Qtum is a blockchain network created in 2016 that combines the capabilities of Ethereum smart contracts with the Bitcoin UTXO accounting system. It achieves this thanks to a technology called Account Abstraction Layer, which gives Qtum the benefits of deploying updates from both Bitcoin and Ethereum. Qtum is decentralized, ie no transaction authorization is required. Anyone can operate the junction, all you need is a device and an Internet connection. Qtum uses the Mutualized Proof of Stake consensus mechanism to prevent unnecessary contract attacks. Prizes are distributed among many successful validators and are partially delayed by 500 blocks.
The article was originally written and published at Binance Academy
Qtum supports local token standards such as QRC-20, QRC-1155 and QRC-721. QTUM cryptocurrency is a local network token used for transaction fees, stacking (even offline) and management. You can buy QTUM in Binance with a credit or debit card or exchange it for another cryptocurrency. Qtum is headquartered in Singapore and has offices in Miami and Stockholm.
When it comes to blockchain technology, we are far ahead of Bitcoin. Most of the new Tier 1 platforms use innovations beyond the original Bitcoin model. Qtum took any elements from Ethereum and Bitcoin. This combination makes it a particularly interesting project due to its unique architecture. So, if you have ever been interested in what makes Qtum unique, the Academy is here to take you along with its unique aspects.
Qtum (pronounced Quantum) was founded in 2016 by Ashley Houston, Neil Mahl and Patrick Dai. The project was implemented by the ICO (Initial Coin Proposal) in 2017 and raised $ 15.6 million before the main network was launched in September of that year. The basic concept of the Qtum network is to integrate aspects of the Ethereum (ETH) and Bitcoin (BTC) networks. The team used Bitcoin’s Unspent Transaction Output (UTXO) model and combined it with Ethereum’s smart contract capabilities using both chains.
There are four important aspects of the Qtum network:
1. UTXO model for accounting.
2. Solidity smart contracts platform.
3. Account Abstraction Layer.
To create such a mix, it used a modified Bitcoin Core client program to increase the operating base of the Qtum network. The network is also compatible with Ethereum Virtual Machine (EVM) and uses Solidity as the encoding language.
This means that you can easily transfer your DeFi (Decentralized Financing) code and projects from Ethereum to Qtum. In addition, its special Proof of Stake (PoS) consensus engine is designed to deal with critical safety issues.
UTXO is an Unused Transaction Result and is a general concept in the world of cryptocurrencies. In some networks, cryptocurrency transactions consist of outputs and inputs. For example, to send 1 BTC, you need to use UTXO as an input, and then “send” as an output. These UTXOs are then recorded as consumed and the output becomes the new UTXO.
Imagine you are sending 0.6 BTC. The deal will consist of 0.4 BTC and 0.2 BTC from previous trades. However, if you only want to send 0.3 BTC, you need to divide 0.4 BTC UTXO by 0.3 for your friend and 0.1 for yourself. It emits two new UTXOs, fully spent 0.4 BTC and 0.3 and 0.1.
This accounting system may seem strange, but it has its advantages:
1. It’s easy to deal with double spending because you can see if the product is already wasted.
2. Network operations can be processed in parallel, because each operation has independent outputs.
Ethereum, on the other hand, uses an account transaction model similar to that found for a bank account. This special model maintains the global status of all network balances.
Smart contract blockchains usually do not use the UTXO accounting system for technical reasons. Qtum’s answer is to use the Account Abstraction Layer (AAL). As the name suggests, the Ethereum account system has been separated from the technical application.
In the smart account model, contracts work with the address of the smart contract or expiration balance. However, in the case of UTXO, a smart contract must decide which UTXO to use, often at several public and private addresses. Internal transactions between contracts pose a similar problem. The UTXO blockchain must record all transactions, which complicates the process.
AAL uses the output of the UTXO operation to create a smart contract. It then sends a transaction to the contract account to start executing the contract. AAL processes the results and adapts them to UTXO.
AAL technology allows Qtum to take advantage of both Ethereum and Bitcoin updates. For example, when support for non-exchangeable tokens was added to Ethereum, Qtum was able to accept it quickly. Notable updates for Bitcoin were Segregated Witness (SegWit) and Taproot. UTXO-based support also allows Qtum to use Lightning Network and other technologies.
Mutual Proof of Stake is a special Qtum consensus engine. The Qtum team designed it by increasing their costs to combat contract spam attacks. The mechanism distributes block premiums among block-producing nodes and also delays payment. Each award is divided equally between the winner confirmer and the previous nine successful validators. Some prizes are also delayed by 500 blocks. This system makes it difficult for attackers to accurately calculate the reward from a potential attack.
In August 2020, Qtum introduced a new offline stack mechanism for QTUM owners. Instead of refusing to take care of QTUM tokens, it is enough to enter the address of the wallet. Your coins remain in your wallet and can be spent or withdrawn at any time. There are two actors in the consensus mechanism: Super Stackers (validators) and representatives.
Delegates send the address of the wallet to Super Staker through a smart contract. A fee will be set by the delegation and the Super Staker may decide to accept the delegation. Super Staker can then assemble the UTXO of the poster. If the Super Staker block is successfully approved, it will share the award with its representatives and receive a fee.
Once authorized by Super Staker, you earn QTUM passively. You don’t need to be tied to a smart contract, and you can work with an offline solution like a hardware wallet.
Super Stackers can then win representative block prizes and pay a sting fee. However, there is no need to keep the representative’s wallet connected to the network after the delegation. In other words, the delegates receive their awards passively.
QTUM is a local Qtum cryptocurrency distributed to users through a network consensus mechanism. You can use QTUM coin for the following:
2. Participate in the Qtum on-chain management protocol by voting on proposals. These may include changing the block size or network charges. The gas price can be lowered and the block size can be increased to support Tier 1 operations up to 1100 TPS during periods of heavy use. If necessary, a Layer 2 solution such as a Lightning Network can be used to increase this throughput.
3. Dial as Blocks Delegator or Super Staker to confirm. Each new block presents rewards for Representatives and Super Stackers. Qtum periodically halves the premium using a method similar to Bitcoin hacking. This mechanism will eventually produce limited QTUM reserves that will take decades to reach. At this point, collectors will be rewarded only with operating fees.
Binance offers two ways to get QTUM. First, you can buy them with a credit or debit card for selected fiat currencies. access the page [Kup Krypto Za Pomocą Karty Debetowej/Kredytowej], select the currency you want to pay, and then select QTUM in the lower field. Click here [Kontynuuj]to confirm your purchase details and follow the additional instructions.
You can also trade selected cryptocurrencies, including BUSD, BTC and ETH, against QTUM. Go to the Binance Stock Exchange view and enter QTUM in the search box of trading pairs. This will show all available trading pairs. For more information on how to use the Trading View, see How to Use TradingView on the Binance Site.
Qtum blockchain as a solution is very unique. Solves problems seen in Proof of Work (PoW) by applying a PoS system with updates. Allows smart contracts and Decentralized Applications (DApps) when using UTXO accounting. Although many blockchain platforms in the ecosystem have developed completely new approaches, Qtum has taken on more successful functionality than its predecessors. So, if you consider Qtum to be an altcoin, you can now make a more informed decision based on its use.
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