Ontology Coin [ONT] Decoded: Read before you buy (Beginner’s guide) 18411
Analysis
Chandna P
Jul 15, 2018 at 10:00 AM

Now, that you’ve learned about the popular digital currencies like Bitcoin, Ripple, Ethereum and Monero, are you looking to find out more about interesting and upcoming altcoins? Well, then you’ve come to the right place!

Here, in today’s post, you can find all that you need to know about Ontology – one of the most exciting and innovative altcoins out there. Did you know that unlike other cryptocurrencies, Ontology had no ICO (Initial Coin Offering)? And, the team distributed a large number of tokens for free?  Wondering what the reason behind this is?

Continue reading to find the answer as well as to know everything you need to know about Ontology (ONT) cryptocurrency. Let’s get started.

What is ONT? All you Need to Know

Ontology is a relatively new cryptocurrency and was just started in 2017. The company behind the project is OnChain, a Chinese conglomerate that has tasted massive success in the crypto-industry via its previous projects. The founders of OnChain, Da HongFei and Erik Zhang are also the founders of the NEO blockchain, that is currently a valued multi-billion-dollar project.

The mission of Ontology is to help business of all sizes and across industries leverage the potentials of the blockchain technology, without having to replace all their existing IT infrastructure. What more, the Ontology team wants to make this process super-simple, so that even businesses who have no idea about blockchain could benefit from it.

There was no ICO for Ontology Coin

What makes the journey on Ontology interesting is that there was no ICO, as is the norm in the field of digital currencies. Instead, the team airdropped tokens free of cost to a large number of people including Ontology newsletter subscribers, NEO users and plenty others. Additionally, the team also received funds in exchange for ONT from private investors.

Remember that both Ontology and NEO are run by the same parent company. Hence, both these projects have overlapping missions. They are currently work side by side to make blockchains accessible to businesses, by supporting dApps. This places Ontology as one of the direct competitors of Ethereum.

Now, that you’ve seen how the Ontology project started, let’s take a look at,

The Potential Uses of Ontology Coin

Let’s explain this with a real-world example. Every time you visit your doctor for an illness, he/she notes your symptoms, makes the diagnosis, and records the treatment plan and prescription. All this form a part of your medical records held at your doctor’s clinic.

What happens if you move to another city or even country? The new doctor you consult will not have access to your previous medical records. The new clinic must send in a request to your old doctor requesting permission to access your medical history.

Why is this process convoluted? And, why the lengthy time for permissions?

There are two primary reasons behind this. One, data protection laws mean that your personal data is not available for sharing with any random person who requests for it. Second, each organization has their own systems, which makes it difficult to share data across networks and systems. Meaning, the compatibility of data between one organization and another is poor.

This is what Ontology aims to address.

Let’s use the same example as illustrated to look at the benefits of the Ontology project. When using the Ontology network, your medical record will be placed on the blockchain of this network. This in turn can connect with other blockchains like NEO. Even though all individual organizations have their own supply chain/network, they all can be linked to a blockchain. What more, each organization can decide what information they want to share on the blockchain.

For instance, all major hospitals may have access to the entirety of your medical records, while a pharmacy may have access only to the necessary information like verifying your identity. This is termed as “Permissioned Access” in the world of blockchains.

Ethereum Vs Ontology – The Major Differences

Ethereum was also started with the aim of providing the potentials of the blockchain technology to businesses. But, unlike Ontology, any information posted on the Ethereum blockchain is available for all to see and the blockchain itself is open-sourced.

This isn’t an ideal situation for businesses that want to keep their data private. This is what Ontology addresses.

As explained above, individual businesses have the right to decide the permission levels for data shared on the blockchain. A single data may be accessible to one organization, while others may not have access to it.

Ontology Coin (ONT) A Bright Star in the Crypto World

Ok, now that you’ve got the basic idea of what Ontology proposes to do, let’s take a closer look at the coin, or rather the coins in the network. Ontology network will have two different digital currencies.

The principal coin is called the Ontology coin or ONT in short. The total number of ONT coins is 1 billion and no further coins can be created once this number is reached. The ONT is a NEP-5 token, which is backward compatible with the NEO blockchain.

Once the Ontology Main Net is launched, the ONT coin will be replaced with a new token called Ontology Gas (ONG). This will make the Ontology platform a dual-currency network. The ONG Gas will work in the same way as NEO’s GAS. It will help users to earn transaction fees for their work on the blockchain.

How do Transactions work on the Ontology Network?

Remember that the aim of Ontology is not to operate as a single blockchain. Instead, the technology will help businesses to use the platform as both a public and private blockchain. Let’s look at how it works.

Any business or company will not be ready to place all its data on a public blockchain. Instead, they can choose to use the private Ontology blockchain which is accessible only by the business and any other parties with whom they share the permission.

However, they can choose to keep certain parts of the information accessible to all using the public Ontology blockchain. Thus, Ontology acts a bridge connecting the real world with the digital world, in a trust-less environment.

But, how can businesses be sure that the information on the Ontology platform can be trusted. Just like all other digital currencies, Ontology uses a consensus mechanism.

Ontology Launches VBFT – a Next-Generation Consensus Mechanism

There are several different consensus mechanisms which are used by various cryptocurrencies. Some of the popular ones include PoW (Proof-of-Work) and PoS (Proof of Stake).

The consensus mechanism used by Ontology is termed as VBFT and combines three other consensus models including PoS (Proof-of-Stake), VRF (Variable Random Function) and BFT (Byzantine Fault Tolerant).

The PoW used by Bitcoin can verify up to 7 transactions every second, where PoS used by Ethereum can verify nearly 15 transactions per second. The VBFT of Ontology can verify 1000s of transactions every second.

Additionally, for PoW over 50% of all nodes on the network must reach an agreement before a transaction can be verified. On the other hand, for VBFT, the transaction requires only 2/3 of nodes to agree, this makes it possible to have faster and cheaper transactions.

How to Buy Ontology (ONT) Coin?

It can be purchased using any one of the following two methods:

  1. At Crypto Exchanges – You can trade BTC, ETH and other digital currencies for ONT coins at popular crypto exchanges like Binance, OKEx, KuCoin and several others.
  2. From Crypto Brokers – These are similar to the crypto exchanges but function independently. When you use brokers, you have to pay brokerage fees. Some of the popular choices include Coinmama.

How to Store Ontology (ONT) Coin?

The two most popular Ontology compatible wallets include NEO CLI and Ledger S. NEO CLI is a desktop-based wallet that can be run on all operating systems. Ledger S is a hardware wallet, that is just the size of a human finger.

Pros and Cons of Ontology Network

Let’s take a look at the advantages and disadvantages of the Ontology network.

Pros:

  • User-friendly and easy entry for businesses – The Ontology network will make it easy for companies across domains to leverage the potentials of blockchain technology, as there is no need for prior knowledge about this technology.
  • Strong Team – OnChain, the parent company behind Ontology has had several successes in the crypto industry, notable of which is the NEO project.
  • Broad Applications – Ontology can be used for a wide array of real-world applications.
  • Unique Consensus – The consensus method of Ontology is unique and promises to overcome the challenges faced by older consensus models.
  • Connects the virtual economy with the real world – Ontology serves as a bridge connecting the real-world with the crypto space in a seamless manner.

Cons:

  • Restricted to China – Right now, Ontology operates from one of the nations in the world known for its strict trade regulations, the people’s republic of China.
  • Still early – The project is still in its nascent stage and has been operational for just one year.

Final Thoughts on Ontology

Ontology presents a unique proposition in the crypto world. The project aims to address some of the biggest challenges in the industry. But, with that said, it’s still in its early stages and it’s difficult to predict how it will shape up in the future.

Image via Shutterstock

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