A lot of tokens have taken inspiration from Bitcoin. Some of them have been more or less direct copies, barely changing things about the protocol and simply putting the network under a different name. These tokens are not going anywhere. One of the reasons Bitcoin is strong is because it has survived time and again over the years to become the strongest chain around. Kind of like a survival of the fittest.
Others have been a little more original, even after taking inspiration. These projects take the best parts of the Bitcoin protocol while changing other parts that best suit their purpose. Whether it’s a technical aspect like the consensus algorithm or tailoring the use of the network for a particular application, these networks are trying to find the most suitable way to go forward.
The blockchain industry is still very young, so there is time yet for projects to try new things, test their ideas, and refine them for large-scale commercial use.
One of these projects that have been inspired by Bitcoin but is using the network more originally is Ravencoin (RVN), which takes much from Bitcoin, but has customized it enough to use the ideas uniquely for the purpose of tokenization.
For those of you that don’t know, tokenization is rapidly growing niche in the market that has enormous potential. Indeed, it has seen so much coverage and attracted so much investment that it could very well be one of the major areas of the early 2020s. Being a part of the decentralized finance (DeFi) space, it is almost certainly set for growth, as DeFi has provably become a hotbed for investment in the past 24 months.
What is RavenCoin (RVN)?
The Ravencoin (RVN) project launched in January 2018 and has a strong community. It did not conduct an ICO or pre-mine any of its coins, true to its nature of being democratic and community-driven.
The project’s name gets its inspiration from the fantasy series Game of Thrones, as Ravens in the fictional word were “messengers who carry statements of truth.” The project’s own description of the project is described as follows,
Ravencoin is a digital peer to peer network that aims to implement a use case specific blockchain, designed to efficiently handle one specific function: the transfer of assets from one party to another.
Although it does have instant payments in mind, the network is intended more for asset creation and transfer - not just the transfer of funds.
Ravencoin is a fork of the Bitcoin (BTC) protocol, and features a few important changes, which I have described below. It allows for tokens to be issued on the network - the project says a security token can be launched “within minutes.” The tokens can be given a unique name and quantity, and can be made to be a security or collectible.
Ravencoin development is done by the community and is open-source. The project’s core developers are Bruce Fenton and Tron Black, the latter being the project’s lead developer. Ravencoin’s whitepaper was written by Fenton and Black.
Additionally, the team has created space for future changes. Tentative ideas include messaging, a voting system and a rewards program. The Ravencoin roadmap describes all of the potential features.
So now we know what Ravencoin is trying to do. But what can be tokenized with it?
What is Ravencoin Being Used to Tokenize?
A list of supported Ravencoin assets. Source.
Here’s the most exciting part of Ravencoin: it can be used to tokenize all sorts of assets and has been used to tokenize several already.
The list of potential assets are as follows: securities; virtual goods such as event tickets, in-game currencies and service access; precious metals like gold and silver; land deeds and energy units like oil, gas and electricity; and credit, like gift cards, airline miles and reward points.
You can see how useful this would be for the end user. Do you want to buy some land? You don’t have to shell out an exorbitant sum. Simply a fractional amount using RVN and you’ve got your real estate! Have a lot of unused airlines miles? Convert that into funds. The potential is endless.
Ravencoin has already been used quite a bit to tokenize a lot of assets and facilitate a lot of services.
Blocknerd.io is working with Ravencoin and IPFS to build a decentralized web.
Medici Ventures, which is a subsidiary of Overstock.com, completed a $3.6 million transfer using Ravencoin for an equity purchase of Chainstone Labs.
Assure Services, an administrative services based in Utah, issued 700 Ravencoin assets.
The developments above are some of the bigger ones that have happened. There are many others too, which you can view on the Ravencoin Wiki.
The ASIC-resistant Consensus Algorithm, and Other Differences
As mentioned, Ravencoin is fork of the Bitcoin protocol, and thus shares a lot in common with it. However, it differs in some key areas that make it more suitable for the general population to use.
The single most important difference between Ravencoin and Bitcoin is the former’s choice of mining algorithm. It uses the X16 mining algorithm, which is ASIC resistant. It is a Proof-of-Work (PoW) algorithm.
If you don’t know, ASIC units are specially designed hardware that is used to mine tokens. Once upon a time, anyone could mine Bitcoin with their home computers (those were the days!) but now you need entire mining farms to make even the smallest profits from mining.
The Ravencoin team designed the network such that it avoided the need for ASICs so that anyone could become a miner on the network.
Other important changes include the token issuance for rewards and the block time. Bitcoin has a block time of 10 minutes (a new block is generated every 10 minutes), while the Ravencoin protocol issues a new block every minute - a tenth of Bitcoin’s time! It also started with rewards of 5,000 RVN per block, while Bitcoin started with 50 BTC per block. To compensate for this, Ravencoin has a max supply of 21 billion RVN, as opposed to Bitcoin 21 million BTC.
Price History
Ravencoin's price at the time of publishing. Source.
Ravencoin is currently ranked 39 on CoinMarketCap, with a market cap of roughly $128 million. The RVN token has proven to be a good investment for early investors, who would have made a decent profit had they sold the token at the all-time of roughly $0.080. The token’s all-time low is $0.009.
52 week highs and lows are the same figures, with the $0.080 valuation occurring in June 2019 and the $0.009 occurring in February 2019. As you can see, in the span of a few months, the token greatly jumped in price. In these few months, Ravencoin saw itself supported by different platforms, including some platforms using RVN tokenize art, wine futures and others assets.
Ravencoin's price chart. Source.
While there is definitive proof that these developments are the cause behind the token’s price, they are important milestones in the long run, nonetheless. One thing that is noticeable here is that Ravencoin seems to be finding use in a diverse set of applications. Besides tokenization, the token is also seeing use in oracle services, governance and KYC compliance, among other things.
Still, there are plenty of cryptocurrencies in the market, and it’s hard to pick any token over the other, let alone one that is more or less trying to get a share of Bitcoin’s market. Is there something about Ravencoin that could make it an investment with strong potential for good returns?
Investment Potential
There’s no other way to put it but this: Ravencoin may be a bit of a risky investment. There are a few reasons for this.
The biggest obstacle, which all other financial coins face, is that it is going up against Bitcoin. Not directly, perhaps, as Ravencoin’s focus encompasses more than just transactions - it includes all sorts of financial assets, including commodities, art, and anything which can be tokenized, really. The thing is, several third party solutions are being built which link Bitcoin to the tokenization of assets. While Bitcoin may not directly be used for Ravencoin’s purposes, it is not unreasonable to think that there may be some future solutions which make it possible to do all of that with Bitcoin.
Similarly, there are other projects which focus on the tokenization of art, real estate and securities. These are some big projects, like Polymath (POLY), which already possess a lot of clout and make headlines regularly.
Ravencoin’s community-drive approach is also a bit of a double-edged sword. While it certainly lends itself to a more democratic approach to development and mining, it also relies on the community consistently putting in the effort to maintain the network - unlike a team-driven project that is solely dedicated towards the building of the network.
Not that it’s entirely unlikely to become a good investment option. It’s just that it is riding on a lot of factors that may not turn out in its favour.
However, there’s no doubt that there is some potential to the token, if development goes well and it can go on to include more tokenized assets. Ecosystem expansion and steady, consistent growth will be key towards Ravencoin’s growth.
Will that happen? It remains to be seen.
Conclusion
So Ravencoin is certainly an interesting project. Tokenization is a huge deal, certainly, but there are many players vying to become the number one platform in this niche. Following the addition of more assets and feature development, Ravencoin will need to have a strong marketing game - just getting the word out that it is there - to become a main player in the space.
The tokenization market will largely be attractive to people who are interested in other asset classes just as much as cryptocurrencies, and for that reason, it will need to become more well known. There is time yet for this to happen, so the recommendation is to keep an eye on asset tokenization projects and see how it goes.
