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Qtum Definition

What Is Qtum?

Qtum is a cryptocurrency that mixes Ethereum’s sensible contract performance with the safety of Bitcoin’s unspent transaction output mannequin (UTXO) to create a platform that’s appropriate for adoption by giant organizations. Qtum was based in 2016 by Patrick Dai, Jordan Earls, and Neil Mahl, and its initial coin offering (ICO) was held in March 2017.

As of October 2021, the coin was ranked #91 by total market cap, with the worth hovering round $13.45 with a market cap of $1.4 billion.

Key Takeaways

  • Qtum is a cryptocurrency that mixes the safety of Bitcoin’s blockchain mannequin and the pliability of Ethereum’s sensible contracts.
  • It makes use of a proof-of-stake consensus mannequin for creating new blocks, which is much simpler and fewer energy-intensive than Bitcoin’s proof-of-work mannequin.
  • Qtum is designed to be used by giant organizations, with the aim of changing into integral to a spread of industries, together with finance and social media.

Understanding Qtum

The founders of Qtum (pronounced “quantum”) sought to mix a few of the finest elements of each Bitcoin and Ethereum, with the aim of changing into a safe change for business-focused decentralized functions (dApps). Qtum hopes to disrupt the web transactions market and turn out to be an integral a part of industries similar to finance and social networking. Its foreign money is known as a token.

One core factor of Qtum borrowed from Bitcoin is the UTXO mannequin, a form of accounting system utilized by Bitcoin that gives a excessive stage of transactional safety. The UXTO system offers a kind of receipt for unspent cash after a transaction. Qtum copied and reworked Bitcoin’s UTXO code for its personal platform.

Qtum borrowed sensible contracts from Ethereum. Sensible contracts are blocks of self-executing code that, as soon as verified on the blockchain, perform the phrases of the deal, making the contract irrevocable.

Qtum, Bitcoin, and Ethereum

Whereas Qtum borrowed from each Bitcoin and Ethereum, it differs from each of its much-bigger competitors in key methods. To start with, Qtum deployed what it calls the Account Abstraction Layer (AAL), the expertise that permits using sensible contracts along with the UTXO mannequin. AAL permits the UTXO and sensible contract fashions to work together.

Qtum additionally makes use of a proof-of-stake (PoS) consensus mannequin fairly than the proof-of-work mannequin utilized by Bitcoin. This makes it simpler to mine new cash. Bitcoin’s PoW strategy is resource-intensive, inflicting the pc networks mining its cash to eat extra electrical energy yearly than many whole nations. A PoS strategy simplifies the method and leads to a lot much less energy consumption.

With a PoS system, miners are chosen to confirm blocks primarily based on their very own stakes within the system, fairly than who can clear up a fancy math drawback the quickest. The larger the stake, the better the person’s likelihood of being chosen to confirm the transactions.

Investing in cryptocurrencies and different Preliminary Coin Choices (“ICOs”) is extremely dangerous and speculative, and this text will not be a advice by Investopedia or the author to spend money on cryptocurrencies or different ICOs. Since every particular person’s scenario is exclusive, a professional skilled ought to all the time be consulted earlier than making any monetary choices. Investopedia makes no representations or warranties as to the accuracy or timeliness of the knowledge contained herein. 

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