What follows is the resume of the transcription.
Lea – Girl Gone Crypto:
The topic of atomic swaps has been a big kind of thing in the orbit for a few years now, and what you guys are working on with a fiat-crypto swap is pretty interesting. So, anyway before I give it all away, to kick things off, why don't you just give us a high level overview of what Nimiq is, and then we'll dive into it from there.
Max – Nimiq:
Let's first start with a rough overview, my name is Max, I'm the ambassador and spokesperson for the Nimiq project. We are an open source not-for-profit blockchain project, aiming to make truly decentralized blockchain technology accessible for everyone around the globe. That means if you are a person who has only heard of crypto, but you didn't really have a touch point with cryptocurrency before, we are taking like the real deal of blockchain and cryptocurrency, and making it very easy and accessible for everyone, with prior knowledge or without prior knowledge, by also removing all middlemen.
This is kind of the game we're in, finding and identifying the middleman and removing them, that means that everyone who is for example creating a Nimiq wallet, which is our web wallet is actually running a light client and nano node in their browser so it's not in only an interface that is connecting to some node, or like server farm in in some basement, but we actually are running a node inside the user's browser so that they are what we call first-class citizens of our blockchain network, and this is the the spirit that we have.
We want to stay truly decentralized as much as possible. We love this concept of self-custody, that you are actually responsible for your money and for your financials, and trying to identify where the middlemen are, that are either telling you what you are allowed or not allowed to do, or they're taking a cut from your money, and we're trying to get those out of the game. This is also where our our vision was born of how amazing would it be to have an atomic swap between fiat currency and cryptocurrency.
For someone who's watching this, that maybe isn't familiar with the term atomic swap, and doesn't know what that means, can you give us just a quick definition of that and then I'm excited to dive into it a little more from there.
An atomic swap is basically an exchange of assets with someone that you don't know and don't trust, in a self-custodial way. That means that you hold your asset until you are sure that you're actually getting in return what you want. So, in blockchain technology when we're talking about two cryptocurrencies, for example, there are special smart contracts on blockchains. They are like a safe with a time lock on it and if you have two blockchains with two such safes then I can say, hey Lea I want to exchange NIM for bitcoin, so you bring the bitcoin I bring the NIM and what we do is, I lock up my NIM, so I send my NIM to this special smart contract with the time lock on the Nimiq blockchain, and then you send your bitcoin to this special smart contract on the bitcoin chain and there is a protocol that monitors if both safes are filled.
So, let's say if both safes are filled you know it because that's easily visible on the blockchain, it's verifiable publicly. The protocol says, hey cool, Lea and Max both showed up with the asset, so this protocol reveals a secret and those two assets get exchanged so you end up with my NIM and I end up with your bitcoin.
In case one of us shouldn't show up, that is, where once the time lock is over and the other party didn't show up, one of the safes is empty the other safe which is filled is simply given back to the original owner. So, even if we don't know each other we can be sure that only if both assets are in those safes, then they get exchanged. If one person doesn't show up, there's no central custodial intermediary that that keeps the asset for us. Let's say it's not a limited or an incorporated or a business that is actually taking care and having both of those assets and keeping them, it's fully automated electronic between two smart contracts, and the special thing is that until now this only worked with cryptocurrencies, and we developed the first safe, the first hashtime lock contract, which is the name of this special smart contract, that actually understands and works with fiat.
So, this is a normal bank account, run in our case by a fully regulated german bank that serves the entire european SEPA space, and we took that bank account and transformed it into a smart contract that can interact with blockchain technology so now you can not only exchange crypto assets with this amazing self-custodial technology, but also fiat for crypto, and this works for buying and selling. This is the most decentralized way of buying crypto with fiat without any custodial intermediary that has both assets at the same time, and actually manages this exchange.
So, this is amazing, it's live already. If you for example visit supersimpleswap.com, and in case you have euro, you can already use it, but we are also working on bringing this technology to other fiat currencies of course.
Walk us through a little bit more how this is different than other current fiat to crypto on ramps. Is the main defining difference the custodial piece of things, is there potentially another layer of privacy here. Kind of walk us through a little how it's different than how people are currently exchanging their fiat into crypto.
Usually, and this is crazy, we're living in this beautiful crypto decentralized world of cryptocurrencies and blockchains, but the ways in and out of this world are run by companies. Let's just call it a centralized exchange. You are keeping your crypto money on an account on a centralized exchange. Centralized means that it's some sort of company in a country, let's say that as a user, by keeping your money there, you are trusting this entity to handle your money correctly, and not to be fraudulent and give your money back.
You're trusting this entity and usually when you're buying and selling cryptocurrencies there are specialized businesses that take your fiat money and give you crypto for it. But you have to think of, if I am the company I say hey Lea, okay I take your 100 dollars or 100 euros, and I keep this money and I am giving you the cryptocurrency for it. There is a central entity that takes your money and gives you the other asset.
We are introducing a more decentralized approach of replacing this company in the middle through a protocol, and all the protocol does is, it monitors those two safes. Basically the fiat currency and the cryptocurrency they come from external liquidity providers, there is not like a central entity that takes your asset and gives you the other one. There is only a smart contract controlled bank account and the hashtime lock contract on the bitcoin and the Nimiq chain, and the protocol is actually running locally, so you can't manipulate it. If you have an atomic swap, you either get what you want or nothing happens at all, and it just gives you the money back.
So, we are removing the centralized company or service. All of those swap services can swap one asset for another, basically what happens is you send your asset, they are trading it on an exchange, and get their cut and send you the other asset, this is a typical business model in the crypto fiat on- and off-ram industry, and we are making this more decentralized and giving self-custody back to the users by being sure I hold on to my assets until I'm very sure that I receive what I want to get, and this is for us a paradigm shift.
It's the first kind of technology that really enables such a non decentralized way of buying and selling. Of course you still have a bank account but this is smart contract controlled, it doesn't keep money. There is no equivalent in crypto, kind of, it really doesn't even keep the fees. It's really amazing, but a bank, a fully licensed bank, is still the the most trustworthy entity in the fiat network in the traditional word that you can have. It's controlled by the government so it's not just a private company owned and run by someone, but this is as good as it gets when it comes to security, and we're just using this smart contract bank account to perform this atomic swap. I hope that made it a bit clearer.
It does, and another area that I want to kind of jump into, that I noticed. You guys are focusing on the crypto payment provider piece of things, and so can you kind of walk us through how that works and kind of your mission to help make that a more decentralized option for crypto payments, and how a business might work with you guys to do that.
Yeah of course, getting into crypto is one thing but then you also might want to hold it for a while, but then there comes a point where you also want to spend it. Of course with our wallet we have a self-custodial web wallet that's very easy to create, in just 30 seconds you can make payments. You can walk around and pay but they're still lacking opportunities to pay with cryptocurrency, and we have our own solutions so if you're a business that wants to accept cryptocurrency, Nimiq also offers web apps where you as a shop – it's all for free – you can just use it from your browser and to accept cryptocurrencies and send payment requests instantly to your customers.
But we recently partnered up with a very interesting company called Salamantex. They're an austrian fintech startup, and they teamed up with the company that builds the traditional payment credit and debit card terminals. The company is called Ingenico. So when you're walking like, I don't know, through your city, and Ingenico runs around 30 million devices worldwide, and they teamed up with the manufacturer of those payment terminals, so that these traditional machines that you find in daily life understand crypto and accept crypto payments, so when you're waiting in line one person pays with their debit card, the other person pays with their MasterCard, and I just go can I pay with bitcoin or Nimiq, and then the cashier just presses two buttons and this traditional machine, it's nothing special, it's the typical machine that is in the store, gives you a barcode that you can then scan with your own wallet.
You just scan the code and make the payment, so they are using existing payment technology in real life that is already there and enable that existing tech to understand crypto payments, and that is something crazy… it's magical to play with it, we just went to Vienna to actually try it out and they're preparing to roll out into other countries now, and I can't wait for that to happen. That will get the broad public in touch with crypto payments, it's gonna be amazing.
So, speaking of the browser, I'm glad you mentioned that, it was something I wanted to ask about. So, it runs in the browser but on the back end security side of things, can people use a hardware wallet if they want to, does it just live in the browser or can you walk us through that piece of things.
Yeah, of course, you can connect your ledger to it so that is no problem, we have a Ledger integration. Also I think most people use a hardware wallet. We're working on integrating other hardware wallets but this is currently, to be honest, not a high priority on the roadmap. There are other very interesting solutions and I think especially the hardware wallet market is also evolving, there are new wallets coming out, and we definitely already work with Ledger, but you can also store your crypto in your web wallet. So, we are a self custodial web wallet. Your keys, your crypto. That means nobody but you have actual access to your funds. Is that answering answering your question.
That's great, and so you've mentioned the NIM token a couple of times, can you kind of walk us a little bit through what are some of the tokenomics. What kind of role does it play in the Nimiq ecosystem. Give us just a rundown on the token.
Yeah sure, so basically originally the NIM token is modeled with the supply model after bitcoin, the only difference that we made is we have 21 billion coins of total supply in around 100 years from now, and not 21 million, and the only difference why we have the 21 billion is that it might be easier to use.
You know now with bitcoin you are paying 0.0001 bitcoin and we wanted to keep less numbers before the comma. This is why we actually said we are going to make it 21 billion coins. So, to be honest I can't dive, I don't know what the maximum circulating supply currently is, but this of course all easily checkable on CoinMarketCap, but we are also working on its means of payment, so we are a payment project and it's a payment coin.
NIM is new internet money, so we want to be the digital cash equivalent to bitcoin being the digital gold. That's why all Nimiq products also support bitcoin natively, because this is the approach, bitcoin is the store of value, Nimiq is the fast easy convenient crypto cash equivalent, and we are currently working on the next version of our blockchain Nimiq 2.0.
We are moving to proof-of-stake, which will also enable our users to stake their coins. We are still proof-of-work but we are currently finishing the last open construction topics on our devnet which is the first stage of our testnet, and then we are seeking to make progress as fast as possible to actually launch our Nimiq 2.0 proof-of-stake blockchain.
We developed our very own consensus algorithm for that because we are aiming to build a single chain blockchain protocol that operates at the maximum theoretical speed and power that the blockchain protocol can deliver. This was our aim and we delivered our own consensus algorithm in order to achieve that.
So, everything we do is built from scratch by our team, and it's just a ton of work and hold some interesting challenges, but we're working ourselves through like the forest, I would say, and are making good progress on that end. So devnet is next then a hardened testnet and then hopefully proof-of-stake Nimiq 2.0 will be out as soon as possible.
So, max it's been so much fun to have you on the show and get to really dive into what you guys are building. Just to kind of wrap this conversation up, can you tell us a little bit about what's coming next for Nimiq. What the team's currently working on, or really excited about, and what people can kind of expect to see next for you guys.
Yeah, so basically we are still wrapping up a very extensive building phase, you know, we've been building the fiat to crypto atomic swap. We're still developing and finishing Nimiq 2.0. At the moment, once this is out we, in 2022,want to open up the gates and become more global.
That means we are moving out into the world with our atomic swap, we are looking to connect more countries in Central America and making good progress there. We recently also found a solution to connect OASIS, which is our special safe for fiat, currency to the US market, and are looking for a U.S. banking partner that is interested in becoming our technology partner.
So, this is on our roadmap, scaling up this fiat to crypto atomic swap into Central America, North America, other countries and the same with the payments, working together with our partners. They are preparing to roll out in other countries, they're also very active in the Dubai region. I don't know what their exact plans are but it looks like they're trying to set foot over there too, and we're trying to expand our business from local or more europe where we are currently at, into the world and of course we need much more eyeballs and developers to check out Nimiq and see how easy it is to build on our blockchain.
We are a bit in our little shell and we're opening up this shell in 2022 a lot more, to get more visibility and tell everyone what we're doing, and hopefully they like it. We have a very vivid community so everyone is more than invited to join our interesting adventure here.
Awesome, Max. It's been so much fun just to have you here on the show, and to really dive into atomic swaps and decentralized crypto payments, and all of the things that you guys are currently working on. If someone is watching this, and they want to check Nimiq out, they want to join your community, maybe learn more about you guys where's the next best place for them to go.
Definitely at twitter.com/nimiq, that would be awesome, you can find us on Telegram with our big community and youtube.com/nimiq, and of course nimiq.com, there's everything you want to know and you want to learn, and if you happen to be in Europe or if you are a U.S. bank wanting to check out our fiat crypto atomic swap check out supersimpleswap.com
Perfect, well Max thank you again so much for your time I really appreciate it.
Thank you very much for having me on the show Lea, it was a pleasure.