Neucoin releases White Paper - discuss

Hi Guys,

Neucoin has just released their White Paper, would be interested to go through it together and discuss. There is always something to learn. Maybe we can compare advantages and drawbacks from their model.

Just had a glimpse over it. From technical perspective NeuCoin seems like an amalgamation of BlackCoin and PeerCoin, nothing new really. That doesn’t mean they don’t have a good marketing team and lots of clout with content providers.

It scares me a little how many coins they’re holding internally and with angel investors. They claim they’ll have limits to how they can cash out, but is there anything at the blockchain level code to enforce this? If public supply is scarce & drives the price up I’d be afraid of a huge dump to follow.

On the other hand, they will offer online wallets, MyNeuCoin, with easy way to buy gift cards. Their strength is not tech, but consumer utility.

Sebsebzen We should get m3ndi3’s opinion. =P

$2.25 million surely helps with developing consumer utility and marketing. I hope that Reddcoin can raise venture capital as well. The tide is shifting as big players are getting ready to enter the crypto scene.

As a result, NeuCoin’s design solves both the mounting cost and centralization problems of
proof-of-work, and the security and centralization problems with earlier proof-of-stake coins.
As such, NeuCoin is the first peer-to-peer cryptocurrency, regardless of technology, that is
secure, cost-efficient and decentralized in the long run



Does this really belong here?

I’m on page 34, so a couple pages to go. I certainly plan on replying to it, though whether I will do so publicly on their forum or privately via email has yet to be decided.

I do think it’s worth discussing here so much as folks want to talk about the technicals, but I’d like to get a bit more time with the paper first.

For now, I’ll say that they are basically using Blackcoin’s PoS 2.0, though they only acknowledge a portion of this fact, and they “solve” potential issues with PoS by either (1) saying Peercoin fixed them, (2) saying Blackcoin fixed them, or (3) using half-proofs to hand-wave away the rest of the issues. Their solution to make sure people continuously stake is partially undermined by their own whitepaper, and while interesting and worth discussing, is not nearly as useful as PoSV’s solution.

More later.


bigreddmachine My opinion is that you should do it public, so everyone can see whats going on. so non-tech people also can see whats going on, as many properly doesn’t understand whats in the whitepaper.


I just want to emphasize that it is crucial for Reddcoin’s success to understanding and analyze what competitors are planning. This forum turning into an echo chamber is a far bigger threat.


Sebsebzen said:

I just want to emphasize that it is crucial for Reddcoin’s success to understanding and analyze what competitors are planning. This forum turning into an echo chamber is a far bigger threat.

Hear hear!

I’ll post more of my thoughts before I go to sleep tonight. Would love to hear your opinion in the mean time.

That was more in reply to Convertor

My analysis may be a bit unorthodox, but I’d suggest Laudney to do another pitch to angel investors. Tipping with html tags, PoS 2.0, and last but not least monetization with social broadcast. That’s worth potentially hundred of millions.

I find this part interesting:

One severe weakness of Peercoin is that it suffers from extremely low mining participation,
with typically less than 10% of the currency supply staked at any one time. This means that
an attack requiring control of 51% of the staked coins only requires control of 5.1% of the
total currency supply. There are several factors that contribute to the low mining rates in
Peercoin, but the principal one is miniscule rewards for mining: just a 1% annual return.

In contrast, NeuCoin provides very high compensation to miners, especially during the
early years following its launch. Specifically, NeuCoin’s coinstake rewards begin at a 100%
annual rate and decline in a linear fashion over ten years after which they reach a 6% annual
rate, where they remain indefinitely. These high reward rates will incentivize a large number of
miners to stake a large number of coins.

Some observers might consider NeuCoin’s high reward rates to cause unacceptably high
inflation. In fact, NeuCoin utilizes high inflation deliberately in its early years to compensate
users for holding and staking the currency while its value, utility and security are lowest and
its risk is highest.

So they try to secure the network by offering very high rewards for the first years to attract users. I’m curious how this works out.
After ten years it’s just another blackcoin in terms of functionality.
To be fair. The min stake age is a little bit higher than blackcoin (38h vs. 8h) and some other constants of the mining equation have changed. coin age is removed from the probability equation.

Low transaction fees and fast block confirmation make this coin suitable for instant micro transactions (like blackcoin, reddcoin and so many others) but there is no word about a decentralized platform for tipping or payment.

Please correct me if I’m wrong.

Sebsebzen, ReddcoinRocks, Convertor, and anyone else that I missed:

I’ve posted my response on the NeuCoin forums. You can find it here:

I’ve done a pretty lengthy review and commented throughout the paper, though to see all of my comments you will need to download the PDF that I link to on that forum. If you are interested instead in a summary, I have posted that there directly.

– Mike


Nice read BRM, very balanced critique

bigreddmachine Thanks that you took the time to write such a broad and balanced review. Your comments in the PDF are a very interesting read.

bigreddmachine said:

I believe that to some extent, we’re all in this together, and I hope that collaboration among communities and development teams will enable future success for all cryptocurrencies.

I think it’s the first time I have seen such a comment from a member of a coin’s dev team. :slight_smile: