Vericoin Review – A Unique Coin with Decentralized PoS

Journalist:
July 25, 2014

Vericoin is today’s Random Coin of the Day. I chose Vericoin for its unique outlook on decentralization of PoS (Proof of Stake) within its network. Vericoin uses VeriSMS and VeriBit for this purpose, where VeriSMS allows users to store Vericoin using SMS and withdraw it later, and VeriBit allows you to pay companies accepting Bitcoin, with Vericoin. VeriSMS is capable of being spoofed and hackers can withdraw your Vericoin to their address. Vericoin advises users of this service to not store large amounts of Vericoin through it.

Vericoin is quick to the draw when problems occur with their coin’s block-chain. Mintpal suffered an attack recently and lost 30% of the total Vericoin in existence. Vericoin responded by forking their block-chain before the situation occurred, thus allowing everything to go back to normal. The trade off is that any transactions that occur after the incident will not be available on the new fork. You can read an interview that CCN’s Clay Michael Gillespie had with Vericoin about the incident.

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Vericoin Review

Market Cap: $3,925,405
Maximum coins issued: 26,751,452.35 VRC mined (Total coins in existence: 26,797,500 VRC)
Hash algorithm: Scrypt
PoW or PoS: Both originally, now only POS
Is it able to be mined: Not any more (POW finished May 17, 2014.)
Exchanges: BitOnyx, BitTrex, BTer, Coins-E, Cryptsy, C-CEX, MintPal, Poloniex
Block explorer: CryptoID
Launch date: May 10, 2014

What is the coin’s purpose?

The following is taken directly from Vericoin’s theorem on how POS can remain decentralized and why it’s important.

One of the more important and less discussed challenges in preserving decentralization, which is important for both PoW and PoS coins, is ownership. Centralized ownership can have a direct impact on the decentralization of PoS coins but also has an enormous role in the centralization of power, of PoW coins. In some ways this is an aspect of decentralized currency that is rarely addressed publicly, yet has an enormous effect on the real world decentralization of control.

A simple example is as such if a coins technology is 100% decentralized yet the ownership is distributed such that 10 people own the largest aggregated share of the coin, then inevitably the market value, coin access, future distribution, application and so on, can be directly controlled by those 10 people. Ten individuals with excess power will more than likely be plagued with excess corruption. In this case, the purity of the technology has little effect on the real world decentralization of power and control, and we are immediately back to square one.

That is why VeriCoin’s emphasis is two-fold; A decentralized, secure, proof of stake transaction core and the most accessible technology possible, for the largest number of individuals all over the world. That is why VeriSMS and VeriBit are so important; they remove entry barriers and improve the odds of decentralized ownership being dominant. Accessibility of use can enable an exponential adoption rate and preserve true decentralization of money, power and control. We plan to engage the world with this approach and believe it is the most efficient path to achieving true decentralization, and ultimately enable voluntary access to the many.

What problem does it solve?

Vericoin seeks to resolve the issue of PoS making its coin become centralized with only a selected few owning large quantities. As you can see by the block explorer rich list, their efforts seem to be working for the most part. My guess is the account with 14.36% at press time, is the same address Vericoin said, originally had 9% and was due to being an exchange. After that address in the rich list, it jumps to 6.34%, 4.91%, 3.02%, and the rest have around less than 2%.

Who are the developers?

David Boehm, Patrick Nosker and Douglas Pike are the developers, and you can learn more about them on the team’s page.

What are the coin’s future endeavors?

Vericoin has an Android open beta wallet, and right now, and they’re working on creating a new GUI for their wallet as well.

As Vericoin was not available for an interview, I researched the answers to these questions on the Vericoin website and the official Vericoin BitcoinTalk announcement thread.

Disclaimer: I do not possess any Vericoin and am not part of their operations in any way.

Last modified (UTC): July 25, 2014 13:30

Rick Mac Gillis @ManWithNoBrows

Rick Mac Gillis entered the world of Cryptocurrencies in late 2013. He is a controversial journalist committed to investigating and exposing the "dirty bits" of the community. With over a decade of experience in LAMP web development with a focus in custom cryptographic security methods and ethical hacking, Rick Mac Gillis understands the need for proper security standards in cryptocurrency.