BlockTalks x Jax.Network AMA Transcript!
Hello! BlockTalkers & Blockchain Enthusiastic!
We recently hosted an AMA with Jax.Network, on May 30th at 2.00 PM UTC. Many of you might have participated or many of not. But we make sure no one missed out from the knowledge shared by Vinod Manoharan, Founder & CEO of Jax.Network and Lucas Leger, Chief Economist of Jax.Network. So here we are up with the AMA transcript, for those who missed the live session, this blog post will be a saver & feeder of knowledge for them.
Introduction Questions Asked By Team BlockTalks!
Q1. Could you please introduce Jax.Network to our community in layman’s term?
Ans — Yes, we bring scalability and a decentralized stablecoin to the Bitcoin and DeFi ecosystem. In a nutshell.
Q2. What are the advantages of Jax.Network to other alternatives in the Blockchain field?
Ans —
- We have an in-protocol decentralised stablecoin that doesn’t pose the centralization risks that USDT/USDC/BUSD and many other existing stablecoins have.
- Users on our blockchain could be certain that they won’t ever experience high transaction fees as our network utilizes Proof-Of-Work sharding to bring scale and this would eliminate congestion and hence eliminate higher transaction fees due to network congestion.
Q3. What are the major milestones Jax.Network achieved so far & what are in the future pipeline?
Ans — Past to-date:
Q4 2017: We got into the blockchain space.
2018: We were researching other blockchain projects and trying to understand what's causing the high consumer confidence (in terms of valuation) of crypto assets and what is the future of the industry, the problems that are inherent. We understood it's scalability and volatility problems.
2019: We set about to solve the scalability and volatility problems and started researching in this direction.
Q2 2020: We finalised our protocol paper. You can find it here: https://arxiv.org/pdf/2005.01865.pdf
Q3 2020: We started development of our protocol.
Future:
Q2 2021: We are about to launch our TestNet in June 2021 (next month).
Q3 2021: We will be launching our MainNet.
Q4 2021: We will start getting miners onboard and listing our coin on exchanges to promote the use of our stablecoin.
Questions Asked on Twitter For Jax.Network Team!
Q1. Most people do not see Ethereum and Bitcoin as currencies, rather they see them as assets, it's even rare to come across any merchant accepting btc or eth as means of payment. So what solution has Jax Network come up with to help bring cryptocurrency to mainstream day-to-day use?
Ans — That’s right. Ethereum and Bitcoin have their own value. BTC is more like a commodity for the whole ecosystem. Ethereum is gas for smart contracts. Money is something else, money is used to ease up transfer of utility, meaning transfer of consumer preferences.
ETH and BTC are clearly deflationary and asset-like. While for a currency, you need a slightly inflationary medium of exchange. This is the purpose of our JAX coins, they are built to be slightly inflationary and follow the cost of hashrate. Therefore, decentralized and useful for day to day payments.
Q2. What is the strategy used by Your Project to attract new users and investors and keep them in the long term?
Ans — Our decentralized stablecoin could act as a replacement for USDT. As USDT is centralized, there could be risks for the whole DeFi ecosystem in the future if USDT collapses. We eliminate this risk with our decentralized stablecoin proposal. We will initially go-to-market by :
1) Enticing BTC miners to merge-mine our our network. We see that our target audience is primarily miners as we build a very sustainable business model for miners as they could earn extra coins and extra transaction fees as the process our stablecoin transactions.
2) Enter the remittances / unbanked population markets by offering lesser markup rates relative to USDT for senders and receivers and by providing a better currency for countries which suffer from hyper-inflation.
3) Provide a decentralized money API for people who would like to interface to our decentralized stablecoin in the DeFi space through dApps.
4) Focus on ecosystem growth to bring more applications on Layer 2 through smart contracts on top of our stablecoin blockchain.
As our ecosystem grows, the value of our asset coins, which represent the overall value of our ecosystem should grow, hence delivering value for investors.
Q3. As an investor in the world of Blockchains, I would like to know what makes your project different from the rest that already exists. What makes them safer and more efficient?
Ans — Most famous blockchains like BTC, ETH don’t scale and hence are subject to high gas/tx fees based on demand. New/Upcoming projects mostly focus on providing smart contracts for dApps.
In contrast, Our blockchain is scalable. So, there won’t be high transaction fees as in other blockchains. Also, we house a decentralized stablecoin within our protocol, whereas other blockchains have only deflationary assets / centralized stablecoins.
The decentralized stable-coin is something that's a unique value-addition of our blockchain to the cryptocurrency ecosystem.
Q4. Safety and security are always the most important things. So what is the security mechanism of Jax Network to ensure user data do not become the target of hackers?
Ans — Jax.Network blockchain follows the standard 51% honest hashrate mechanism of BTC blockchain. So, the security of the network is the same as that of the BTC network.
Additionally, we have a coinbase hack - we call it the "Proof of Value" mechanism where people have to burn (BTC + JXN) to create our stablecoins, and using this innovation, we are able to borrow the security of the bitcoin network without having a minimum cost of security as other blockchains such as Bitcoin Cash / Bitcoin SV.
Q5. Given that JaxCoin is structured in such a way as to make it resistant to inflation, how then could this potential technology work in countries in Africa or Latin America where hyperiflation is a current problem?
Ans — Interesting question. We have 2 coins in our network in order to decouple speculation (JAXNET coins) from transaction (JAX coins) purposes. This helps balance the value of JAX overall and stabilize it. Therefore, it will be easier for those continents to rely on our coin, as long as it performs better than the USD in terms of purchasing power. And we argue it does.
Questions Asked by our BlockTalks Community Members during live Session to Jax.Network Team!!
Q1. I read from your website, There are 2 way to gain benefits from JAXNET:
-By becoming a miner
-By becoming a Transfer Agent.
I' m not completely understood with "Transfer Agent".
could you briefly explain what is the requirement & the mechanism to become a Transfer Agent?
Ans — As a transfer agent you can provide liquidity to the network. The transfer agent is key as he or she will operate cross-shard transactions. Say you hold 100 coins in shard A, you can swap them with a fee tto other shards.
Q2. "STAKING" is one of the strategies to attract users and hold Them long term. Does your great project have plan about Staking?
Ans — As a transfer agent, you get rewarded with cross-shard transaction fees. At a later stage, staking will possible with our layer 2 solution, to fasten transactions on the network.
Q3. I read that Jax Network has come up with a different way of incentivizing miners which is totally different from that of Bitcoin and the likes. Can you please explain further on this? How are miners on Jax Network incentivized?
Ans — Yes, you have a different block reward function, which is proportional to the hashrate.
Q4. Sharding, Layered, and Cross-chain are the three future solutions for Blockchains to gaining high-performance.
In which direction are JAXNET stand now?
Many Project considering to add privacy features such like ZK proof for their platform auditability.
Will JAXNET add this technology in its platform?
Ans — We have pure state sharding. All shards are independent but equal mathematically through our shard block reward.
Q5. Jax Network has a fair merged mining function but could you please explain more about this merged mining model and how beneficial it is for the project ecosystem and the users who work for the Jax Network?
Ans — Our reward function is based on the difficulty of the network. In BTC network, you get 6.25 BTC reagardless of how much is the hashrate or the difficulty of the network. Our stablecoin reward function is R = k*D, hence a strong miner with lesser D would get more coins and a weak miner with smaller D would get lesser coins. This is proportional to the effort in maintaining the network and hence is more decentralized.
It's benefecial because in general merged-mining kills decentralization. But, due our merged-mining solution innovation, we are able to retain a high level of decentralization while brining scale.
Q6. What are the advantages of holding your token as a long-term investment? Can you tell us about the motivation and benefits for investors to hold your project tokens in the long term?
Ans — JAXNET coins are representative of the overall value of the network, while JAX coins are purely transactional. JAXNET are similar to BTC, except that there is no max supply. Just approx 1mil coins per year are issued.
Q7. How Decentralized is Jax Network. Many projects claimed that they are decentralized but after a while they turned into centralized. Will Jax Network always stay decentralized? Will your token distribution fair enough to be decentralized?
Ans — Yes, Jax.Network will always be decentralized. There’s simply no validator or any other concept of PoA or DPoS in our protocol. It’s as decentralized as BTC and will stay so. It’s beyond our / anyone’s control. Ultimately, it’s controlled by miners as BTC.
Q8. As I understand, the Jax Network blockchain is suitable for mass adoption, therefore, within real-life use cases, can Jax technology be used? For example: Internet purchases, daily payments in coffee shops,etc. And how could a credit card be implemented by an application QR code?
Ans — Yes. As for credit card payments, this is more like a long term goal. First, we are targeting the remittance market.
Q9. Being a scalable, decentralized and secure blockchain, I would like to know if the Jax Network project will be able to support and provide support to a growing segment of the crypto space such as NFTs and the DeFi world in general?
Ans — Yes, it would support the DeFi world with a decentralized stablecoin to minimize the risks which come from collapose of centralized stable coins.
NFTs could be integrated on Layer 2 smart contracts. We will get to this after we have built a business model on top of our stable-coin. This is part of our future roadmap.
Q10. Can you briefly explain the method of Distribution of tokens? How many tokens Will be distributed ? And How many tokens Will be locked by the team? From where investors can buy Tokens?
Ans — Team + Advisors
9.95%
2-4 years lockup from mainnet launch-date
Seed Investors
2 years lockup from mainnet launch-date
Public sale purchasers
0-3 months depending on discount slab.
More details about our token sale will be released a bit later when we are ready with our TestNet.
Q11. What will Jax stablecoin be pegged to?how that can be stable then? All stablecoins must be pegged to something to be stable and exclude price fluctuations.
Ans — Indeed. We peg the coin to the cost of hashrate, which is stable over time. We have some economic incentives at the protocol level that miners strictly follow the demand of JAX coins. 1/ You have to send your BTC expected coinbase reward to an invalid address in order to mint JAX. 2/ we have a k-coefficient that is voted for in order to prevent depreciation of the cost due to productivity gains in the mining equipment.
Q12. How do you manage to maintain the same level of security as BTC or digital gold?
What is the link between JAX coins and the BTC blockchain? How will you standardize these coins?
Ans — JAX coins are created based on the network hashrate when BTC is "statistically" burnt.
So, They are standardised by the hashrate of the BTC Network.
Q13. It’s quite unfortunate that many projects have infiltrated the market with just white papers without having any genuine use cases. What are the main utilities of your coin?
Ans — We welcome peer review of our protocol. Overall, we argue that our coin is decentralized and it’s cheaper to deal with for remittance and DeFI transactions when they have to deal with stablecoins.
Q14. Can you list 1-3 killer features of Your Project that makes it ahead of its competitors? What is the competitive advantage your platform has that you feel most confident about?
Ans — Stability in purchasing power, scalability and decenntralization.
Q15. So ASICS will dominate completely. Is it a self-chain or an ERC20 token that relies on ETH? How Jax will keep its network safe from 51% attacks?
Ans — Yea, we researched this in depth. Even GPU mining is becoming an increasingly difficult business. At a protocol level, It wouldn’t be difficult to bring in GPU mining, but this makes the network too heavy in terms of traffic and storage to add the DAG as in ETH.
Q16. I learned about ASIC resistant coins (about their existence). But I was just wondering which coins are now resistant to mining. And why are they limiting their blockchain from ASIC mining.
Ans — The moment you allow ASICs, chip manufacturers might control the ecosystem and the currency. I believe, it’s a political choice by the founders of the protocol to contain the power of the mining equipment manufacturers.
Q17. How they make JaxNet safe, scalable and decentralized?
Ans — We use sharding and merged-mining in order to achieve that. Using a PoW consensus algorithm.
Q18. Which market will be the best target market for Jax Network and how your strategy to attract them?
Ans — DeFi stablecoin market.
International payments.
Alternative for your VISA/Mastercard purchases.
Q19. How does the JaxNet protocol’s unified mining algorithm connect to the Bitcoin ecosystem? How is this algorithm different from other algorithms?
Based on Jax’s Proof of Work
What is the advantage of your work? What is the advantage of the mining solution that Jax offers?
Ans — Our reward function is based on the difficulty of the network, while BTC reward / ETH reward is fixed. This makes ETH / BTC deflationary. Our reward function promotes productivity.
Deflationary coins promote people to hoard as that's the most optimal strategy. This won't help the economy in the long run and hence our function.
Also, this helps scale the network without killing decentralization.
Q20. During the 2020 and 2021 I got scammed a few times, rugs, exit scams etc. my question, how can we investors be sure that this will not be similar, are your contracts public & somewhere to be seen?
Ans — Sorry to hear that. You can do your due diligence through our website jax.nettwork and our gitlab. Everything is there.
Q21. When was Jax.Network founded and why did you build the Jax.Network project?
Ans — Founded in 2018.
We have built it to bring our philosophy of free-markets of currency and decentralized communities for an integrated world working towards making humanity a type-2 civilization.
I am writing a book on implementing democratic socialism on scale using blockchain technology. Happy to share it when it's ready.
Q22. Why is Jax Network aiming to be better than Bitcoin and Ethereum? What benefits will they obtain if it exceeds the 2 projects mentioned?
Ans — We are not aiming to be better than BTC. We simply improve BTC by bringing scalability and a decentralized stablecoin to the BTC ecosystem. We simply would like to implement satoshi’s vision of electronic cash not electronic "assets".
The benefits for early adopters would be that the value we bring to the BTC ecosystem will be captured by our asset coins and hence we would all go to the moon I hope.
Q23. This is the first time I am hearing of a blockchain technology with only 1 one native digital token. I hope this isn’t just for show off purpose. What are the benefits of having two in your ecosystem?
Ans — There’s a benefit. It incentivizes BTC miners to defend our network in the early stages. Also, our beacon shard is the universal source of truth (within our Jax.Network universe) and is needed for maintaining critical network transactions and the shard registry.
We want to decouple the transactional and speculative purposes of the coins, and balance the value of the transactional coin through economic incentives. In that case, having 2 coins helps separating the two and achieve stability.
Q24. Creating a token is easy, however maintaining stability is difficult. Especially if you don’t have a sponsor, are you considering how to protect investor interests and how to achieve this goal?
Ans — Right, there are two coins in our network.
1. Asset coin - it’s speculative and will represent the overall value of our ecosystem. (Investors should get these ones) ticker: JXN
2. Stable coin - will be stable based on the cost of production.
How to achieve this goal? Bring more adoption, grow the ecosystem and the value will grow.
Q25. Does your basis only peoply of your own country or all over the World?
Ans — From everywhere! Merit and value iss universal.
Q26. Can you share some more insights on JAX.NET as to the long term plans of the project keeping in mind the stakeholders interest & adoption in the real world without compromising on regulatory front?
Ans — Right, initially we would cater to emerging markets to stay away from high regulations. Once we build more revenues, we will work with regulators to roll out necessary legal frameworks. I have extensive experience in this field. We lobbied for a state-level bill in India in the past. We have a long-term plan for 20 years. We are already 3 years in. Let’s move fast.
Q27. Can Jax Network ensure there will be no slippage on every transaction? And what about your gas costs?
Ans — Should be very low, a few cents, as we scale on demand. Never going to be as high as ETH gas fees.
Q28. What will Jax stablecoin be pegged to?how that can be stable then? All stablecoins must be pegged to something to be stable and exclude price fluctuations.
Ans — We are pegged to the cost of hashrate.
Q29. Hacking incidents can be seen even on systems with the safest infrastructure in the world. Is your project system safe enough from hackers?
Ans — We follow the same BTC 51% honest hashrate model. So, if BTC is hacked, we have risks.
Q30. Enlist any 2 killer features of Your Project that makes it Unique and Useful than other? Why investors should choose your project? And why they should trust your project?
Ans —
- Decentralized stablecoin for the DeFi space
- Lesser markup rates than USDT which would bring more value to the DeFi ecosystem users and hence grow the value of our asset coins.
About trusting us, happy to pass your due diligence, please reach out to us.
Q31. How Decentralized is Jax Network. Many projects claimed that they are decentralized but after a while they turned into centralized. Will Jax Network always stay decentralized? Will your token distribution fair enough to be decentralized?
Ans — Our mining algorithm and merged-mining solution helps small nodes, they can choose what coin to mine and get rewards and collect fees on shards.
Q32. Currently one of the issues that blockchains must address is to be low-polluting and reduce electricity costs, but in terms of pollution and electricity consumption, how harmful is the Jax Network smart chain?
Ans — We use a Proof of Work system as this is the only way to create a truly decentralized system. Also, we anchor to BTC and re-use the BTC hashrate and hence there’s no extra hashrate.
However, we bring value to the BTC network and we anticipate that the BTC network difficulty would go up.
As we succeed, we will allocate some part of our profits into research in this direction to improve. Infact, the people who innovate in sustainable energy will control our ecosystem ultimately.
Q33. Which market will be the best target market for Jax Network and how your strategy to attract them?
Ans — Stablecoin and remittance markets.
Q34. Which areas Jax.Network projects focused on and where are you planning to expand in the near future?
Ans —
- TestNet development
- MainNet Launch
- Initial roll out of our stable-coin and market making
- Awareness
Q35. I just saw official Jax Network Telegram group that Jax’s public sale is running, So my question is when will Jax listed on any CEX or DEX exchanges?
Ans — Continue to follow our group chat to get the last updates. We will make public announcements there.
Q36. From what I could understand JaxCoin is not a standard currency tied to some type of merchandise or a fixed offering currency that would artificially increase its market value. So, what economic incentives does JaxCoin use to guarantee a stable and sustainable economy?
Ans — It’s related to the hashrate of the network. More info on our paper.
Q37. One of the important things is partnership! would you like to share some of the partnerships you have formed with the blockchain foundations that have been around recently?
Ans — We are in the process of partnering with chip manufacturers and miners. We will keep you guys posted through our website: https://www.jax.network and our telegram group.
Q38. I’m so impressed to see that Jax Network satisfies 4 major criteria in the blockchain space, which are Decentralization, Scalability, Security and Stability. Can you tell us how you were able to achieve this? Even Ethereum and BTC still find it difficult to achieve this.
Ans — Yes, it’s difficult to achieve scale for ETH because they have smart contracts on Layer 1. This leads to a dead-end in terms of the data availability problem.
We in contrast, only solve scalability in cryptocurrency transactions. Layer2 will address smart-contract scaling.
You can read our white paper: https://arxiv.org/pdf/2005.01865.pdf
Q39. Can Jax Network ensure there will be no slippage on every transaction? And what about your gas costs?
Ans — We are not ETH based, it’s a standalone network. It’s more profitable to collect transaction fees on shards for miners. And we can scale on demand according to some protocol parameters, hence keeping transaction fees low. It’s a transactional network, no smart contracts here. It will be developed later as we want first to scale and bring stability in a decentralized fashion to the community.
Q40. "STAKING" is one of the strategies to attract users and hold them long term. Does your great project have plan about Staking?
Ans — Yes, you can stake JAX coins and earn liquidity rewards through our Transfer Hub.
Q41. Can Jax Network ensure there will be no slippage on every transaction? And what about your gas costs?
Ans — Smart contract as layer 2.
Q42. Some projects cannot handle the stress of Bear market and the recession. Covid virus is not helping as well. How will you prevent this bad situations that the crypto markets have?
Ans — Well, in the long term, good cryptocurrency projects will grow. We either believe in crypto currencies or we don’t.
So, we are in this for the long-run. And we will be fine!
Q43. What is the main reason a user should join the JAX NETWORK project? Does JAX NETWORK provide special features that are given to users who join?
Ans —
- As a user, you could be more safe by using JAX coins instead of USDT as they are decentralized and can’t crash overnight.
- As a community participant, it’s about getting in early into a tech that brings scalability and stability to the BTC + DeFi ecosystem and supporting each other by active participation.
Q44. What is the commission when paying for Jax?How do you think when will video cards fall in price?
Ans — Transaction fees, but they will remain low as we scale on demand. We use ASIC.
Here are some important links of Jax.Network👇
🌎 Website: jax.network
📱 Twitter: twitter.com/CommunityJax
📢 Telegram: t.me/jax_chat
▶️ YouTube: www.youtube.com/channel/UCGLFiBG4j-CzEs9TFTKk51g
