What Is NEM?
The NEM story began on January 19, 2014, when a user of a well-known forum began discussing the introduction of a new cryptocurrency. He received support from other members of the forum, and was so inspired by this idea that on June 25 of the same year, he introduced the alpha version of the currency. In October, he launched the beta version of the NEM coin. The stable version was released in Japan in March 2015. For several months, the currency gained popularity in Japan, then in other Asian countries before entering the world market.
NEM, a- new economic movement, is a mixture of the best features of Ethereum, Bitcoin, and Ripple. The platform is ten times faster than the Bitcoin network. It provides the ability to conduct an ICO, so in order to attract investments through initial coin offerings, developers can use this system. In addition, the project team has ambitious plans and goals for integration into the banking sector: they want to cooperate with banks around the world. The team plans to make NEM a cryptocurrency that will be used in all areas of the economy.
The NEM coin network went not only beyond the borders of Asia, but also beyond the limits of cryptocurrency. The most famous example of using the NEM blockchain is the Mijin project for banking operations, which is already widely used by organizations all over the world. And this is not only in the financial sector. The platform is used in logistics, online games, and other areas.
NEM Technical Features
The NEM Smart Asset system allows the creation of fintech systems, tracking logistics, ICOs, document notarization, decentralized authentication, etc. The popularity and prevalence of the system as a whole, in particular the NEM cryptocurrency, became possible as a result of its technical features.
Proof of Importance
Proof of Importance (PoI) is a cryptocurrency consensus confirming importance, and it is the core of the NEM blockchain. This is a modification of a fundamental principle in cryptography: confirming the share of PoS. The NEM team was the first to introduce Proof of Importance to the blockchain. POI is in some ways similar to PoS, but it includes more variables. The maximum importance of the user depends on three indicators: the number of coins, the number of transactions carried out, and the duration of the account. Thus, the POI approach encourages not only saving XEM coin, but also using coins.
POI uses an algorithm that considers 3 factors, included in the table below.
Harvesting and Delegated Harvesting
In the terminology of the NEM blockchain network, getting a reward for a block is designated by the word harvesting. Any person who installs a master pack on his or her computer can be a harvester. The condition for harvesting is as follows: the minimum balance of the wallet must not be lower than 10,000 XEM. The harvesting process does not allow the mining of new NEM coins; this is just a “reward” for confirming transactions.
So, we can say that the NEM blockchain harvesting is a kind of replacement for ordinary mining: everyone who manages nodes gets bonuses for it. In addition, “harvesting” consumes a lot less electricity than mining. Thus, XEM coin is much more energy efficient than Bitcoin.
Harvesting has several advantages over other types of methods:
- It does not require special equipment.
- It is environmentally safe and inexpensive, because there is no additional electricity utilized.
- Using blockchain increases your chances of harvesting a block.
- You can continue harvesting while the computer is off.
Part of the concept of creating the NEM coin was a system that would give power to users, not treasures or mountain farmers. Ensuring fair, transparent and proper stimulation of harvesting is central to the goal of NEM blockchain.
When your account harvests a block, it confirms all transactions in that block, constantly adds them to the blockchain, and automatically collects all transaction fees in this block.
NEM cryptocurrency is the first blockchain to implement delegated harvesting. This is an effective way to combine account power without providing any secret keys. To do this, you connect your account to an existing remote site and use the computing power of this account to complete the lock on your behalf.
Each account has a POI (Proof of Importance) rating that determines its chances of harvesting a block. With delegated harvesting, you provide your POI account to this remote node, thereby increasing its chances of harvesting a block on your behalf.
Today, the vast majority of wallets use delegated harvesting. It is worth noting that in order to activate a delegated mode, you must run a confirmation. This takes 6 hours and the activation is initiated from the official NEM cryptocurrency wallet.
Catapult: NEM Blockchain Engine
As noted in the NEM blog, Catapult is designed not only to significantly expand the capabilities of blockchain, but also to give it greater speed and scalability. The developers are convinced that the functionality implemented by them was not previously represented in any of the existing blockchains.
In Catapult, also known as Mijin v.2, unique capabilities are realized based on smart contracts. In particular, users will be able to create secure digital assets and decentralized swaps. Catapult also implements an expanded accounting system, the ability to perform aggregated transactions, and an advanced business logic modeling system. This new engine is a major update written from scratch in C++. The update should occur first in the private Mijin blockchain, and then in the NEM public chain.
Another Catapult feature is the ability to create multi-level accounts with multi-signature. For the first time, through the blockchain, the logic of “Yes / No” is added to multisign-transactions as “nested signatures,” which allow the implementation of a huge variety of different business algorithms.
Aggregated transactions combine several transactions into one. This opens up opportunities for non-trustworthy decentralized swaps, automatic cross-chain transactions, and other advanced algorithms. For their implementation, Catapult generates a one-time smart contract. All component transactions are carried out simultaneously if the parties approve the transaction. According to the developers, the function is currently implemented only in Catapult.
The user can set up an account in such a way that it can only be restored if there are signatures of selected third-party accounts (for example, belonging to family or friends).
Production and Supply Chain
In addition to regular payments, users can also exchange any digital information, including certificates, reports, etc. For example, Catapult multi-level/multi-sign accounts can interact with product delivery scanners and automated production equipment.
Suppose a manufacturer ships pharmaceutical products, which can be awarded a quality certificate only if the entry in the blockchain contains the date of manufacture, information about passing the security check, and information confirming that the goods were delivered to the recipient under acceptable temperature conditions.
Catapult high performance is provided via four-tier architecture. At the same time, no layer can be slowed down by other levels. Thus, API calls and data requests can respond quickly, even in dense traffic conditions. This, in particular, allows developers to update or change the security settings of any of these levels without interrupting the rest.
Catapult technology opens up a wide range of use cases for various fields, such as:
- currency transfers and international payments
- security trading
- IOT micropayments
- ICO and release of utility tokens
- loyalty programs
- audit records
- data notary
- copyright management
- economics of joint consumption
- collectible cards
- customer relationship management (CRM systems)
- storage and management of medical records
- automatic accounting
- user identification
- management of event logs
- recording of scientific data
- encrypted messaging and storage of the latter
- social networks, etc.
New Economy Movement Advantages
The advantage of NEM blockchain lies primarily in the technological simplicity of handling it. Corporate software and wallets can be downloaded and installed on a computer by anyone, even those with little knowledge of cryptographic nuances.
The main NEM blockchain advantages are portrayed in the image below.
XEM coin has many valuable features from which it greatly benefits, even against the background of Bitcoin or Ethereum. They include:
- Work speed: Each block in the NEM blockchain ecosystem is generated in one minute, and this indicator surpasses all other known cryptocurrencies in technical quality. Bitcoin needs 10 times more time.
- Instant transactions: They pass immediately, and wait for confirmation no more than a few seconds. Now, the system can carry out up to 4,000 transactions at a time.
- A high level of protection against cyber attacks and hacks. Reliability of the XEM coin is ensured by using Eigentrust++ and an incentivized public node network based on two-tier architecture.
- Maximum open system. Strong protection does not exclude transparency. The source code for client platforms is open and available on GitHub. Additionally, transactions with NEM coin are carried out in a few seconds worldwide. These financial transactions do not depend on other payment systems.
- Easy to use. All tools and programs that are needed to work with the system can be downloaded directly from the official website of the developer. There are versions for all operating systems, including mobile ones. By the way, the site provides comprehensive information about the NEM cryptocurrency platform itself, including the white paper (the “white book”) – a document that contains complete information about the project, team, goals, and plans.
- Currency is not subject to inflation. There are already 9 billion XEM in the network today, and this is the final number of the cryptocurrency. No re-emissions in the system are assumed.
- Low commission. A fixed fee is charged for using the NEM blockchain network: 0.01% of the commission amount. Whether you transfer one NEM coin or a thousand, the percentage will be unchanged. Bitcoin commission does not depend on the amount, and it is $2. For small remittances, it is wiser to use XEM coin.
- Supernodes program. This rewards owners of network nodes (active nodes). These nodes protect the network, so they must meet all the requirements for bandwidth, speed, chain height, and more.
NEM Price Rate and Its Dynamics
In order to understand the position the NEM cryptocurrency currently holds, it is worth assessing its dynamics according to trends of different scales. Despite the comparative youth of cryptocurrency, the NEM coin managed to survive two peaks of abrupt growth and capitalization waves, which caused the token to take a leading position in the Japanese market.
At the very beginning of this cryptocurrency path, 1 XEM coin cost only five cents. Developers foresaw a smooth growth rate. At the end of 2016, however, Japanese banks became interested in cryptocurrency, after which the price of one coin increased fivefold. For about a year, the rate hovered around 30 cents per coin. And this was despite the fact that all this time, developers had been perfecting the system, even launching a private network to conduct banking operations. Their efforts were not in vain.
In the middle of 2017, there was a second leap in the course of development. The reason for this was the signing of an agreement with the large Japanese bank NRI. The bank owners decided to test the capabilities of NEM blockchain before signing the contract. They found that the network perfectly withstood strong loads (during testing, more than 2 million financial transactions were performed throughout the day). These indicators were also of interest to other financial organizations of the homeland of NEM coin as well as other countries around the world supporting the young currency. This helped the XEM coin step over 50 cents. In 2017, NEM cryptocurrency capitalization increased significantly. If, at the beginning of the year, the value of all coins was equal to $2.5 billion, by the end of the year, this figure had grown to $9 billion.
The new 2018 currency has set a new record: $1.07 per coin. Growth continued until January 5, when the maximum price of the token was $1.66. Then came the crisis: the fall. The price in dollars began to decrease. The rate has fallen, and is now unstable – it fluctuates around 10 cents. How the price of the XEM coin has changed throughout its history, and whether it will grow, you can understand by looking at the exchange rate with the dollar (online below).
Experts give several reasons. First, you already know the news about the theft of funds from the Japanese exchange Coincheck. Second, the introduction of certain rules and restrictions in the use of cryptocurrencies at the state level also played a role.
The price of the XEM coin is portrayed in the graph below.
Nevertheless, we are sure that this digital currency definitely has a future. The following factors speak in favor of long-term success:
- Orientation to the real economy. This is important, given the growing opposition between the cryptocurrency market and the state apparatus. Almost every day, there is news about the incredible efforts that government agencies are devoting to curbing the crypto-money market. It is in their interest not to try to tame digital currencies, but to cooperate with them. In this regard, NEM cryptocurrency fits perfectly within the real banking model. That is why the XEM coin is in the lead among cryptocurrencies that could be recognized at the state level in the future.
- Collaboration with large organizations. NEM blockchain partners include not only the largest Japanese bank, NRI, but also a number of large Malaysian, Japanese, and South Korean banks, as well as the leading company Tech Bureau and the consulting organization Blockchain Global Limited, from Australia.
- Wide range of applications. NEM wallet is already used for instant world transfers, payment for goods and services in online stores, and, of course, banking operations.
XEM Mining and Storage
Earning and receiving at the expense of a certain number of NEM coins is possible with the processing of committed and ongoing transactions. The speed of search and the rate of earnings depends upon the productive power of the computer. Therefore, users have several opportunities to earn with NEM:
- Purchase all the necessary components for the organization of powerful mining farms based on ASIC or FPGA processors.
- Connect your computer to a common NEM blockchain network.
- Earn coins using cloud mining.
For making money and storing the NEM cryptocurrency, you will need a specialized NEM wallet. To create this, you’ll need to go to the NEM Wallet section on the official website and download the client in the required format. After launching the installer on your computer or mobile gadget, you’ll need to choose one of three options in the “Registration” section: a simple wallet, a smart wallet, or a wallet with a private key.
The difference between a simple wallet and a smart wallet is the security settings. The advantage of a smart wallet is that you can log into your account using just one password, without an associated file with the .wlt extension. A private-key wallet is useful if you already have a private key from an account created earlier, or a private key from the main account of a previously-created NEM wallet.
An investor who plans to invest in XEM coin should also familiarize him/herself with all possible ways of storing this currency, and select the appropriate option. In general, exchanges and cryptocurrency wallets of various kinds are used to store digital money. If you do not plan to trade daily, storing XEM on the exchange is not an option. For security reasons, it is best to use a cryptocurrency wallet.
One of the most reliable wallets supporting NEM is the NEM Nano Wallet. It can be installed on a desktop computer or laptop with Windows, Mac, or Linux operating systems. There is also the possibility to download the version for iPhone or Android, in which there are many functions — for example, transaction tracking. However, users prefer the desktop version.
Now let’s figure out how to install the NEM wallet on the computer:
- Go to the official NEM cryptocurrency website and find the wallet download page
- Choose the appropriate version for your operating system: Windows, Mac or Linux
- Download the installation file and run it
- Select the type of wallet you want to install: Simple Wallet, Brain Wallet (Intelligent Wallet) or
- Private-Key Wallet (wallet with a personal key). First, we recommend installing a simple wallet.
- Name your crypto NEM: enter a name. Then, in the section “Select a Network,” save the default parameter “Main net” and create a safe and secure password.
- Click “Create Simple Wallet.” Your NEM wallet will be saved as a .wlt file with a personal key.
After downloading this file, the Account Security Alert window will open. Carefully read all the information in the message, and make sure that the key and password of the wallet are preserved. Duplicate the password and private key in one safe place, and only after that click “I agree.”
Now the NEM wallet is installed on your computer. Just enter the password and you can start working.
You can also use the popular multicurrency cryptographic wallet, but keep in mind that not all of them have XEM coin in their listings. For example, Ledger Nano S NEM does not support wallets. If you want to use a multi-currency wallet and still be able to use NEM coin, Trezor wallet will help you with this.
NEM cryptocurrency is open and transparent, with a high level of privacy and security. The system provides its users with maximum safety, protecting them from frauds and scams.
Obviously, XEM coin is a good option for long-term investments. Any plan of “quickly bought – quickly sold – earn on the difference” with this currency will not work. In any case, whether or not to invest in NEM is up to you. Consider the opinions of experts, but most importantly, remember the risks, and invest a sum that will not be terrible to lose. Take into account all the conditions for investing, including the favorable rate of this currency.
Due to the active development of the New Economy Movement currency platform, this cryptocurrency expects a favorable outlook. You should definitely pay attention to this cryptocurrency if you want to engage in long-term investments.
If you want to learn more about various cryptocurrencies, go to the Applicature blog.