Blockchain projects are a dime a dozen now. This has attracted mockery from both those inside and outside the space. This is fair - so many projects these days seem to come up with a business idea without realizing whether or not the technology is actually suited for it.
And that’s definitely an issue, if you’re an investor who is trying to make sense of the hundreds of options to invest from. I think there’s almost 4000 now. How is an investor going to be able to get an idea of what these platforms are about? It’s tough even for someone with experience.
One way to make it easier for people is to narrow down their investment offers and focus on specific use cases where Distributed Ledger Technologies (DLTs) happen to find a lot of applications. For example, decentralized finance services is a very popular space that many say will propel the market forward in 2020.
Others focus more on technical aspects that offer its users much better outcomes compared to rival platforms - better consensus algorithms, easier Decentralized Application (DApp) development and other such solutions.
This trend of developing new platforms that are using recently discovered or invented solutions is a growing one. Mind you, there is still plenty of reason to be cautious about these projects. One of the best things about Bitcoin is that it has been tested in the wild for 10 years. It has the strongest network.
The project I’m going to review today is V Systems (VSYS), a decentralized cloud database blockchain-based platform created by Sunny King, who created the Proof-of-Stake (PoS) consensus algorithm that we all love so much.
I’ll explain what exactly the project is, its history, the technical design and features, and of course, the investment potential.
What is V Systems (VSYS)?
Described in the simplest terms, V Systems (VSYS) is an infrastructure project for a decentralized cloud database. The project has several documents that describes its purpose and design in much greater detail. I've gone through it so you don't have too.
The idea for V Systems was originally conceived in 2016, though things only really started taking off in 2017. V Systems is led by Sunny King, who invested the Proof-of-Stake (PoS) algorithm that is so widely in use today. Sunny King is a pseudonym, and King has influence in the space.
The main thing that V Systems wants to do is create an infrastructure layer for blockchain platforms and decentralized applications - to offer better efficiency and security. This is mostly achieved through the Supernode Proof-of-Stake (SPoS) algorithm, which King created. The team has described the platform as “a general purpose blockchain database for decentralized applications.”
The team has said there are multiple applications for the V Systems platform, including decentralized finance (DeFi), social media, entertainment and other areas. It may be some time before we see these applications come to life, given that the team plans to release the cloud platform next year.
The 4 major components of V Systems
On that note, let’s talk about what the team HAS achieved.
Since being conceptualized in 2016, V Systems has come a long way. 2017 was the year in which the first whitepaper was posted and also saw the launch of the website. The next year, 2018, has probably been the most pivotal year for the project, as it was the year in which SPoS was announced and the mainnet launched.
V System's roadmap shows quick progress, with the cloud platform due in 2020
2019 was more of an ecosystem and expansion year, with the VSYS token getting listed on multiple exchanges. Other notable developments of this year are that smart contracts were launched and support for enterprise grade DApps was introduced.
As for the future, the team expects to release the cloud service platform and the decentralized general purpose database, upgrade the smart contracts, and upgrade the enterprise DApp support. Beyond that, we do not know how the team plans to enhance the platform.
I’ll move onto the technical features that make V Systems unique.
There are a couple of things that distinguish the V Systems blockchain from other blockchains.
The most important of these is the fact that the consensus algorithm is the Supernode Proof of Stake (SPoS). The whole design is reminiscent of the Delegated Proof-of-Stake (DPoS) algorithm that EOS (EOS) uses.
The network contains supernodes, which perform the role of miniting blocks. They get a minting reward for this. Regular users can give minting rights to supernodes, which are like minting pools. The cut is as follows: regular users get 80% of the rewards from generating blocks, while supernodes get 20%.
In order to become a supernode, one must challenge existing supernodes. Once the application is accepted, the average mining balances of both users are compared and the one with the higher balance is the supernode.
The SPoS whitepaper explains this in greater detail.
Another technical feature worth mentioning is the design principles of modularity. In order to lower development costs and system complexity, the team wants to make the network as modular as possible. This includes several layers of the protocol, and system components such as pluggable consensus models, database management components, several kinds of wallets, and much more.
Lastly, you can also create your own tokens on the V Systems blockchain.
King is a highly respected developer, with the Supernode Proof-of-Stake algorithm being preceded by many other development efforts.
King appears to be a private person and there is comparatively little information about him on the internet. He has agreed to do several interviews, however (with his identity hidden). Despite this relative quietness, King has done much in terms of development, having also launched the Peercoin and Primecoin projects.
V Systems has provided some insight into King’s aptitude and general approach into development. Given that King has such a defining role in the development of VSYS, it’s worth looking into this.
According to the post, “the basis of Sunny’s PoS innovations has been to make blockchains more efficient and stable — if they can be made cheaper to create and run, they [can] be used to host decentralised databases which in turn can drive all manner of businesses and societal functions.
King has a very defined goal in mind when it comes to furthering the space: he wants to remove the barriers to building blockchain applications and streamline the whole process, while simultaneously offering some societal value. These ideas are commonly held in the crypto space, but it is how it is executed that matters.
The runup to the creation of SPoS saw multiple refinements on King’s part to the creation of a high performance blockchain infrastructure platform with strong security. With improvements like, security and scalability could help achieve the vision that King had in mind: that billions of blockchains would one day exist.
V Systems launched the VSYS ICO in March 2019, raising a modest sum of $600,000 million. That’s not unsurprising in 2019, given that the ICO market has dropped drastically since 2018. The crypto market is ever-changing, right?
For a token that’s only been available for about 10 months, it’s done pretty well, rising to 60 on CoinMarketCap’s market cap rankings. The total market cap currently stands at about $60 million.
The current price of the token sits at $0.03, which was exactly the price it was when it first started trading. The all-time high was $0.29. Not a bad profit if you timed your investments right.
It’s hard to get a sense of investor sentiment and future potential from such a short existence, but let’s give it a try.
V Systems has been thorough with its technical documentation and in describing what and how it wants to do.
There is demonstrable proof that it has technical advantages and it’s roadmap and general business plan moving forward seems sound. Additionally, it has a track record of hitting its development milestones. All of this together makes V Systems a project that is at least worth looking at.
You can’t really tell in this market by when and how much a certain token is going to reach. It’s got quite a large circulating supply. There is no guarantee that it is going to be a top platform for its purpose, but it’s got potential to become so.
In the event that it does carve out a space for itself, how high can we expect VSYS to go? Perhaps in the few dollars range?
That’s so hard to answer given the many unknowns that it’s better to monitor the project and see how it shapes up with time.
There’s a lot working in favour of V Systems. You can imagine that there will be a need for better infrastructure when decentralized applications become more of a commercial product. The team is also focusing on enterprise level applications, which is a good move. You need enterprise adoption if you want to grow.
The transaction performance and general technical gauges also show that there is substance to V Systems claims. This kind of performance is necessary for large scale DApp usage and enterprise use.
Sure there is competition here, but it’s hard to say which DApp-focused platform can take the major share of the market. Yes, we are likely to see Ethereum (if it can bring its much anticipated technical improvements) be the major name in the future, but that does not mean there is room for other projects to succeed and flourish.
Depending on your risk appetite, you may want to consider adding V SYS. If you prefer to stay with just the main coins and a few altcoins, then perhaps you shouldn’t consider it.