Token Sales & Proof of Stake

Ledgerium will be selling XLG as part of an open token sale to power the entire eco-system. In the section below you will find the break-down of how we plan to conduct the sales and bring on board decentralized entities that are core to any consensus based blockchain.

The ledgerium blockchain is currently running in a testnet and all development has been completed in our core protocol features. We are now working on bringing on board the required block producers. These block producers when all on-boarded will allow us to launch into main-net. Since the protocol requires block producers to be independent and acquire token to stake into a master node, the mainnet will launch once all block producers (at least 21) are in place.

As part of the services and consensus, the ledgerium chain requires that at most only 33% of nodes be faulty or working against the consensus mechanism. This requires all actors in the blockchain (block producers) to be sufficiently penalized for any disruption in service. This is achieved by ensuring each block producer has a sufficient stake in XLG locked per node. The stake will be set to 3 million, however if they nodes together feel this needs to be changed, then a code consensus level change can be achieved if all service providers agree on this change.

Ledgerium works a bit differently to the traditional proof of work systems.

Proof of work:

Any actor can start mining using specialised mining hardware to start producing blocks and claim the block rewards. There is not set way of ensuring no single entity owns more than 51%, except the cost of mining. Under certain conditions it is possible to acquire more than 51% hash rate on these chains as we have already seen for some of the smaller blockchains. This is currently not possible in Bitcoin or Litecoin due to massive participation, but proof of work by design is cannabilistic and most compute power will always be behind the strongest chain in terms of value of the block rewards.

Cons

Strongest chain will always have the most compute power (bitcoin).

51% chain take over attacks very easy on smaller chains.

Consensus decisions can be hi-jacked by those who hold the most compute power.

Proof of Stake:

Any actor can stake a certain amount of coins and the ability to produce blocks and get the block rewards is purely based on the amount of coins you have locked away. The rewards are paid on a basis of weight (your coins locked away) and how long you have had those coins locked for staking. While the coins are locked for staking, they cannot be used for any other activities on the blockchain.

Cons

Centralized entities can control the entire network if they control large quantities of the native coin.

51% chain take over attacks very easy on smaller chains.

The native coin is locked and cannot be used for the activities essential for a blockchain and

Masternodes & Consortium Chains + pBFT:

Ledgerium uses a consortium based consensus. This means that the actors that will be producing blocks will be chosen on the basis of:

  1. Locking a fixed amount of coins (3 million).

  2. Approved by other members to be a value add addition to the entire ecosystem, e.g. competing enterprises can both be a block producer.

  3. Eliminating speculative block production because each actor is added to the network based on merit.

  4. Ensuring 60% of the block production is always done by known reputable non profits or ledgerium foundation.

  5. Enterprise and Non-Profits work together with equal weight in the ecosystem to produce blocks. These are dispersed geographically and vertically.

  6. Discourages speculative owning of nodes because the block production is done purely to ensure the chain is healthy and no large amounts of coins are locked for economic only reasons.

Blockchain as a service:

As discussed with the consensus mechanism in place, ledgerium allows blockchain to be offered as a service by both ledgerium, and each individual block producer. The use of token is to ensure services built by each of those block producers can run and compete for resources in the entire ecosystem. As part of our launch, we will be launching various applications that show-case this power including a block chain proofs service, and microservices for other web-based data aggregation via open APIs (Banking & Finance).