Nxt is a blockchain platform that builds on and improves the basic functionality of older cryptocurrencies like Bitcoin. Nxt has several core features in addition to its transaction capabilities, which includes a decentralized asset exchange, an open marketplace, a voting system, and a data storage system.
Nxt’s native cryptocurrency, NXT, is the fuel of the platform’s ecosystem. It can be used to create assets, launch decentralized voting polls, or store data on the blockchain. The coin can also be used as an external currency in the same way you can spend BTC to buy goods and services. All transaction fees are charged in NXT.
Nxt is permissionless and gives users complete freedom. Using the NXT cryptocurrency as a payment system can’t be restricted, creating a marketplace listing can’t be denied, and developers are free to create advanced blockchain-based applications using the Nxt API.
History of Nxt
Nxt was launched in November 2013 by an anonymous developer(s) known as BCNext. Their initial goal was to create a flexible blockchain platform around which developers can build applications and financial services. BCNext first proposed the idea on Bitcointalk.org and managed to raise 21 BTC in donations to launch the project. The 73 people who donated BTC received a proportionate amount of NXT when the cryptocurrency was launched.
BCNext eventually stepped away from the project, and the Nxt Foundation was created to continue development. Eventually it was unable to effectively guide the project due to a lack of resources. Jelurida, the company behind Ardor, now owns the IP rights and has taken over the project.
How Nxt Works
Nxt was originally dubbed as a “descendant of Bitcoin” but it was not forked from the Bitcoin code base. It was written from scratch using the Java programming language. Its developers have been adding new features to the platform since 2013 and they were the pioneers of many features commonly seen in other blockchains today, such as the ability to create custom assets and trading on a decentralized asset exchange built onto the blockchain. Below are some of Nxt’s core features.
Asset Creation and Exchange
Users can create custom assets using the Nxt client. Assets can represent literally anything, from coffee beans to software patents, and they can be traded on the Nxt Asset Exchange, which is built directly onto the platform. The exchange enables secure and fast trading so users don’t have to transfer assets off the platform or put their trust in external third parties.
Users can use the monetary system to create and trade tokens called “currencies.” Currencies are a special class of assets that have several extra parameters, including the ability to back them with the NXT cryptocurrency to stabilize their value. Monetary system currencies can be traded freely on the platform’s exchange and outside Nxt on external exchanges that support monetary system currencies.
The Nxt Marketplace is where users can list items for sale and make sales on the blockchain. The seller and buyer can conduct transactions directly without having to rely on external market sites.
Nxt Voting provides users with a decentralized way of arriving at a consensus. This feature can be used to create simple polls to gauge things like public opinion, political candidates, etc. Voting is integrated into the account control system and can be used to seek approval from a group of users before a transaction is completed. Voting can be open to the public (i.e. all Nxt account holders) or restricted to holders of a particular asset or currency.
Nxt does not provide transaction anonymity by default. Every transaction performed on its blockchain can be seen and traced for transparency. However, users who would like to anonymize their funds and transactions can use the coin shuffle system.
Coin shuffling enables users to mix their funds quickly and efficiently with other users’ funds. The shuffling algorithm used is based on a paper by Tim Ruffing et al. Nxt’s implementation has been reviewed and approved by Ruffing and his team. It’s the first shuffling system implemented on a decentralized blockchain.
The NXT messaging system allows you to securely send and receive data from other account holders on the platform. Messages are securely encrypted by default, but users can choose to send unencrypted data. Users can attach messages to transactions to make bookkeeping easier.
The Alias system allows one piece of text to be substituted for another. This means a long, complicated string of data can be replaced by a shorter one for convenience. Users can use a single word or phrase to represent their Nxt account details, a telephone number, a physical address, an IP address or email, a website, etc.
Aliases are registered using the Nxt client. Users can use the client to search for existing aliases and reserve unused ones. The function of an alias can be changed once it is registered.
Data Cloud Storage
The Nxt data cloud is a decentralized storage system that can be used to store all forms of data. It provides a secure method of storing, retrieving and publishing information on the Nxt blockchain. The messaging feature, for instance, makes use of the data cloud to embed data in the blockchain.
Data stored on the Nxt blockchain can remain there permanently. The blockchain provides an immutable record with tamper-proof time stamps, making it ideal for storing important documents like legal records.
Nxt vs. Other Cryptocurrencies
Nxt is considered a second-generation cryptocurrency because it brought a lot more to the table than the financial services older cryptocurrencies were famous for. Here are some of the reasons why it stood out:
Written From Scratch – Nxt is nothing like other altcoins (litecoin, peercoin, etc.) whose code is based on Bitcoin’s source code. It was built from the ground up with all-new source code.
Robust Built-in Features – In addition to financial services, Nxt also has a decentralized exchange, voting system, messaging/chatting service, coin shuffling, decentralized DNS, and more.
Proof-of-Stake Consensus – Nxt is 100% proof-of-stake. It leverages the balances of existing accounts to “forge” new blocks, rewarding forgers with transaction fees. Nxt’s proof-of-stake algorithm is efficient enough to run on small mobile devices.
No ICO – Unlike most modern blockchain projects, Nxt coin was released without an initial coin offering. The available supply of 1 billion NXT coins was released at once and distributed to hundreds of thousands of accounts through trades, giveaways, and bounties for developing the platform.
Fast Transactions – Nxt doesn’t use predicates or “scripts,” which accelerates and simplifies transaction processing.
Today, Nxt is not alone in its goal of creating a flexible, decentralized blockchain platform that can be used for more than just financial services. The New Economy Movement (NEM) was inspired by Nxt and shares its goals. It was originally meant to be launched via a fork of the Nxt source code, but its developers decided to start with a fresh code base.
Jelurida launched Ardor as a “Nxt 2.0” with a special focus on scalability. Ardor uses the same technology as Nxt, but features “child chains.” Child chains are private or public blockchains created with custom settings that are tied to the Ardor parent chain, which handles processing and security.
Buying, Storing and Selling NXT
NXT can be acquired from HitBTC, Bittrex, Poloniex, Indodax, Upbit, Changelly, CCEX, Stocks.Exchange, Aex.com, and Livecoin. Coins can be securely stored in the NXT wallet client available on Windows, Linux, Mac, Android, and as a platform-independent ZIP package.
NXT Pricing, Market Cap and Trading Volume
Nxt was launched without an ICO. The total available supply is capped at 1 billion NXT coins. A large majority of the supply was distributed in giveaways, trades, and development bounties. As a result, 998.9 million coins are already in circulation.
The value of NXT has experienced several dips and spikes over the years. The most recent spike was likely caused by the IGNIS airdrop. All NXT holders received free IGNIS at a ratio of 0.5 IGNIS per 1 NXT during the last week of December 2017. NXT’s market cap shot up to an astonishing ~$1.7 billion USD on 25 December, 2017, and the value of one coin reached ~$1.7 USD.
NXT’s market cap has since stabilized and now hovers between $100 million and $200 million USD, but future airdrops could cause it to rise again. Jelurida released a blockchain creation kit on Nxt and 10% of all tokens created on new blockchains are automatically distributed to NXT holders, incentivizing the purchase of NXT.
Liquidity of Nxt
Nxt was an innovative and ambitious project when it was first launched and it remains ambitious today. Fortunately, it’s in the hands of an experienced team of developers now that Jelurida has the reins. The project is experiencing a revival because of the development of Ardor and the addition of a blockchain creation kit, and that has helped it maintain good market liquidity.