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eCash (XEC): a new Bitcoin fork for crypto-payments

Bitcoin was the world's first and most popular cryptocurrency, which paved the way for creating new protocols and digital assets. Dozens of forks have already been created based on Bitcoin, among which the most famous are:

What is eCash?

eCash is a renamed Bitcoin Cash ABC protocol, which became a fork of Bitcoin Cash. The eCash blockchain was released in November 2020. The critical difference between eCash, Bitcoin, and Bitcoin Cash was the protocol's Proof-of-Stake consensus mechanism.

The idea of eCash was first introduced by David Chaum in 1990 and was one of the first cryptocurrency concepts to be adopted by Bitcoin creator Satoshi Nakamoto. However, unlike Bitcoin, the eCash concept was never realized, so it was the first cryptocurrency ever launched.

The creator of eCash was the CEO of Bitmain, the most famous mining equipment manufacturer, Jihan Wu, who reportedly had a hand in creating Bitcoin Cash.

How does eCash work?

Unlike the other Bitcoin and Bitcoin Cash forks, the eCash protocol is not based on Proof-of-Work (PoW) but on a Proof-of-Stake (PoS) consensus mechanism called Avalanche. This PoS mechanism provides:

  • high network throughput,
  • lower fees,
  • higher block sizes,
  • and allows for confidential transactions.

Among other things, the Avalanche consensus is compatible with the Ethereum Virtual Machine (EVM), so developers can write smart contracts in Solidity for decentralized applications based on the eCash blockchain. Compatibility with the EVM also allows developers to issue their tokens (etokens), which work similarly to ERC-20 tokens on Ethereum. That said, eCash uses the same UTXO address accounting model as Bitcoin, not an Account model like Ethereum.

Despite the similarity in name, the eCash consensus has nothing to do with the Avalanche blockchain, and the mechanisms of these networks work differently. The Avalanche consensus on the eCash network uses four compatible mechanisms to ensure fast transaction completion:

  • Slush,
  • Snowflake,
  • Snowball,
  • Avalanche.

The developers of eCash paid particular attention to privacy: the protocol uses CashFusion technology, which combines user transactions into a single pool, similar to what happens in the Dash network. This approach makes it difficult to track funds, as transaction inputs and outputs are mixed and then redistributed, confusing the trail. However, this technology is only supported in the Electrum ABC wallet.

XEC cryptocurrency

XEC is the native cryptocurrency of the eCash protocol. XEC cryptocurrency performs the same functions in eCash as BTC does in the Bitcoin blockchain: it is used to pay commissions and rewards to miners.

XEC cryptocurrency can be used for peer-to-peer transfers and payments without intermediaries, cross-border transactions, and micropayments due to low network fees, which are unavailable in Bitcoin or Ethereum blockchains. In addition, thanks to the support for smart contracts, XEC's use cases become much broader, as holders of this cryptocurrency can take advantage of all the benefits of DeFi, including:

  • staking,
  • lending,
  • liquidity mining,
  • swaps,
  • NFT trading.

Like Bitcoin, the eCash protocol incorporates a halving mechanism that halves the rewards to validators roughly every 4 years or 210,000 blocks. eCash also uses a system of dividing the cryptocurrency into pieces called bits.

XEC's capitalization reaches $673 million. The asset is ranked 90th in CoinMarketCap's ranking by this indicator. However, at the same time, the XEC rate is only $0.000034, which may seem like a meager price at first glance.

The answer to the question "Why is the XEC cryptocurrency rate so low with such capitalization?" lies in the excessive issuance: more than 19.6 trillion XEC are circulating on the crypto market with a maximum issuance of 21 trillion — a million times more than bitcoin. Therefore, considering the issuance, the rate is not so small for this cryptocurrency.

Over the past year, the XEC rate has not grown much compared to many other well-known altcoins - only by 65%. However, since September 2023, the token has shown a steady upward trend associated with the general rise of the crypto market. Relative to the historical maximum (ATH) at $0.00059, reached in November 2021, the price of the XEC cryptocurrency has fallen by more than 94%.

To summarize

According to the project roadmap, eCash developers update the protocol twice yearly — on May 15 and November 15. In the blockchain updates, the eCash team adds new mechanisms that expand the platform's functionality.

The prospects for eCash are currently dim for at least two reasons:

  1. First, privacy-oriented cryptocurrencies are not in high demand.
  2. Second, privacy-oriented crypto assets tend to be delisted from significant exchanges. This could also be the reason for the low demand for privacy-oriented cryptocurrencies. Although XEC is traded on major exchanges such as Binance and OKX, the cryptocurrency could be removed at any time at the request of regulators.

On the other hand, the XEC cryptocurrency does not exhibit as strong a level of volatility as many other altcoins, some of which rise and fall in value dozens of times quickly. In addition, the creators of eCash aim to use XEC for payments, but this already largely depends on how much merchants and consumers will accept it.

© BestChange.com – , updated 01/14/2024
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