64
The number of coins you earn from finishing a block depends on the
number of "fee coins" in the block. The minimum fee per trade is 1 coin,
and the number of trades in a block will vary. A block can contain a
maximum of 255 transactions. It is also possible for blocks to be empty. 65
Can I forge Nxt more quickly by running multiple servers and
multiple accounts?
No. Your ability to forge Nxt depends solely on your total account balance
as a percentage of all available coins. This is what sets Nxt apart as a
pure "Proof-of-Stake" cryptocurrency. CPU power, GPU (graphics processor
unit) power, and the number of servers you run have no effect in fact,
you could even forge Nxt on a very old, low-power computer!66
A new coin has to be distributed in some way. Mining is one such
way, where people are rewarded for helping to secure the
network.67
Nxt uses a new way of securing the network, where you need 3000x less
power. It is only a waste of energy to race by CPU/GPU mining. At the end
62 Nxt wiki
63 Nxt wiki
64 Nxt wiki
65 Nxt wiki
66 Nxt wiki
67 https://bitcointalk.org/index.php?topic=411279.
22
only the richest and the biggest corporations with huge mining systems
get most profits.
Bitcoin had over 4 years of profitable mining by everyday CPUs
and GPUs. Investment-coins have a few weeks to months where
you have to spot the coin, be convinced it's not a scam and send
over your money.
Not true at all. Dogecoin was mined for 3 days very easy, for another 5
days quite easy and after that time it was much harder to get those
millions. Who was mining dogecoins in first week, earned up to 100.000$,
if he sold his Dogecoins after price of DOGE was raised 250x.
Mining keeps the entire system honest. You cant game the
system with mining, you can just add hashing power if you want
more coins. Its usually much cheaper to buy coins than mine
them, so I want to be rewarded for mining.
True. It is cheaper to buy coins. Thats why if you want to mine Nxt, all you
need is to buy NXT. You cant game the system too by Nxt mining. Buying
Nxt is as same as buying more GPUs. But you still pay same low electricity.
23
In the present an everyday GPU will most likely never generate a profit
mining bitcoin. They are either mining alt-coins to recoup or gain free
profits or sold on e-bay to others looking to mine alt-coins.68
So basically, you have a large number of miners that get very cross
when they are told they cannot mine a particular coin, because they
already invested in the hardware. Even if another non-mining distribution
scheme is legitimate, they won't like it because they already invested into
the mining distribution scheme. (Unless that scheme involves giving out
"free stuff") 69
The only reason mining has gotten so big (and survived) is because of
basically useless copy-cat coins. If you could only mine Bitcoin + Litecoin,
the mining scene would die very quickly because of escalating difficulty.
We are in a "copy-cat coin" bubble. This wont be a permanent thing.
Once people realize that 99% of altcoins are just mine and dump schemes,
no one will invest in those PoW coins.70
The early Bitcoin adopters had no problem accepting the PoW

system, but they can't accept the new generation of cryptocurrencies with PoS
Suppose a blockchain is forked and there are two competing
forks. In a PoW-system, miners can add blocks to either of these forks,
but can only commit fully to a single fork, since they need to expend
resources to mine. Consequently, one fork will win out in the end as it
becomes the longest, while the other chain is orphaned as miners
abandon it.71
With PoS forging, there is nothing stopping a user to forge on both
competing chains. In fact, it is economical to do so. Why bet on what you
think will be the winning chain when you can back both. This can cause a
69 Dtto.
70 Dtto.
24
situation where two competing chains coexist for a long time, damaging
the credibility of the coin.72
-
Nxt came with transparent forging idea that solves the problem of
competing chains. This invention is really very important for PoS
currency. A Nxt node forging two chains at once will find their mining
power reduced to zero.
What about power heating houses by Bitcoin mining?

In the USA alone 3 million homes use electric heat. Using a pc with two
hd7950's at Litecoin will provide heat and make money. You will have 60gh
at BTC and about 1200kh at LTC and it will use about 700 watts of power.
You can use this energy for electric heated home.73
This is true, but there is a problem with ROI return of investment. The
difficulty of Bitcoin mining is always rising. Big corporations and very rich
people are using more superstrong miners. What you mined in 2013
during 1 day, you will mine in 2014 during a month with the same gear.
Mining by using hd7950 will be over very soon. You can buy a Raspberri Pi,
it is cheap and uses almost no energy. You can use Raspberri for Nxt
mining and also as a radio, media streamer Or for arcade games.
Why is Nxt mining so cheap?
Well think about it, bitcoin is a decentralized currency. Instead of the
banks buying paper and printing money with their machines, we "print"
(mine)
"money"
(Bitcoins/altcoins)
with
our
"machines"
(CPU/GPU/FPGA/ASIC). So PoW use their system, but it is unnecessary.74
A rising amount of energy is "wasted" in mining the coins. As more
computers become engaged in mining them, the equations which need
solving become more complex - And more and more energy is engaged in
a useless "mining activity". In effect, Bitcoins are created through wasting
energy in useless mathematical equations. There must be a better way to
distribute the new coins than giving them away to people who waste
energy to gain the potential of "earning" free coins.75
72 Dtto.
75 GuidoFox, https://www.youtube.com/watch?v=ktMGCNq9Zo&google_comment_id=z123zfz5jvmygzjfi22yhp1iwnvbf1p5z04.
25
Too many big players invested a lot in mining/ASIC related business.

They will try to stop PoS currencies. They were the bosses of Bitcoin in the
end of 2013. They are and will be trying to spread FUD about how bad is
PoS.76 Fortunately in decentralized community people can have their own
opinions. People in the past also mined a coal and now they use solar
energy. And yes, you can mine Nxt on small widgets only by using solar
energy!
If you use Raspberry Pi for securing the network, it costs you $100
per year + $100 original investment. If whole network can be secured by
10.000 Raspberry Pi, then it costs $1.000.000 per year. Someone says
Bitcoin mining costs $15 million per day. Even if he is wrong and it is
$1 million per day, raspberry pi's are still 365x cheaper (if you use 10.000
of them).77
26
You can play Call of Duty during Nxt mining

This is true, Nxt needs only a little RAM from your PC. You can finally use
your graphic card only for playing 3D games. With more PoS currencies
and after all PoW coins die all gamers will finally be able to buy cheaper
graphic cards. And they wont be all sold out like today!
Nxt requires 10 times less bandwidth and storage than Bitcoin.
It uses signing algorithm which is faster than Bitcoin's one. Thus
it can scale to a higher degree than Bitcoin can. There is no an
implemented decentralized solution of the VISA volume problem yet.
Should we sit and do nothing waiting for it?78 No, we can use Nxt.
Why shouldnt we use PoW mining?
The proof of work model is unsustainable in terms of the energy
requirements to secure it: http://www.bitcarbon.org/introduction.html The
above isn't an issue now as not enough people around the world have
adopted PoW coins. But if they did, this would be at the front of most
political arguments. Also, the vast majority of bitcoins is also held by a
minority - not just in BTC but also in hashing power. In many respects,
Bitcoin is a ponzi/pyramid scheme too. Hell, so is FIAT. Such is the nature
of currencies in general. Bitcoin was also considered a huge scam back in
its infancy.79
POW is such a waste of resources, we are spending millions on
resources to mine BTC, it doesn't seem like the direction we should
continue heading as the world struggles with limited resources. The
amount of power wasted mining BTC is absolutely atrocious. Regarding
your concerns with POS, read up on Transparent Forging.
POW is
completely susceptible to corporate control, look at the mining pools, you
are close to 51% with Ghash.io alone. Meanwhile Nxters are forging NXT
right now on their RasPi.80
Isnt late to start with Nxt?
You can get into the Proof of Stake system at almost any point, which
definitely drives adoption. You have to pay for NXT, but then you can mine
79 https://www.youtube.com/watch?
v=zALTChPsXhQ&google_comment_id=z12yurmjfseai3rhb04cdlsijvfjt33z0sc0k.
27
NXT and thus get into the system without investing more fiat money. This
is also the reason why Nxt has a rather fast adaption compared to Bitcoin.
28
What is Proof of Stake?

Proof of stake does away with the computational waste of proof of work
entirely. Rather than requiring the prover to perform a certain amount of
computational work, a proof of stake system requires the prover to show
ownership of a certain amount of money. 81
The reason why Satoshi could not have done this himself is very simple:
before 2009, there was no kind of digital property which could
securely interact with cryptographic protocols. Paypal and online
credit card payments have been around for over ten years, but those
systems are centralized, so creating a proof of stake system around them
would allow Paypal and credit card providers themselves to cheat it by
generating fake transactions. IP addresses and domain names are partially
decentralized, but there is no way to construct a proof of ownership
of either that could be verified in the future. Indeed, the first digital
property that could possibly work with an online proof of stake system is
Bitcoin (and cryptocurrency in general) itself.82
But proof of stakes real advantage is in decentralized systems like
Bitmessage. Currently, Bitmessage uses proof of work because it has no
other choice. However, proof of work is wasteful, and makes Bitmessage a
somewhat cumbersome and power-consuming system to use for instant
messaging. Soon a system like Bitmessage will be integrated into Nxt and
use it as proof of stake. Finally much of the difficulty and waste will be
alleviated.83
Does proof of stake have a future? Bitcoins security will become too
weak over time as its block reward continues to drop. PPCoin is not fully
proof-of-stake; because it is a small cryptocurrency with a highly
centralized community. A centralized checkpointing system does exist,
allowing developers to create checkpoints that are guaranteed to remain
part of the transaction history forever.84
81 http://bitcoinmagazine.com/6528/what-proof-of-stake-is-and-why-it-matters/
29
Eventually, the intent is to move both toward making the

checkpointing system more decentralized and reducing its power and
PPCoins come to be owned by a larger group of people. 85 As usual, Nxt
again came with right solution: Merged mining. Thanks to this feature
centralized checkpointing system will never be a problem in Nxt.
Peercoin and Nxt use an alternative mining mechanism called proof
of stake where users mine with money rather than computing power;
although this alternative mechanism is relatively unproven, it is extremely
promising because it is essentially impossible to set up a mining pool with
it.86
People crying that with PoS you make little money forging don't realize
that your ROI (Return of Investment) as a particular in PoW mining usually
is -50%. The main advantage of PoS forging is that you're
guaranteed to not lose anything (also you won't get high profits). You
will get fair profits. Instead in PoW you're guaranteed to being fooled by
the ASIC sellers87
PoS will survive all PoW attacks88
A proof-of-stake system might provide increased protection from a
malicious attack on the network. Additional protection comes from two
sources:
-
Executing an attack would be much more expensive.

Reduced incentives for attack. The attacker would need to own a
near majority of all Nxt. Therefore, the attacker suffers severely from
his own attack.
Why Proof of Stake would likely decrease long-run txn Fees

considerably89
Under pure proof-of-stake, opportunity cost can be calculated as the total
sum spent on mining labor and the market interest rate for risk-free NXT
86 http://bitcoinmagazine.com/9402/mining-pool-centralization-crisis-levels/.
88 https://en.bitcoin.it/wiki/Proof_of_Stake
89 https://en.bitcoin.it/wiki/Proof_of_Stake
30
lending (hardware-related costs will be negligible). The total volume of txn

fees under pure proof-of-stake will just need to be just sufficient to
compensate labor involved in maintaining bandwidth and storage space.
The associated txn fees will be exceptionally low. Despite these
exceptionally low fees, a proof-of-stake network will be many times
more costly to exploit than the proof-of-work network.
Approximately, a proof-of-work network can be exploited using
expenditure equal to about one years worth of currency generation and
txn fees. By contrast, exploitation of a proof-of-stake network
requires purchase of a majority or near majority of all extant
coins.
31
7. Rich get richer

I dont understand the positive associations with proof of stake.
Isnt it a model which increases the power of the rich (owners of
the coins) guys, very similar what we have in real life? Doesnt
that lead to power monopols?
There are several problems with PoS "mining" that are not present in PoWsystems. For one, PoS suffers from a rich-get-richer problem, since forging
typically requires coins to not move for some time. This isn't an issue now,
as everyone is mostly hoarding anyway, but if such a coin would be widely
used as general currency, people with large quantities have relatively
large amounts of coins they can save, while people with small amounts
will have to spend most or all of their coins. This will cause coin ownership
to become more and more centralized.90
-
In NXT this problem was solved. An account only has to be active for
1440 blocks before it can forge, so it doesn't matter what the user
decides to do with their coins after.91
That is a genuine concern especially with a purely POS coin such as

Nxt, but significantly less so with a combination POS/POW coin such as
Peercoin, since the initial generation and distribution of coins works the
same way as for bitcoin. Plus the rich-get-richer, and more powerful,
phenomenon is somewhat of an issue also for POW since POW mining is
so costly, and those who can afford the computing power generate
wealth to then increase their computing power even more, with
better and more expensive hardware. POS minting can be done with
almost any hardware, and at least with Peercoins, it is not just the amount
of coins but also their age that matters (age resets upon successful
minting or transfer to another address).92
With Nxt's PoS forging, the ROI is the same percentage whether you
invest $100 or $100000. This is as fair as it gets. Both investments will
grow at the same rate. PoW mining such as that used in Bitcoin is not this
fair. Why? Because the nature of hardware/electricity costs and economy90 https://bitcointalk.org/index.php?topic=411279.msg4465089#msg4465089
92 http://bitcoinmagazine.com/9402/mining-pool-centralization-crisis-levels/
32
of-scale gives an advantage to the rich. For instance, they can buy 100 or
1000 miners (or manufacture their own!) for a much better deal than the
little guy who can only afford one.93
The person with 1 million Nxt has 100x higher chance to get the
transaction fees than the person with 100 Nxt. He still pays the same
electricity. The person with 1 million GPU miners has 100x higher chance
to get Bitcoin block than the person with 100 GPU miners. But he pays
100x more for the electricity.
Economies of scale are a real problem for PoW cryptos. A
person who invests 10 billion gets WAY more than 10 times as
much hashing power out of that investment as someone who
invests 1 billion.94
A person with 5 NXT only forges 5 times as many as someone with 1
NXT. Its not like there is some advantage to having a lot in that respect,
its not like someone with 5 NXT gets to forge 6 times as many as
someone with 1. It will only lead to stratification if people with smaller
amounts of NXT don't feel that it is worth their time to forge. Ideally we
will have clients someday that give no barrier to entry for someone who
wants to forge with even a single NXT and so there will be no reason for
him not to and so no stratification.95
World of Bitcoin:
-
If you have 1000$, you can mine X Btc thanks to the GPU
If you have 100.000$, you can mine 1000X Btc thanks to some
super machine you buy
if you have 100x1000$GPU, you get 100X Btc (+ pay 100x for
electrocity)
if you have 1x100.000$Machine, you get 1000X Btc (+ pay for
electrocity)
World of Nxt:
-
You have 1000 Nxt, you can mine X Nxt

You have 100.000 Nxt, you can mine 100X Nxt
So in the world of Bitcoin, it is Rich get richer. In the world of Nxt,

it is LINEAR!
33
Only PoW is unfair and rich gets richer

Those that invest a 6 year old laptop to mine bitcoin are going to be
severely disappointed. Yet those that have $20,000 laying around, can
afford to buy a top of the line mining rig. And those people will actually
turn a profit, but will always have to re-invest in hardware that becomes
obsolete because of competition. So with the GPU/CPU world, the rich are
going to get richer and the poor get nothing. You cannot expect to invest
less than $100 and get anything in return in PoW system.96
Many people thing that with PoW, due to economies-of-scale, it will
always be easier for the rich to secure an increasingly greater percentage
of the profit from mining. For example, the average Joe will have to spend
top dollar to buy one miner. But someone (or government/corporation)
who has a lot of money can either buy them en-mass and receive a huge
discount, or manufacture them directly at an even larger discount. This
means that the little guy's slice of the PoW pie will get increasingly smaller
because it will always cost him more to maintain his hash rate, while the
rich who are already making a much higher ROI will always be able to
maintain their advantage at a discounted cost. 97
In PoS the ROI is the same regardless of how much money you
have.
As a simple example, suppose we have a PoS network of 100 people, and
they all have their accounts open for forging 100% of the time. The richest
person has 5% of the total wealth, the poorest person has 0.01% of the
total wealth, and everyone else has something in between. For simplicity's
sake, let's assume this is a closed system and no new wealth enters the
economy. Let's also assume the richest person decides to be a "parasite to
society and offer NOTHING back", i.e. he just sits on his 5% and collects
fees from forging.98
Now, the poorest person doesn't have this option, so he decides to be
industrious and starts a business that provides him a moderate amount of
income that allows him to earn more than his cost of living/doing business.
After one year in this economy the poorest person will still have no less
than 0.01% of the total wealth thanks to the interest he earned on forging,
96 https://nextcoin.org/index.php/topic,3413.msg32470.html#msg32470.
97 https://nextcoin.org/index.php/topic,3474.msg32974.html#msg32974.
98 Dtto.
34
and will in fact have gained extra wealth thanks to his successful business.
Let's say he now owns 0.02% of the total wealth.99
Now let's look at the richest person. After one year of doing nothing
except collect transaction fees from forging, he earns no more than 5% of
the total interest from forging thanks to the way PoS forging works.
However, he had living expenses, so we must subtract these from his
earnings. Let's say he was wise and didn't exceed the amount that he
earned from forging; however, when you subtract his expenses from his
forging profits, his net income for the year is obviously less than 5% of all
interest earned from forging that year. Since everyone else was also
forging 100% of the time, this means his wealth has grown at a slower rate
than even the person who earns just enough from his job to pay for his
living expenses.100
Suppose this continues unchanged for the next 10 years. Each year the
parasitic rich person's wealth grows at a slower rate than the basic forging
interest rate, and each year the poorest person is able to increase his
wealth at a greater than basic forging interest rate, thanks to his
savings.101
This is just a little scenario to illustrate that in PoS, while the rich may
be able to sustain their lifestyle by doing nothing but forge, their wealth
will grow at a slower rate than anyone who has a job that can support their
living expenses, so long as everyone is forging. Forging is a trivial task, so
there is no reason why everyone shouldn't be able to forge. Who is
rewarded the most in a PoS system? The industrious, just like in every
other healthy economy.102
PoW economy103
Now let's take a look at a simple PoW economy. Again, let's suppose this is
a network of 100 people, the richest person has 5% of the wealth and the
poorest person has 0.01% of the wealth, and no new wealth enters the
system. Lets be optimistic and assume everyone is committed to mining,
99 Dtto.
100 Dtto.
101 Dtto.
102 Dtto.
103 Dtto.
35
and they all set aside 10% of their wealth to pay for mining hardware and
electricity costs.
The poorest person can only afford one of the newest ASIC miners, and
since he is only buying one, he pays the full retail price. The richest person
realizes that he can save a lot of money by manufacturing his own ASIC
miners, and he can even sell some to the other members. So he sets up a
nice little ASIC farm of 1000 miners for himself which he was able to
finance for much less than full retail, and he pockets the money the
poorest person and many of the other members gave him to buy one of
his miners.
So, at the end of the year, the richest person owns a large percentage
of the 10% everyone set aside to pay for their mining costs, and he was
also able finance and operate his miners much more cheaply, giving him a
much higher ROI. So the richest person has earned much more than 5% of
all mining profits for the year, and the poorest person has earned much
less than 0.01% of all mining profits for the year.
The poorest person is a pretty industrious guy though, so he has his
own business which has enabled him to earn a small profit, and he's doing
okay, and he might just be able to justify upgrading to one of the new
model of ASICs that the richest person is releasing for next year. His
neighbor is not so industrious though, and he is thinking he won't be able
to afford a new mining rig next year.
Obviously, the richest person in this example is also industrious,
because he set up an ASIC manufacturing business, but this is an
opportunity that is only afforded to the rich. Lets say his neighbor, who is
not quite as rich, and not as industrious, simply bought 800 ASIC miners
from him at a 40% discount rate from full retail, and then sat back and did
nothing all year except to be a "parasite to society and offer NOTHING
back". Well, he is still receiving a MUCH higher ROI than the poorest
person who could only afford one miner at full retail.
The distribution of wealth in a Bitcoin economy can be altered
much more easily in comparison to a 100% PoS coin economy
It can be altered much more easily in favor of the rich than a purely
PoS economy.104
36
Market Cap: Corporations vs. Cryptocurrencies

Andreas Von Bechtolsheim is one of the two investors in Google. He
invested US $100.000 in Google in September 1998. 105 Andreas now at the
age of 58 has net worth of US $ 2.8 Billion. 106 If you invested early in very
profitable corporation, you became rich. It is very similar in successful
cryptocurrencies, as you can compare:
Starbucks
Market cap in Q3
1992
Market cap in Q3
1995
Market cap in Q4
2010
Yahoo
Market cap in Q2
1996
Market cap in Q2
1998
Market cap in Q4
2010
Amazon.com
Market cap in Q2
1997
Market cap in Q2
1998
Market cap in Q4
2010
1000% growth in 12
quarters
$111 million
$1.26 billion
$24 billion
1000% growth in 8
quarters
Bitcoin
Febuary 2010
$ 20.000
January 2011
$5 Million
January 2012
$14 Million
January 2013
$140 Million
January 2014
$12 Billion
Litecoin
$551 million
$7.38 billion
$19.1 billion
1000% growth in 4
quarters
$441 million
$4.95 billion
$81.2 billion
September 2013
$50 Million
December 2013
$1.2 Billion
January 2014
$600 Million
Dogecoin
16 December 2013
$1 Million
19 December 2013
$14 Million
January 2013
$8 Million
Nxt
eBay
Market cap in Q3
1998
Market cap in Q1
1999
Market cap in Q4
2010
1000% growth in 2
quarters
$1.81 billion
$16.6 billion
$36.7 billion
November 2013
$21
Bitcoins
4 December 2013
$3 Million
24 December 2013
$24-43
Million
26 December 2013
$101 Million
105 http://www.wired.com/science/discoveries/news/2007/09/dayintech_0907.
106 See http://en.wikipedia.org/wiki/Andy_Bechtolsheim.
37
January 2014
$60 Million
Sources:
http://www.businessinsider.com.au/fastest-growing-large-companies-2011-2
http://en.wikipedia.org/wiki/History_of_Bitcoin
historical charts, http://coinmarketcap.com/
38
8. Innovations over Bitcoin

It's hard to scam in proposed scheme. He [BCNext] promised to launch Nxt.
All main features are completed and Nxt can be launched even today. I can
do it by myself after I figure out how to create Genesis block. Disassembled code
is quite ugly but readable. This coin is the most innovative among all other coins
I supported, so if BCNext is hit by bus I will launch it. 107
Come-from-Beyond
I updated my server to show BCNext the stock exchange interface. 108
Come-from-Beyond, November 14, 2013
Besides Bitcoin, Nxtcoin ist the best I've seen so far. No clone, completely
new code base, with 100% PoS, DNS, Messaging, Decentralized exchange,
colored coins, no mining but "forging"... definitely better than any other clone altcoin.
McDoxy, trollbox
I have not invested in any altcoins because I don't believe that any of the
"problems" or issues that they address can't be addressed by Bitcoin itself.
Cameron Winklevoss, before release of Nxt
Luckily for us, Nxt solves this problem by giving a way to "inflate" number of
"coins" via Asset Exchange. These "coins" can be backed by NXTs.
If u think about it, you'll notice that Nxt simulates real economy (NXTs ==
gold, issued assets == paper money)109
Come-from-Beyond
109 https://bitcointalk.org/index.php?topic=345619.17560;topicseen
39
Early altcoins are highly vulnerable to 51% PoW attack. Nxt is not. Early
altcoins are mostly pump-n-dump shitcoins, lost user base quickly. Nxt is not. Nxt
was highly vulnerable to zombie attack.110
ImmortAlex
Q: What's currently the plan regarding exchanges and stuff?
Come-from-Beyond: Launch decentralized exchange and let centralized ones
to die.111
The Great Cycle of a altcoin, fork of Bitcoin or fork of fork of Bitcoin,

or :
(1) Coingen.io ---->
(2) Pay and Generate ------>
(3) Copy and paste another shit coins article ----->
(4) Post Shitcoin gets accepted ----- >
OR
shitcoin hoarders -> 1
----- > Dies from being too shity even for
(5) Reward bounties for supporting shitcoin ----- >

(6) Shitcoin Giveaways ----- >
(7) Try to get on a trade site ------>
OR
lowest form of shit -> 1
----- > Never gets accepted, because it's the
(8 ) Gets accepts and slowly dies because no more money is to be made off
of shitcoin.
OR
step 1
----- >
All support is lost for shitcoin, back to
(9) In very very rare cases such as Doge ----- > Gains massive appeal and
fame for being a new breed of shitcoins, Dies in 6 months. -> back to step 1 112
Nxt:
1. Invent and create a new system Nxt
111 https://nextcoin.org/index.php?action=profile;u=74;area=showposts;start=15
40
2. Create a plan, divide it in 3 parts. Share only first part of the PLAN. Start
with a cryptocurrency
3. Share the coins to the original stakeholders after fair 2 months long IPO
4. Implement all existing functionalities very slowly, so the price of NXT can
be low for many months
5. Leave everything decentralized
6. Share the second part of the PLAN, wait 6 months to achieve 1 million
accounts
7. Share the third part of the PLAN to achieve 100 million accounts
8. Change the world
41
Innovations of Nxt - Features

Nxt Features
Running
Decentralized
Alias System
Basic DDoS
Protection
Arbitrary
Messaging
Prepared
Decentralized Asset
Exchange
In progress
Decentralized
Marketplace
Concept not ready

Decentralized Mixing
Service
Colored Coins
Distributed Storage
Distributed Computing
Transparent Mining
Multi-signatures
Blockchain
Shrinking
Two-phase
Payments
Voting System
Reputation System
Smart Contracts
Instant Transactions
Bitcoin Features
Running
Multi-signatures
Hardware Wallets
Prepared
Colored Coins
42
Hardware Wallets
Advanced DDoS
Protection

NXT Myths: What Should We Know About NXT Generation PoS Cryptocurrency

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Nxt Myths

What should we know about Nxt generation PoS Cryptocurrency

Worthless coin without mining...................................................17

Rich get richer...........................................................................25

Innovations over Bitcoin............................................................30

NXT Donations: 15003961341330858247

1. Nxt is not a scam, it wasnt created by anonymous

On January 2014 joined Jean-Luc a core team as a non-paid programmer. 6 He

11 The list of original stakeholders is hardcoded to the sourcecode. More in the

16 Bulgaria(1), Canada(2), China(2), Czech Republic(4), France(6), Germany(22), Hong

About BCNext, inventor of Nxt

What others said about BCNext:

I don't think BCNext is interested in money. He spent more than he raised

What else do we know about BCNext?

BCNexts likes symbols:

3 January: the release of Nxt happened 5 years after the release of

Funny descendants of Nxt:

2. The very fair Distribution of Nxt

The distribution of Nxt has many phases:

Original IPO: (1 NXT = 2 Satoshi) = (September 28 - November 18 = 61

If all coins are in existence already, doesn't this make the

success or return on investment.33 In order to get more users they started

Why was the launch of Nxt speeded?

What happened with the 21 Bitcoins?

How is NXT distributed?

If I don't count Genesis transfers, in 52 days were transferred: 2.25 Billion

20.7%: 99.76% : 1.500x

20.7%: 98.928% : 20.000x

Other 3 million addresses own 15 million Litecoins. 42

42 richest original stakeholders

when the algorithms are groundbreakingly better than anything that's

I am amazed how motivated, innovative, and intelligent (sometimes I

A brainwallet is created simply by starting with a unique phrase. The

6. Worthless coin without mining

The early Bitcoin adopters had no problem accepting the PoW

What about power heating houses by Bitcoin mining?

Too many big players invested a lot in mining/ASIC related business.

You can play Call of Duty during Nxt mining

What is Proof of Stake?

Eventually, the intent is to move both toward making the

Executing an attack would be much more expensive.

Why Proof of Stake would likely decrease long-run txn Fees

lending (hardware-related costs will be negligible). The total volume of txn

7. Rich get richer

That is a genuine concern especially with a purely POS coin such as

You have 1000 Nxt, you can mine X Nxt

So in the world of Bitcoin, it is Rich get richer. In the world of Nxt,

Only PoW is unfair and rich gets richer

Market Cap: Corporations vs. Cryptocurrencies

8. Innovations over Bitcoin

The Great Cycle of a altcoin, fork of Bitcoin or fork of fork of Bitcoin,

----- > Dies from being too shity even for

(5) Reward bounties for supporting shitcoin ----- >

----- > Never gets accepted, because it's the

All support is lost for shitcoin, back to

Innovations of Nxt - Features

Concept not ready

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