NEM is an important Blockchain movement, with its roots in Japan. As with any investment opportunity, it is important to consider many factors carefully before taking the plunge. This is particularly true of Cryptocurrency Altcoins, given all the hype in the market. Figuring out whether the hype has merit or whether the story is actually too risky isn’t always easy from news reports, which is why analysis and research are vital. Here’s a detailed report that should help you understand various aspects of NEM better, and hopefully help you decide whether to invest or to stay away for now. This is NOT a trading recommendation for quick returns, instead, it is an Investment Report for people who are willing to purchase and stay invested for the long run.
History
NEM (New Economic Movement) was the brainchild of UtopianFuture, the pseudonym of the individual or people behind the cryptocurrency, giving it a similar mysterious start like Bitcoin had with Satoshi Nakamoto. Not much else is known about UtopianFuture, apart from the organizational skills that helped him or her put together a team quickly, while also organizing thousands of online stakeholders to join the fray on development. But after some controversy around UtopianFuture controlling multiple BitcoinTalk accounts to attack other Altcoins, the online handle disappeared and hasn’t been seen since.
None of this seems to have bothered/fazed NEM developers. In fact, many characterized UtopianFuture's departure as planned. As with Bitcoin's creator Satoshi Nakamoto, UtopianFuture's sudden digital vanishing didn't cripple the movement. Too many people were already bought in.
Finally, there was also some controversy about Makoto Takemiya being one of the founding members/developers, but after a lot of debate, this was put to rest by the NEM foundation which laid out their Clarification here.
Two Important Features
While Bitcoin was based on the Proof of Work, Proof of importance is a critical aspect of NEM because it is how the system ensures all computers in the network form a consensus. It is designed so that every account on the NEM blockchain is assigned an importance score. This score influences how individual users can “harvest” the blockchain. One could say harvesting on the NEM blockchain is almost the same as what miners do on the Bitcoin blockchain. The objective is to add people’s transactions to the blockchain, in exchange for a small financial reward. As people’s importance score grows higher, they will have a better chance at getting these rewards.
In order to be eligible for the “importance calculation,” users need to have at least 10,000 XEM in their balance. Considering there are just under 9 billion XEM in circulation, achieving that goal is not overly expensive at this point. Once someone owns 10,000 XEM or more, there is a mathematical calculation taking place that computes the importance score. All of this is explained in detail in the following White Paper.
Technology & Design
While many investors don’t enjoy the technology part of the discussion, it is important to understand some parts before investing in something that is, at the core, based entirely on technology. We will keep this part of the report as lightweight as possible, and try to highlight only the significant parts.
NEM was originally designed as a fork of Nxt, similar to other Blockchains and cryptocurrencies. However, the creators eventually decided to create an entirely new codebase. Here are some important points to note about the NEM codebase, design, and architecture.
• Open Source and Closed Source: The NEM client is open source and available on GitHub. However, the NEM server-based component (the NIS) is closed source and has an obfuscated binary. This is done to prevent decompiles from determining how it works. The soon-to-be-released Catapult update, however (scheduled for 2017), will be open source.
• Namespaces: NEM has a domain naming system called Namespaces. The Namespaces system is similar to the internet’s centralized ICANN domain name system. Users can register higher level domains and subdomains, which allows one person with one domain to create many different subdomains for their different projects or outside business accounts. If you have enough XEM in your account, there’s no real limit to how many domains and subdomains you can create.
• Mosaics NEM has a unique system called mosaics, which allows for Smart Assets on the NEM blockchain (instead of the Smart Contracts in other Blockchains). Mosaics can be customized to be transferable or non-transferable, divisible or non-divisible, and have personalized descriptions. Mosaics can also be customized by the amount in either a fixed capped or mutable quantity.
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