We’ve heard a lot about Syscoin ecosystem lately. Indeed, this dark period of bear market allows time for builders to focus hard on the tech and for investors to dig deep into what will be the trends of the next bull run. In this article we will have a general overlook on the Syscoin ecosystem and why its technology is so particular.
1. What Is Syscoin?
Syscoin was created in 2014 by Sebastian Schepis (developer and project management consultant) throught a Bitcoin fork and is now guided by the Syscoin Fondation since 2019.
They are providing an infrastructure for the developement of Web 3.0 Dapps, expanding the uses cases and the possibilities for businesses to boost their decentralized services such as marketplaces, digital certificates, payments and escrow transactions.
The 2 main particularities of this POW (Proof-Of-Work) chain is the merged-mining and the dual-layered blockchain: Combining the security of Bitcoin and the Smart-Contracts functionalities of Ethereum.
So, Syscoin aims to be the most scalable, secured and decentralized chain with fast and cheap transactions. Does that mean they resolved the blockchain trilemma? I investigate.
2. How Does Syscoin Work?
Syscoin is a dual-layered blockchain: the core of the Syscoin chain (L1) based on merged-mining Bitcoin providing security that is running in tandem with an NEVM (L2-Network-Enhanced Virtual Machine) based on EVM (Ethereum Virtual Machine) providing the smart contracts functions.
The merge-mining advantages: Miners are receiving rewards for validating blocks on Bitcoin and on the Syscoin chains. They are securing both chains with the massive amount of hashpower Bitcoin benefits while earning extra SYS rewards at no additional cost and without tampering their hashrate.
Hence, Syscoin is receiveing the security model, and UTXO efficiency from Bitcoin. In order to be protected from 51% attacks -wich in our opinion is an off the table problem- Syscoin also implemented the Chainlock protocol, enabling masternodes quorums that need to agree several times on the validity of the next block.
About NEVM : The Network-Enhanced-Virtual-Machine is providing smart-contracts functionalities and interoperability while being designed to have a huge potential to scale. The foundation is aiming to be able to implement Turing-complete smart-contracts (to be able to read and write any known problem ) through zkRollups offering extra scalability and absolute trustless interoperability.
Also, the tokens on Syscoin are SPTs (Syscoin Platform Tokens). Instead of residing on the NEVM chain (wich supports ERC-20 tokens), the SPTs are UTXO-based tokens: the transactions operates just like Bitcoin rather than ERC-20 account-based system.
In short, you just need to know that UTXO (Unspent Transaction Output) based systems (Bitcoin, Syscoin, Litecoin, Zcash…) are recording individual transactions grouped in blocks where account based systems (Ethereum,Tron, EOS…) are recording coins as a balance within each account, either controlled by a private key or a smart contract.
While being a place where any Ethereum smart contract can be deployed, the NEVM L2 powered by zkRollups is highly scalable. The foundation is aiming for 210K TPS (Transaction Per Seconds). I will guide you through how they will achieve such a great transaction rate while maintaining a fast delivery and low cost.
3. What are the challenges ahead ?
While the NEVM is nowup and running the Syscoin ecosystem still has great challenges ahead. With the work already done by the team, I belive that theses objectives are achievable.
Rollups, Scalability and security : Based on zkSync Rollups, the zkEVM has already successfully been deployed to public testnet in February 2022. Matter Labs, which are in charge of deploying the Rollups, said recently that “achieving the zkSync 2.0 mainnet by the end of 2022 is a very conservative estimation”. We can then expect that feature very soon. I have also read that they are working on integrating Optimistics Rollups to the chain and that this would happen very shortly as well.
Validium – Proof of Data Availability (PODA), boosting transaction output : Through a different Rollup, Validium will secure the off-chain storage to the L1 security. Indeed, this is an important improvement as “classic” Rollups store their data on-chain slowering transactions. With Validium the Syscoin ecosystem is said to reach the overwhelming number of 4,000,000 Transaction per Seconds! I must admit that this number is very impressive and I am really looking forward to Q3 2022 for this technology to go live and investigate in details.
DAOsys, decentralized treasury managment : Funding new projects with a risk-mitigating mechanism. The ASE (Autonomous Service Engine) is applying AMM models to DAO (yes, I was disturbed as well at first). Users deposit assets in a staking pool and receive Treasury Tokens wich are then staked as well. Builders and investors then discuss a roundtable and establish quests to compartmentalize the risks and assets which investors can invest in.
4. What are the latest Syscoin Partnerships ?
2022 has been a very busy year for the Syscoin ecosystem with some amazing achievements. In december 2021 the NEVM went live on the mainnet and some great partnerships were announced :
- Bloktopia : A virtual reality space in a skyscrapper (yes, a metaverse). Dedicated to education, this place will also be somewhere you can interact with an economy, NFTs, and earn revenues.
- Uno Re : An Reinsurance protocol. Retail investor will also be able to trade and invest in insurance risk portfolios.
- Bounce Finance : A DeFi Platform, token trades and NFTs auctions. They are planning to build a DAO toolbox and liquidity mining.
- Ankr : RPC (Remote Procedure Call) provider will relay informations between nodes, apps, and users. Syscoin will also integrate AnkrScan, a multi chain explorer.
- Tribe One : DeFi and NFTs combined with lending and borrowing.
- Mud AI : a metaverse, yes, again. Users will be able to build and customize their avatars as NFTs. They will also be able to aquire lands, build and sell properties, create DAO housings or NFTs galleries.
Also, Syscoin was as well listed on KuCoin and Ape Swap. This first DEX listing is enabling user to trade their WSYS (Wrapped Syscoin) for basically any token existing on any chain through the Ape Swap Router.
5. How to store Syscoin ?
Here is the list of Syscoin supported Wallets and Exchanges (CEX+DEX). I strongly advise you to keep your coins on a hardware wallet like Trezor or Ledger to keep your funds safe.
- Klever Swaps
- Ape Swap
- Pali Wallet
- AGX pay
- Go Pocket
6. What To Do With Syscoin?
While being a fairly old ecosystem, Syscoin’s innovations and Dapps came mostly in the recents years. Here you will find anything you can do with $SYS. From NFTs to DeFi and Games there is a lot to discover in my opinion !
7. $SYS as an Investment
First of all I cannot give you financial advice here, but let’s discover the pros and cons of investing in $SYS. Remember to DYOR (Do Your Own Research) or you will get rekt !
Unfortunately, the funding round in 2014 has not be so successfull for $SYS as the escrow agency Moolah wich was in charge of the ICO (Initial Coin Offering) stole 750 of the 1500 BTC raised (~450$ per BTC back then). Fun fact, I found out that the court case of Moolah’s agents is the first one to admit blockchain data as evidence.
As $SYS is merge-mined with Bitcoin, the last $SYS will be mined in 2068 for a total supply of 888 million. At the time I am writting this article there is about 658 millions of $SYS circulating (~75% of total supply) and its price is around 0.14$US. $SYS is ranking around #272 by marketcap.
As most altcoin, Syscoin price is ratherly driven by the bitcoin price but we can observe that it has been explosive during the last bull run.
Socially, they have 166k followers on Twitter, 7.5k on Reddit and 14k adresses.
Finally, I think the team need to continue building and delivering to survive this bearmarket but being live and running since 2014 is already a good mark of resilience.
I think the solution Syscoin offers to the blockchain trilema is pretty creative. Indeed, this is one of my favorite along with Polkadot (find more here). If you are looking for a small cap-technological gem and belive the team will achieve its roadmap feel free to talk about it with us on Twitter (@OracleAltcoin).
Thanks for reading.
n.b: this is not financial advice