What is Namecoin (NMC)?
The Namecoin creators describe it as “an experimental open source technology that improves the decentralization, security, censorship resistance, privacy, and speed of certain components of the internet infrastructure such as DNS. and identity.”
DNS, the domain naming system, is the mechanism by which domain names are associated with digital IP addresses around the world. In this sense, namecoin is a cryptocurrency based on the bitcoin protocol that also aims to enhance security and privacy in relation to the internet.
Overview of Namecoin coin
The developers of Namecoin point to a number of potential uses and applications for this experimental cryptocurrency. The first item listed on the coin’s website is its ability to “defend free speech online by making the web more censorship-resistant”.
There are countless ways that Namecoin tries to do this. It can be used to attach identifying information such as email addresses, bitcoin addresses, or specified keys for various identities defined by the user. It can also be used as a means of providing decentralized TLS (HTTPS) certificate validation.
Namecoins can be used in Tor and the dark web to create a “Tor .onion domain that makes sense to everyone”. In the future, cryptocurrency and its underlying technology could also be used for file signatures, securing voting procedures, for notary services, and even for establishing proof of existence. for individuals and organisations.
How does Namecoin work?
Cryptocurrency is “a key/value pair registration and transfer system based on blockchain technology”. This means that namecoins can be used to securely write and transfer arbitrary names or keys. It can also attach data to these names.
Due to their links to the Namecoin network, these names are difficult to censor or capture, meaning they are resistant to outside influence. Additionally, the Namecoin creators specify that “lookups do not generate network traffic.” The result of this is that Namecoin offers improved security.
Namecoin was developed as a fork of bitcoin. Its developers have cited it as Bitcoin’s first hard fork and called it “one of the most innovative” altcoins to this day.
Namecoin paved the way for various cryptographic protocols and features including unified mining and decentralized DNS. It is also the first solution to the “Zooko Triangle, the longstanding problem of producing a simultaneous naming system that is secure, decentralized, and meaningful to humans.”
Similarities and Differences with Bitcoin
As a fork of bitcoin, Namecoin shares some similarities with the leading digital currency by market cap. It uses the same Proof-of-work algorithm that has long dominated bitcoin’s mining processes. It is also limited to a total of 21 million coins.
However, it differs from bitcoin in very important ways. First, Namecoin can store data in a blockchain transaction database. It is associated with the top-level .bit domain, a domain independent of ICANN, the main governing body that governs most domain names.
Namecoin can be traded in US dollars and for select other cryptocurrencies in various online digital currency exchanges. Transactions in Namecoin are currently irreversible. Records in the network are generated by address, encrypted with the public keys of Namecoin users. A record includes both key and data values, where the key is the path.
Namecoin has evolved from a discussion in the early days of bitcoin. It was introduced by a developer named “Vinced” on April 18, 2011. The merged mining feature allows bitcoin and namecoin to be mined simultaneously. Part of the reason for this feature is to incentivize miners to keep mining both cryptocurrencies at the same time, rather than toggling back and forth to do which is more profitable.
NameID, a service that associates profile information with identities on the namecoin blockchain, was tracked in June 2013. It was subsequently followed by numerous plugins for Firefox and other web browsers, which were designed designed to enhance the namecoin network and services.
As of March 2018, namecoins still do not gain traction when it comes to digital currencies ranked by market cap. The price of an NMC token peaked at around $12, but was still under $4 at the time. Currently only $0.75 left. Total market cap is $11 million, ranking 247th by market cap on Coinmarketcap.
Regardless of its financial success, however, Namecoin will be one of the earliest ventures into the altcoin space and one of the most pioneering altcoins released to date.
Namecoin retains many enthusiastic supporters, who believe that a decentralized DNS system could be crucial to internet privacy and censorship in the long run. While it is likely that most individuals will not need a .bit website or related service, namecoins can provide some tools to connect to the internet free from censorship and central control.
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