Qtum is a blockchain network founded in 2016 that combines Ethereum's smart contract capabilities with Bitcoin's UTXO accounting system. It achieves this through a technology called Account Abstraction Layer, which gives Qtum the benefit of implementing updates from both Bitcoin and Ethereum.
Qtum is decentralized, meaning there is no permission required to validate transactions. Anyone can run a node, needing only a device and internet connection. Qtum uses a Mutualized Proof of Stake consensus mechanism to disincentivize junk contract attacks. Rewards are split among multiple successful validators and partly delayed for 500 blocks.
Qtum has native support for token standards such as QRC-20, QRC-1155, and QRC-721. The QTUM cryptocurrency is the network's native token, used for transaction fees, staking (which can even be done offline), and governance. You can purchase QTUM on Binance with a credit or debit card or trade for it using other cryptocurrencies.
Qtum is based in Singapore, with offices in Miami and Stockholm.
We've moved a long way from Bitcoin when it comes to blockchain technology. Most new Layer 1 platforms use innovations far beyond the original Bitcoin model. Qtum, however, has taken desirable elements from Ethereum and Bitcoin. This combination makes it a particularly interesting project due to its unique architecture. So, if you've ever wondered what makes Qtum special, Academy is here to run you through its unique aspects together.
What is Qtum?
How does Qtum work?
There are four significant aspects to the Qtum network:
1. A UTXO model for accounting.
2. A Solidity smart contract platform.
3. An Account Abstraction Layer.
What is a UTXO?
Imagine you're sending 0.6 BTC. This actually will be made up of 0.4 BTC and 0.2 BTC outputs from previous transactions. However, if you only wanted to send 0.3 BTC, you would need to split the 0.4 BTC UTXO into 0.3 for your friend and 0.1 for yourself. This leaves 0.4 BTC entirely spent and two new UTXOs of 0.3 and 0.1.
This system of accounting may seem odd, but it has its benefits:
2. A network can process transactions in parallel as every transaction contains independent outputs.
Ethereum, on the other hand, uses an account transaction model similar to what you would find with a bank account. This particular model maintains a global state of all balances on the network.
What is the Account Abstraction Layer?
Blockchains with smart contract capacity don't normally use the UTXO accounting system for technical reasons. Qtum's answer is to use an Account Abstraction Layer (AAL). As the name suggests, Ethereum's accounts system is abstracted from its technical implementation.
AAL works by using a UTXO transaction's output to create a smart contract. It then sends the transaction to the contract account to trigger the contract's execution. The AAL processes the results and adapts them to UTXO.
The AAL technology allows Qtum to take advantage of both Ethereum and Bitcoin updates. For example, when non-fungible token support was added to Ethereum, Qtum had the ability to adopt it quickly. Notable Bitcoin updates were Segregated Witness (SegWit) and Taproot. Being UTXO-based also allows Qtum to benefit from the Lightning Network and other technologies.
What is Proof of Stake?
What is offline staking?
Delegators send their wallet address via a smart contract to a Super Staker. A fee is agreed on that the delegator will pay, and the Super Staker can decide to accept the delegation. The Super Staker can then stake the delegator's UTXOs. If a Super Staker successfully validates a block, they will share a reward with their delegators and charge a fee.
Once delegated behind a Super Staker, you passively earn QTUM. You don't need to be locked into a smart contract, and you can work with an offline solution such as a hardware wallet.
Super Stakers can then win block rewards for the delegates and charge a fee for staking. But after the delegation, the delegator's wallet does not need to be kept connected to the network. In other words, delegates receive rewards in passive mode.
What is QTUM?
QTUM is Qtum's native cryptocurrency, which is distributed to users via the network’s consensus mechanism. You can use the QTUM coin to:
Where can I buy QTUM?
As a solution, the Qtum blockchain is quite unique. It removes the problems seen with Proof of Work (PoW) by implementing a PoS system with upgrades. It allows for smart contracts and Decentralized Applications (DApps) while also using UTXO accounting. While many blockchain platforms in the ecosystem develop brand new methods, Qtum has taken successful functionality from previous ones. So, if you've been considering Qtum as an altcoin, you now can make a more informed decision based on its use cases.