Lisk cryptocurrency: overview, features, advantages
Bitcoin was created as an alternative to fiat money, i.e. Its main function is to use it as a means of payment. With the launch of Ethereum, new blockchain opportunities have opened up. The developers introduced a platform on which you can run smart contracts and decentralized applications.
After the crazy popularity of Ethereum, many teams began to develop their platforms following the example of Ethereum. Most of them were a copy of the second cryptocurrency, however, some came up creatively and offered truly innovative solutions. One of these projects was Lisk.
In this article, we will examine in detail what this coin is and what its benefits are for the blockchain industry.
History of creation
The history of Lisk cryptocurrency began in 2014 with the development of the Crypti project. Lisk was created as a fork of the latter, however, it has some differences. Firstly, the Lisk code was open from the very beginning (it can be found on GitHub), while Crypti did not open its code. In addition, the developers decided to make some changes in the technical part, for example, the database was changed from SQLite to PostgreSQL, and the BIP39 standard is used to generate seed phrases.
The fork decision was made after the future founders of Lisk proposed the Crypti Foundation to modernize the cryptocurrency and make it more popular, in particular, to make the project code open, but the fund abandoned this idea. Then Max Kordek and Olivier Baddous decided to leave Crypti and create their own project.
The launch of Lisk was preceded by an ICO, which took place from February 22 to March 21, 2016. During the initial offer of tokens, a little more than 14 thousand BTC and more than 80 million XCR (Crypti tokens) were collected, which amounted to almost $ 6 million in equivalent. At that time, it was one of the most successful ICOs (after Ethereum).
A total of 100 million LSK coins were generated. Tokens were distributed as follows:
- 85% to ICO participants;
- 8% – to the creators of the project;
- 4% – for an advertising company and a bounty program;
- 2% to partners;
- 1% – to charitable organizations.
The launch of the Lisk decentralized platform took place on May 24, 2016.
The main Lisk team consists of more than 30 people – mostly developers, as well as several designers and marketers. The project is headquartered in Zug, Switzerland, but there are also offices in other countries: China, USA, Russia, Australia and Italy.
We should also talk about the founders. There is not much information on the Internet about them, but the results of the development of Lisk prove that they are professionals in their field:
- Max Kordek – President and CEO. He became interested in bitcoin in the early years of its development. Before launching Lisk, he was an active member of the crypto community.
- Olivier Baddows is vice president and technical director. He has many years of experience in programming, including the creation of products for distributed networks. One of his ideas when creating Lisk was to provide convenient and simple tools for developers.
Also worth mentioning is the famous project advisers:
- Charles Hoskinson – served as CEO of Ethereum in the past;
- Stephen Nerayef is a renowned venture capital specialist.
Lisk cryptocurrency technology
The main purpose is to provide a platform for creating decentralized applications. That is why the main requirement for the network is a high indicator of scalability.
The developers solved this problem by building a system based on sidechains. This is the feature that distinguishes Lisk from other crypto projects.
Sidechains are independent blockchains that are located outside the main network, but all transactions and other information recorded in sidechains are synchronized with the main network. This technology has very important advantages:
- Unlimited scalability of the network due to the fact that you can create countless sidechains, and they will not affect the size of the main network.
- Security of the main network – if bugs occur in one or several sadchains, they will not affect the operation of the main network.
- Flexibility – each project (dApp) is created in a separate sidechain, so developers have ample opportunity to configure applications.
Like Ethereum, Lisk cryptocurrency supports the deployment of smart contracts. However, they are not as fully functional as the first.
- Consensus algorithm – in the Lisk network, transactions and smart contracts are confirmed through the DPoS algorithm (delegated proof of stake);
- Sidechains – allow you to create autonomous blockchains that are connected to the main network;
In addition, the team offers developers various tools, the list of which is constantly expanding. The most popular are the following:
- Lisk Core is a tool for advanced users. Designed to perform several tasks: synchronizing the sidechain with the main blockchain, deploying a full API for developers, delegating shares during forging.
- Lisk Nano is a basic tool. Used to configure the basic functions: sending and receiving transactions, voting for forging candidates, registering a second seed phrase. When using Lisk Nano, there is no need to synchronize it with the “parent” blockchain, as it connects to the official Lisk nodes hosted by the Lisk Foundation.
- Lisky is a command line tool that allows you to interact with a remote or local Lisk host.
In addition, the team has created a directory of decentralized applications where developers can upload their products.
Instead of mining on the Lisk cryptocurrency network, transactions are confirmed through forging through the use of the Delegated Proof-of-Stake (DPoS) consensus algorithm. Only 101 selected nodes can participate in this process, i.e. Those candidates who received the most votes from netizens. For voting, each user earns a reward of 1 LSK. And in order to vote as a delegate, you need to go through a special registration, which costs 25 LSK.
DPoS in the Lisk network operates on the principle of rounds – every 17 minutes a new round begins. Each of the 101 nodes in each round is determined by one block. If one of the nodes cannot close its block, processing of this block is transferred to the next round. Blocks in the network are created at intervals of 10 seconds. Skipping each block results in a delay of 10 seconds when processing subsequent transactions.
When confirming the smart contracts through which developers launch dApp, a more complex system is used, since this raises a more complex task – it is necessary to protect the sidechains associated with the ‘parent’ blockchain. For this, additional “participants” are involved, such as delegates of the main network, and also verification is used via the Bitcoin and Ethereum blockchain.
Cryptocurrency Lisk: Advantages and Disadvantages
Lisk cryptocurrency has very important advantages, thanks to some of which it surpasses many other projects in terms of manufacturability and the number of applications:
- Unlimited scalability – the use of sidechain technology allows you to scale the network endlessly;
- Increased network security – due to the fact that sidechains are on top of the main network, it is impossible to disrupt the operation of the latter by creating bugs in the ‘subsidiary’ networks or violating the stability of their work;
- Responsible team – unlike many others, the creators really work on the development of the project and strictly follow the presented roadmap.
Regarding the cons, Lisk does not have them, at least at the moment.
Cryptocurrency Lisk and Ethereum
Lisk is often compared to Ethereum because Lisk was created as a fork of Crypti and was one of the first projects at the time of its creation, which were platforms for creating decentralized applications and deploying smart contracts, just like Ethereum. However, there are significant differences between these cryptocurrencies:
- Transaction confirmation: on the network occurs through the DPoS (Delegated Proof-of-Stake) consensus algorithm, in Ethereum – PoW (Proof-of-Work) (in the future, developers plan to switch to regular PoS);
- Location of dApps: in Lisk, decentralized applications are stored in sidechains, in Ethereum they are located on the main network;
- Error resolution: since Lisk dApps are created on the sidechain, in the event of a bug, it will exist only in this separate blockchain and will not have any effect on the “mother” network, in Ethereum, in case of an error, a hard fork is required to fix it. However, Ethereum uses EVM (Ethereum Virtual Machine) to prevent the penetration of bugs into the network.
- Smart contracts: smart contracts are not fully functional, unlike Ethereum smart contracts, which are Turing-complete (suitable for running any tasks on EVM).
The Lisk project offered a new look at creating blockchain applications, which attracted the attention of various companies, including leaders in the IT industry. At the moment, on the official blog of the project there is information about the following partners:
- ShapeShift is a well-known Swiss cryptocurrency platform that offers digital asset exchange services. As part of the collaboration, ShapeShift provided Lisk developers with some of its technologies, such as the Shifty Button and API calls;
- Chain of Things – Research Laboratory. Together, companies will explore the possibilities of using blockchain technologies in IoT (the Internet of Things), as well as develop new standards in this area;
- Transform.PR is a PR company that specializes specifically in the promotion of blockchain projects. Their specialists already have experience in promoting such well-known coins as Ethereum, Factom, MaidSafe and Dash. The purpose of cooperation is to increase the popularity of Lisk in the crypto community;
- Lightcurve GmbH is a blockchain consulting company. The company will become part of the Lisk Foundation and will assist in its management;
- SocketCluster is a company that offers a protocol to increase network scalability. As part of the collaboration, Lisk will abandon the HTTP protocol in favor of WebSocket from SocketCluster;
- Expand Online is one of the leading digital agencies that has worked with companies such as Microsoft, eBay, KLM, Adidas and Zalando. Expand Online is developing an effective marketing strategy to promote Lisk.
Lisk is a very popular cryptocurrency, so it was added by almost all reliable and proven platforms, such as Binance, Bittrex, Huobi, Poloniex, HitBTC. Buy LSK mainly for BTC, ETH, USDT, but, for example, EXMO also offers the LSK / USD trading pair.
Users have several options for storing LSK:
- Lisk Wallet is a wallet that is suitable for most users. Allows not only to store funds, but also to vote on nodes. You can download versions for all popular OS: Windows, Linux, macOS.
- Lisk Core is the most reliable wallet, however, it is only suitable for advanced users due to complex settings. It is also used to create a full node and participate in the transaction verification process (forging);
- Lisk Mobile – has limited functionality, but is suitable for users who only need to send / receive funds in LSK.
In addition, you can use hardware wallets from well-known brands such as Trezor or Ledger to store large amounts.
Lisk cryptocurrency is not a new project, and the team has already managed to prove the seriousness of its intentions. It is worth noting that it includes specialists who developed Ethereum.
Developers keep the promises presented in the Roadmap project. The main network was launched in the late summer of this year and at the moment it is functioning successfully. Despite the fact that MainNet “came to life” a little more than three months ago, a fairly large ICO has already been launched on Lisk. It’s about MADANA, a data analysis platform with a focus on privacy.