Bringing Cryptocurrencies to Life: TAU (True Asset Unit)

By Niklas Spille-Scheich | Cryptonic | 17 Mar 2019

$4.20 tipped


We know that Cryptocurrencies are here to change the world. We don't know, however, what this change is going to look like - many theories are floating around on how the gamechanger in Cryptopia should look like. Things that were supposed to overcome limitations of one platform may well turn out to be flawed in a different way - among the projects coming up with new ideas is the TAU Coin, postulating serious flaws in all major Cryptocurrencies and trying to work their way around them.

Consensus Mechanisms

Theory 1: Current reward mechanisms don't incentivize what the projects aim for.

(1) Proof-of-Work (PoW): was a good idea before the advent of ASICs, with everyone being able to participate in the work progress. Working its way through time, it turned out that Proof-of-Work currencies are not as decentralized as expected (word on the street is that some miners race to create empty blocks as the block reward is awarded regardless of the amount of transactions processed). And it's taking up a lot of energy - even if it's renewable energy, it's a waste. Sorry - with imminent danger of changing this planet's surface to quite a challenge for our species, this is not acceptable. Maybe okay for kickstarting the entire cryptocurrency ecosystem but now it's time to move on.

(2) Proof-of-Stake (PoS): is an answer to PoW's energy question, stop letting users race to find the secret ingredient to make a hash match a target but let them have a stake instead and decide by stake size who's got a chance to be the next block generator and have other nodes be elected validators. Sanctioning bad behavior may be incentive enough to make both generators and validators behave properly.

Both mechanisms undermine what Bitcoin marketing has declared: Be your own bank, free of third-party control. Both mechanisms lead to accumulation of Hardware (PoW) and Money (PoS) in the hands of a few groups.

(3) Proof-of-Transaction: is TAU's answer to this issue. In order to have a coin be used in everyday transactions, everyday transactions need to be incentivized. Similar to PoS, TAU block generators are chosen by the amount of transactions done. Thus, the way to earn block rewards is using the coin for transactions. This might lead to a malevolent actor initiating lots of fake transactions, the TAU team is working on ways of disincentivizing this behavior, though. PoT may end up being the fairest consensus mechanism available as everyone will be able to initiate transactions; it may be friendly to the environment as well. To protect the TAU blockchain from 51% attacks, the transactions to be considered for block generation privileges shall have been processed within the last year and each transaction is given an upper boundary for mining privilege gained.

Centralization and Decentralization

Theory 2: It is impossible for one node to collect all transactions in a world-wide competitive decentralized network.

Following this theory, Bitcoin will never be able to become an everyday commodity. Bitcoin Lightning has its own issues, Ethereum's Layer 1 Sharding introduces its own risks, Layer 2 solutions did consider Lightning's liquidity network as early as a year ago. All of these solutions have one thing in common: Transactions are handled without everyone knowing about them instantaneously yet they are cryptographically secured. TAUCoin expects "mining clubs" to form by either physical locations or proximity in terms of processed transactions and addresses involved.

At the same time, TAUCoin aims to provide a blockchain mechanism that is light enough to have the entire blockchain maintained on mobile devices - both in terms of storage and in terms of block processing. Any current Android-enabled phone (any Android-replacement!) will be able to be integrated into the TAU Consensus Network; giving the power of maintaining the public ledger back to the public. By allowing every miner to adjust their block size and block generation time, even low-powered mobile devices may join the club.

Decentralizing TAU's communication protocols may take a while as the dev team did not find any real server-less code to build upon. As of yesterday, the TAU teams is going to work around this by creating a public "kickstarting node" providing to new nodes ledger info, transaction pool, receive transaction into pool and receive new blocks in order to get the TAU Mainnet started. As this comes up and running, the team will develop really decentralized protocols for each of these functions, eventually replacing the "kickstarter node".

Transaction Processing Speed

Bitcoin is estimated to process 3.5 to 7 transactions per second. Ethereum's Proof-of-Work mechanism supports about 15 transactions per second and may well grow to mid-sized thousands of transactions per second using Sharding or Payment Hubs. The VISA network is advertised as being capable of handling 24,000 transactions per second. PayPal is estimated to handle about 193 transactions per second. Somewhere in between lies the number of transactions a cryptocurrency needs to be able to process if it's supposed to be used on a global scale. TAUCoin aims to be able to process about 115,000 transactions per second - given the metrics of PayPal and VISA this may well overachieve the goal but will definitely be enough to achieve adequate transaction times in the future.

Conclusion

As of today, TAUCoin is in early beta state but does provide some fresh ideas which may turn out to be very interesting. The only way of acquiring TAUCoins at this moment in time is by using the Testnet Airdrop, with Testnet balances being transferred to Mainnet when it comes online. With 225,000 registered wallets as of today, the TAU team will not consider putting any effort in getting listed on any of the major exchanges before the userbase has not grown to one million users. Every new users will be given 100 TAU as a starting bonus, more can be acquired by trading on a peer-to-peer base, bounty-hunting TAUwork tasks or joining the official Discord server to participate in coinrains. Looking at the project's roadmap, we can expect some serious milestones to be hit in 2019 :)


Niklas Spille-Scheich
Niklas Spille-Scheich

Mined some Bitcoin for fun in 2011 and hit format c: before giving that laptop away. Got triple copies of my seed words placed all over the world. Unite 3 of my closest friends to recover access to my crypto assets.


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