Due to Ethereum’s network being unable to keep up with the users, the gas fees are reaching such high prices to the point that some users are unable to use the network. The recent hype in the crypto community caused Ethereum 2.0 mainnet launch to be delayed. OMG Network is a short-term layer-2 scaling solution that processes these transactions with faster speed and lower transaction fees.
By taking a look at gas fee prices throughout time, you can see an obvious difference between gas fee prices two years ago and current prices. You check out this website for up-to-date gas fee prices. It has many downsides, one of which is that it makes defi limited to capitals and excludes other users. Since Ethereum 1.0 is a proof-of-work blockchain, all transactions are processed one by one and it reduces the system’s speed. The more transactions and smart contracts are waiting to be added, the slower the network becomes. It also has a direct impact on gas fee prices, since more users are willing to pay in order to make their transactions process quicker.
A solution to this is to take some transactions off the Ethereum blockchain and add tem into a side chain, By doing this, the network only needs to update the main chain as to its current state instead of processing every transaction. This phenomenon is precisely what side-chain solutions aim to achieve.
Plasma is a scaling framework founded by Vitalik Buterin and Joseph Poon in 2017. Note that this is not a protocol nor a project, but rather a framework which provides tools for blockchain developers to build their own layer 2 solutions.
The relation with mvp is that omg network made some changes to mvp and called it more viable plasma or more vp design.
MVP stands for Minimum Viable Plasma and is the most simplified Plasma implementation for projets wanting to build their own layer 2 solutions. The solutions on Plasma are called Child Chains. Don’t confuse them with side chains, though. Chains on Plasma are reliant on Ethereum’s smart contracts for security purposes, and are optimized for settlement and throughput. OMG Network made changes to MVP and renamed it as More Viable Plasma or MoreVP.
It’s a utxo based non custodial netowork which gives you full control of your keys
Theres no prescribed configuration for a plasma chain. They can take on different consensus protocols, block valifarion mechanisms or fraud proofs. The design is adaptabel to the use case.
Plasma chain is able to guarantee the safety of user funds even if the consensus mechanism fails. This is due to the exit mechaism
MoreVP is a separate Child Chain that is embedded on Ethereum’s Route Chain, and receives transaction requests from users, validates them, makes blocks out of them and published them back to the Route Chain. The network gives you full control of your keys, and there’s no prescribed configuration for a Plasma chain. It is possible to make different consensus protocols and block validation mechanisms. Plasma chain guarantees users’ funds’ safety, even if the consensus mechanism fails. Exit mechanism is the main reason for it.
In order to exist a Child Chain, the user needs to submit an Exit transaction to the Route Chain. Then, the Exit is subjected to a challenge period. During this period, any user can prove if the Exit is invalid, and if it is successfully shown to be invalid, the exit terminates and the challenger is awarded with the Exit bond. All this is to keep users honest and ensure users are withdrawing funds they have a right to.
OMG Network uses a proof-of-authority consensus mechanism. It is run by a block producer node known as The Operator.
Even though the block producer is centralized, the network is decentralized in terms of security because of Watchers. Watchers are the participants that check the Child Chain and does not withhold blocks or tamper with transaction ordering. Needless to say, anyone on the network can become a Watcher.
OMG token has a liquidity score of 71%, and sits on rank 77th of the market cap rankings with a $2.4 billion market cap. It’s ROI over the past year was 469%, which means if you had invested $100 last year, you would have $469 by now. However, similar projects’ ROI in the same timespan is 1,387%. It’s safe to say OMG underperformed in the “smart contract platform” category.
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