What is Qtum?
Qtum (QTUM) is a fully decentralized, peer to peer, microtransaction-friendly cryptocurrency which combines the stability and blockchain technology of bitcoin with the modern features of Ethereum, including the EVM (Ethereum Virtual Machine) and Smart Contracts. It utilizes a Proof of Stake (PoS) blockchain security algorithm and an “Account Abstraction Layer” that allows for multiple instances of an EVM to run simultaneously.
History of Qtum
Qtum was developed by a Singapore based company called Quantum Technology in 2013 and it has received $1 million investment from some big angel investors like Fenbushi partner Bo Shen, BitFund founder Xiaolai Li, Ethereum co-founder Anthony Di Iorio, and more.
The announcement for Qtum took place in late 2016, with the goal of expanding upon Ethereum’s implementation of smart contracts and dApps to make it a business-friendly public blockchain. The Qtum Foundation, which oversees development of the platform, has emphasized users being able to execute smart contracts and run DApps simply and securely, “in environments that were previously out of reach for Ethereum.”
The Qtum Foundation has future plans to implement Oracle and Datafeed functionality, allowing developers to create Smart Contracts on its platform that are built around trusted sources of information.
How Qtum Works
Qtum makes use of the Unspent Transaction Output (UTXO) model from bitcoin and the Ethereum Virtual Machine (EVM) technology from Ethereum to enable businesses and individuals from around the world to create smart contracts easily. Qtum offers a “smart layer” on its platform which enables Ethereum Virtual Machines to interpret the UTXO blockchain data from Bitcoin.
The system uses Proof of Stake (PoS) algorithm to validate transactions. The ‘miners’ will receive the incentive when network consensus is reached and is termed as IPOS (Incentivized Proof of Stake). A smart contract between two entities in the network, two banks for example, can be terminated only by the two parties involved.
Qtum follows the footsteps of Ethereum by offering a hybrid blockchain technology. It offers several advantages over bitcoin and Ethereum by combining them in a single platform. Some of these include:
- Decentralized Apps: Qtum allows developers to build decentralized apps (dapps) on top of their network. This will allow greater flexibility, wider usage and futuristic applications on the network.
- Robust Hybrid Model: Qtum utilizes the transaction protocols of both bitcoin and Ethereum which means developers can build or port their applications, based on either protocol, easily to Qtum.
- Stability of Bitcoin: As far as cryptocurrencies go, bitcoin is the most stable, widely accepted and biggest (in the sense of market capitalization). Because Qtum utilizes the transaction model of Bitcoin, the currency is expected to be stable relative to other coins as well.
- Versatility of Ethereum: Using Smart Contracts and EVM technologies from Ethereum, Qtum offers a futuristic and smart solution where entities can self-govern and transact smartly among themselves.