Symbol

Symbol (XYM) is a blockchain protocol that was officially launched on March 17, 2021, by the original core team behind NEM, known for its proof-of-importance algorithm. Initially, Symbol was intended to be an upgraded version of NEM, but in 2019, the NEM community voted to make it a separate chain. In 2021, another vote led to the decision to merge the two chains, resulting in the concept of Symbol 2.0.

NEM Group, founded in Singapore in 2014, was the precursor to the development of Symbol. The team behind NEM aimed to create a more advanced blockchain solution, which eventually became Symbol. The project was designed to address issues with EVM-based platforms and provide a more secure, high-performance, and layered-architecture blockchain protocol.

During the launch, NEM N1S1 users received one XYM coin for every XEM coin they held, kickstarting the Symbol economy. This 1-to-1 conversion program helped distribute approximately 7.3 billion XYM coins, with an additional 1.7 billion XYM to be created as block rewards over the next hundred years, reaching a fixed total supply of about 9 billion XYM coins.

Symbol is characterized by its novel consensus algorithm called Proof-of-Stake Plus (PoS+), which rewards users of the chain based on their importance score, factoring in transaction activity and current stake. This algorithm incentivizes node owners to maintain the blockchain and rewards them with XYM tokens.

Symbol (XYM) is a blockchain platform designed to improve interoperability and collaboration with other blockchains. It uses a proof of stake (PoS) consensus mechanism, which is more energy-efficient compared to traditional proof of work (PoW) systems. Here's a detailed overview of how Symbol works:

Symbol employs a four-tiered architecture to provide a streamlined experience for businesses and users. This architecture includes layers specifically designed for handling decentralized application (DApp) processing and smart contract execution. This dual-layered approach enhances scalability by reducing congestion on the primary layer, which serves as a digital ledger.

The XYM token is a critical component of Symbol's strategy. It serves multiple roles, including incentivizing nodes, rewarding stakers, paying fees, and facilitating transactions on the network. XYM provides fast transaction times and can be sent globally in a permissionless manner.

Symbol uses a unique consensus algorithm called Proof-of-Stake Plus (PoS+). Unlike basic PoS, where block creation is based solely on a node owner's stake, PoS+ incorporates additional factors to promote a healthier ecosystem and more active participation. Three crucial elements determine an account's importance for harvesting blocks: stake, transactions, and nodes. The stake considers the total amount of harvesting mosaic (XYM tokens) held, requiring a minimum of 10,000 mosaics for eligibility.

In Symbol, block creation is referred to as "harvesting." Node operators are pivotal in maintaining the network's decentralization. They earn rewards from transaction fees, inflationary rewards, and a share of delegated harvesting rewards. An account needs at least 10,000 harvesting mosaics and a valid VrfKeyLinkTransaction for eligibility. Harvesting rewards are partially allocated to a network fee sink account and can be shared with a beneficiary account, set by node operators, to incentivize node supporters.

Symbol's maximum supply is capped at 8,999,999,999 units, with 5,836,724,397 (64.85%) already in circulation. The initial supply was 7,842,928,625 XYM, allocated based on users' XEM holdings at a specific snapshot. An additional 1,157,071,374 XYM is earmarked for inflationary rewards over the next 100 years, following a rate similar to Bitcoin's inflation. This fixed maximum supply underpins the network's stability and value.

Symbol supports various features that make it a robust and versatile blockchain platform. These include:

• NFT Support: Symbol allows for the issuance, management, and use of non-fungible tokens (NFTs), which can represent anything from digital art to car titles.
• Smart Contracts: Symbol offers advanced smart contract programmability, enabling businesses to create specialized digital assets to meet their community's needs.
• Tokenization: Symbol enables firms to tokenize and create digital assets such as stocks, signatures, votes, debt, and more, removing technical barriers from blockchain integration.
• Enterprise-Grade: Symbol is designed to support complex enterprise use cases, including asset management and data integrity, with features like aggregated transactions and multi-level multisig accounts.

Overall, Symbol (XYM) is a blockchain platform that combines high-performance capabilities with advanced smart contract programmability and a robust consensus mechanism, making it suitable for a wide range of applications, from individual developers to large-scale enterprises.

Symbol (XYM) has several strengths that make it a robust and versatile blockchain platform. Some of its key advantages include:

• Ease of Use: Symbol is designed to speed up development and onboarding time. It offers a flexible plug-in approach, allowing users to create custom assets and tokens quickly and easily.
• Security: Symbol uses a contract plug-in framework, which makes it more resilient to human error and network attacks. This framework also streamlines the security testing process.
• High-Performance Blockchain: Symbol combines a high-performance blockchain with advanced smart contract programmability, making it suitable for enterprise use cases.
• NFT Support: Symbol supports the issuance, management, and use of non-fungible tokens (NFTs), which can represent various digital assets.
• Tokenization: Symbol enables firms to tokenize and create specialized digital assets to meet the needs of their communities, removing technical barriers from blockchain integration.
• Scalability: Symbol's four-tiered architecture provides more scalability by reducing congestion on the primary layer, which is used as a digital ledger.
• Incentivization: The XYM token is used to incentivize nodes, providing rewards for stakers and facilitating fast transaction times.
• Business Solutions: Symbol is focused on providing business solutions, offering features like smart contracts and enhanced security to optimize operations and explore new innovative pathways for development and growth.

These strengths collectively contribute to Symbol's strong positioning in the blockchain space, appealing to a broad spectrum of users from individual developers to large-scale enterprises.

Symbol (XYM) carries several risks that investors should be aware of:

1. High Risk Investment: Symbol is currently considered a high-risk investment, which means that traders focused on risk assessment should exercise caution when investing in XYM.

2. Technical Barriers to Adoption: While Symbol is designed to streamline integration into existing enterprise systems, technical barriers can still hinder its adoption. The network provides developer tools, including secure APIs, to facilitate integration, but these tools may not be sufficient to overcome all technical challenges.

3. Liquidity Constraints: Symbol aims to alleviate liquidity restraints by creating new markets and enabling tokenization. However, liquidity issues can still arise due to asset characteristics or regulatory requirements, which may impact the smooth operation of these markets.

4. Security Risks: As a blockchain platform, Symbol is vulnerable to cyber attacks. The platform provides tools to mitigate these risks, but they are not foolproof. Developers must ensure that their solutions are secure and robust to prevent potential vulnerabilities.

5. Existential Risks: Symbol, like other blockchain platforms, is not immune to existential risks. These risks, including s-risks, can have a significant impact on the platform's long-term viability and the broader blockchain ecosystem.

6. Regulatory Uncertainty: Symbol operates in a regulatory environment that is still evolving. Changes in regulations or laws governing blockchain technology and cryptocurrencies can negatively impact the platform's operations and value.

7. Competition: The blockchain space is highly competitive, and Symbol faces competition from other platforms. If Symbol fails to innovate and adapt to changing market conditions, it may struggle to maintain its market share.

8. Inflationary Risks: Symbol's inflationary rewards system, similar to Bitcoin's, can lead to inflationary pressures if not managed effectively. This could impact the value of XYM over time.

Investors should carefully consider these risks before investing in Symbol (XYM).

• NEM Group: The team behind the New Economy Movement blockchain, which launched Symbol as a proof-of-stake, enterprise-facing blockchain platform.