Tech 10 April 2018

Dan Taylor

Skycoin proposes blockchain solution, but does it understand the problem?

The difficulties with SegWit and scalability have been well documented, with the resulting transactional congestion now almost universally accepted as a problem that must be overcome. The latest protocol claiming to offer the solution comes in the form of Skycoin’s much-publicised Fiber platform. But do the claims actually stack up?

Their protocol claims to solve several issues with SegWit as it currently stands—namely scalability, and the centralization effect that comes from concentrated mining pools. Yet some are far from convinced that Skycoin holds the answer to these problems.

The blockchain works by enabling each token to serve as its own validated fork, which can then be customised to meet the needs of specific dApps. Their consensus protocol, known as ‘Obelisk,’ claims to reduce the costs and processing times for transactions on the protocol.

Despite the hype around this “sounds-too-good-to-be-true” coin, there remain serious concerns over its design and deployment. Some analysts are even less polite. TheNextWeb‘s Tristan Greene said Skycoin was ‘probably’ to ‘even more probably’ a scam.

“Skycoin, the sounds-too-good-to-be-true coin with so many problems its likelihood of being a scam is somewhere between ‘probably’ and ‘even more probably.’ On the one-hand, it meets all the requirements for a legit cryptocurrency. It’s got a nice website, a white paper that passes a novice glance, and a positive community presence (perhaps a little too positive, which is explained by this bounty program). Plus it’s been around since 2012 making it old AF in the crypto world,” Greene wrote. “But why does Altcoins.com list it as a scamcoin due to pre-mining? And, as blogger Ilya pointed out, its whitepapers don’t make sense.”

Greene’s comments are far from isolated, with commentators throughout the blockchain community raising serious questions over the project.

Aside from the pre-mining issue, and concerns over the so-called ‘mining’ hardware, which has caused confusion, given that Skycoin is already pre-mined, a number of other issues have been flagged throughout their white paper and documentation, suggesting either a lack of understanding, or a deliberate attempt to confuse.

For those still considering getting involved in Skycoin, there are too many unanswered questions around the protocol, and little sign that the Skycoin team actually understand the problems, let alone the possible solutions.

The issues they raise are already resolved in large part by Bitcoin Cash (BCH), the true model of Satoshi’s original vision for Bitcoin, and the only blockchain capable of reaching scale—no dodgy ‘mining’ equipment required.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.

Bitcoin Satoshi Vision (BSV) is today the only Bitcoin project that follows the original Satoshi Nakamoto whitepaper, and that follows the original Satoshi protocol and design. BSV is the only public blockchain that maintains the original vision for Bitcoin and will massively scale to become the world’s new money and enterprise blockchain.

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