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Rocket ride from the underground

By Daniel M. Ryan
web posted July 18, 2016

One pleasing part of the cryptocurrency frontier is bumping into folks that don't fit into the slots we're used to. Some are irascible, true, and some are outright obnoxious. But some have hearts of gold. Case in point: the tireless woman behind a minor altcoin called Qibuck Coin.  She is not irascible; she's irrepressible. Posting under the nick qiwoman, she's all over the Alternative Cryptocurrencies landscape and a frequent if recurrent chatter in Poloniex's trollbox. That haunt is irrepressible in its own way, filled with the usual jabber about what coin's going to the moon. Recently, the trollbox "Mod Squad" has been imposing temporary bans more frequently, ofttimes for one of the guys urging the others to buy this-or-that altcoin. Their "Banhammer" is part of the fun, and I suspect that at least one trollboxer has deliberately broken the rules so as to brag about being banned. "ABCDE is going to DA MOON! Banhammer, TAKE ME NOW!!!"

qiwoman ‘s way of running qibucks would get her dinged for issuing a thinly-disguised security, in a lot of jurisdictions. She pre-sold some Qibucks back in 2014 and promised to use the income from her and her gang's money-gathering activities to buy Qibucks off Poloniex and destroy them. These activities are all small scale, and many of them have sprightly names like the "Clickers' Club." The ledger books are not filled out in a regulatory-approved manner. But an honest accounting would show that she's thrown money into the Qibuck operation, net. In other words, she's working for less than free. All the while, staying cheerful and chatty.

She's a perfect example of someone running an operation that's in technical violation of the law but who any regulator would hate to prosecute. She's one of those folks with a real heart of gold.

Unsurprisingly, she has a fan base whose loyalty is all-but fanatical. She and her inner circle keep Qibucks going with enthusiasm and verve, and the few altcoineers who have criticized her look like heels. Technically, there's nothing special about Qibucks: it's a standard Proof-of-Stake coin much like one you could buy off a coin cloner for a few or several hundred bucks. It's lasted as long as it has for one reason: community loyalty. That's what you need – a loyal community – to keep even a minor altcoin going. Being active as a dev is necessary, but not sufficient.

Qibucks stands out because it doesn't fit the usual rule of community building in the altcoin space. Normally, the alts with the most loyal communities have a dev or dev team that promise innovations and deliver some. These skills give community members the feeling that they're helping build the cryptocurrency future, or at least are part of it. Another altcoin, also listed on Poloniex, exemplifies this community strength and solidarity. It's named Qora, and it's another old-timer. It's gone through three different announcement threads and two dev teams. Its original dev made it hot in its day because he coded Qora from scratch instead of cloning it from another. He's interesting in a different way, because he very much preferred to quietly code rather than manage the community with frequent updates and rally-hos. His shyness got to the point, when the altcoin bear market was gnawing away, where a few folks were complaining about his shyness. But his reticence created a vacuum that was filled by others, including other techies who pitched in. As a result, Qora is one of the few cryptocurrencies equipped with blockchain-to-blockchain Automated Transactions and is the only one with the capability of hosting a truly decentralized circle of Websites. Although this latter functionality is only rudimentary, and can only host Websites that look like they came out of the mid-1990s, it does work and is a first of its kind: a genuinely decentralized mini-Internet. Since all its Websites are secured by the Qora blockchain, it's censorship-resistant in a way that the ordinary Internet cannot be.

These two alts were both part of the supernova of new altcoins that marked the end of the 2013-14 bull market. The one you're about to meet was intended to be a response.

From Consolidator To Visionary

On June 19th, 2014, a Bitcointalk user nicknamed KryptoKash announced a new cryptocurrency named CoinShield. Its purpose illustrates how an industry ebbs and flows with booms and busts. When boom times roll, especially at the end, the flush times for the enduring players is accompanied by proliferation. More and more new firms pop up, many of which are started by employees of established firms striking out on their own. A good example is shale-drilling. High oil prices, plus free-flowing capital from more and more capital suppliers convinced that triple-digit oil was here to stay, led to an explosion of drilling firms – many small-scale – headed up by folks who resolved to make the most of the bonanza.

But as boom turned to bust, and the boom-time legend of "Peak Oil" was busted by technological advance, the bitter cure for high prices did its work with a vengeance hardly seen. Instead of triple-digit oil, the industry has been battered into expecting $50 oil. The formerly prolific landscape of firms has been battered in consequence: battered and culled. Remember the headline-grabbing bankruptcy of the fracking subsidiary of Chesapeake Oil?  The bankruptcy watch for Chesapeake itself? You can add up quite a sum of sub-headline bankruptcies in the field: mostly small firms that depended on "Peak Oil" to continue. Right now, the players with enough cash reserves to get through the bust are looking at the bankruptcy filings to see what properties and assets they can pick up at a bankruptcy discount.

This sombre cannibalization process shows that the bust period is accompanied by consolidation.

CoinShield was unusual in that it was a project deliberately designed to be a consolidator. The original distribution plan allocated some CoinShield coins towards a consolidation fund. In exchange for altcoins that the community generally recognized as "----coins," holders of them would get some CoinShield. The goal at the time was to get rid of them, to pare back the proliferation to something less bubble-nutty, while offering the bagholders of those coins a second chance.

Started in the later part of the altcoin bubble, it was unusual in that it flatly bucked the trend. It was also unusual in that it was pre-announced at a very early stage of the project. Interested folks were warned at the outset that CoinShield would take a long time to develop.

Along the way, its original purpose was dropped – in part because the original project had no satisfactory guard against the consolidation plan being gamed. That realization prompted the CoinShield team to rebrand it as something bigger and better. And CoinShield became Nexus, a coin designed for "connecting the world" and making it better -  under the guidance of the fellow who was second to post on its thread back in the CoinShild days, Videlicet.

This fellow's an intriguing combination of all-bolts-checked engineer and visionary. As I write, the coin boasts eleven features which show this bolt-by-bolt thoroughness. Most of them deal with better security and more reliable consensus-finding. Some of them make up a multi-tier securing system that encompasses two proof-of-work tiers and a proof-of-stake system: the goal here is to thwart a simple 51% attack. The proof-of-stake part features "trust keys" which incentivize stakeholders to actively help the network by keeping their nodes up and running. Although the "Current Features" part of the announcement post is well-written enough to explain the benefits, it still reads like the fine print of an eBay computer listing. You have to be something of a techie to understand what it really offers.

You can see and hear this bolt-by-bolt vision by watching a video recording of an edited Hangout featuring Videlicet. To be honest, it's difficult to understand unless you've prepped for it by reading both the announcement post and watching this introductory video. Once you're through these, have a listen to the Hangout recording.You'll see both sides of him: the visionary who sees Nexus as providing technology that will change the world, and the detail-oriented engineer who's one of the few folks to have picked through the entire source code of Bitcoin, tested it out and found parts of it wanting.

You'll also see something else. Videlicet, whose real name is Colin Cantrell, is the son of an aerospace engineer who's started his own company after working for Elon Musk's SpaceX. Thanks to his old man, Nexus got a mention on BBC News at the end of last month. Father's and son's minds have met with a vision of sending up a full node in a satellite to help maintain the blockchain from outer space. It's a first step to the goal of many satellites, which would provide globe-spanning synchronization services for all those folks in the Third World who can't access cryptocurrency with the services we're used to. As is his wont, Cantrell fils laces his vision with a technical overview of a light client that could interact more efficiently with the full nodes than other cryptocurrencies'.

No wonder that the Nexus community, now overseen by a team of six, has been so durably loyal.


As this chart shows, they've needed to be. Until recently, Nexus has been one of those classic sleepers. Even though it's had a steady flow of improvements, it's had a hard time getting above 1000 satoshis. Holding on, especially through the usual excitements of the cryptocurrency frontier, isn't easy to do.

It takes resolve, the resolve to sit through a long wait of flatlining while ignoring the excitement elsewhere. This resolve is difficult to sustain unless the cryptocurrency has a vibrant, upbeat and durable community; ideally, one whose members are visionaries themselves. If an altcoin has it, there will be lots of reinforcement from loyalists who keep up the faith and indicate that they're seeing the alt's doldrums as yet another buying opportunity.

It's a tricky game, in which you have to be choosy; in a very real way, a person who makes a big score is nothing more than a successful bagholder. The market gods are that fickle sometimes.

If altcoin speculation ever grows enough to sustain investment-advisory services, the standard maxim will surely become: "There are three things that matter in altcoins: community, community and community." ESR

Daniel M. Ryan, as Nxtblg, is shepherding the independently-run Open Audi Initiative Prediction Market Shadowing Project. He has stubbornly assumed all the responsibility and blame for the workings and outcome of the project.




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