In the face of a price adjustment affecting most of the top 100 cryptocurrencies, Nervos Network and its token CKB have bucked the trend, experiencing notable growth and moving up to the 79th position in the market. The rise of Nervos Network has left some pondering what might be driving its impressive surge.
Nervos Network Decoded
The Nervos Network is a blockchain platform functioning at Layer 1, utilizing proof-of-work consensus, specifically engineered to enhance the performance of application-focused Layer 2 chains. The objective is to make its native token, CKB, a more eco-friendly alternative to Bitcoin (BTC) as a store of value and offer a more robust smart contract system compared to Ethereum (ETH).
The finite number of Bitcoins and the reduction in rewards given to minters for each new block created may lead to questions about the future motivation for miners to continue their activities.
The Nervos Network addresses this problem by implementing an annual release of a set number of CKBs for secondary issuance, along with a stable base supply, which creates lasting motivations for miners.
Nervos Network tackles a security concern with Ethereum. In Ethereum, the worth of its own token, ETH, doesn’t directly correlate to the value of applications developed atop Layer 2.
Nervos Network intends to lessen the risk by making CKB responsible for transaction fees and data storage. This strengthens the economic bond between the native asset and the network as a whole.
How Secondary Issuance And State Rent Drive Sustainability
Nervos employs a continuous secondary issuance method to enhance the state-of-value (SoV) attributes of CKB. Through this approach, users are motivated to keep securing CKB based on the scale of their projects.
In addition, Chained Key-Base (CKB) units that are locked have an automatic payment of “state rent” through inflation. This process maintains a financially sound economy.
The Nervos Network presents an alternative marketplace for chain space where apps can offload and trade Confirmation Deposits (CKBs) without the need to manage their own storage.
Investors can protect themselves against inflation by buying and depositing CKBs into NervosDAO. This platform, similar to treasury bonds, uses a portion of the new tokens generated during secondary issuances to counteract inflation. This setup presents an intriguing investment possibility.
Approaching ATH Amidst Bitcoin Integration Announcement
After thoroughly examining the basics, CKB has lately seen a substantial increase in worth, shattering a nearly two-year-long period of little change.
The cryptocurrency’s price fluctuated between $0.0024 and $0.0035 from January 30th onwards, but it surpassed this range and experienced noticeable growth in the following months.
At its current price of $0.032, CKB is just a penny shy of reaching its peak value of $0.043, which it achieved back in March 2021. Over the past fortnight, this token has experienced substantial growth with jumps of 47%, 69%, and 75% within the last fourteen days, seven days, and previous 24 hours respectively.
Based on information from CoinGecko, the trading volume for CKB has experienced a substantial growth, amounting to $207 million in the past 24 hours – marking a 9.7% rise compared to the previous day’s trading figure.
Furthermore, the market value of CKB has grown substantially, nearly reaching the double of its initial value of around $740 million on April 2, now being roughly $1.35 billion within a week’s time.
The sharp increase in price can be explained by the news that Nervos Network’s CKB token is set to integrate with Bitcoin. This upcoming addition brings smart contract capabilities to the token, as well as interoperability and modularity features slated for 2024. Investors are buzzing with anticipation as a result.
With Bitcoin getting closer to its historical Halving event, known for boosting its value, Nervos Network stands to gain significantly due to its close connections to the leading cryptocurrency in the marketplace.
The relentless upward trend of Bitcoin (BTC) and forecasted price surge could potentially push the value of CKB to new record heights in the near future.
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2024-04-13 03:40