NXTcoin is one of many Bitcoin descendants out there. However, there is a big difference between it and most cryptocurrencies. This is involves NXTcoin mining.
When mining cryptocurrencies, people buy mining equipment and need to sharpen their hardware knowledge. It also requires hours of dedicated work and patience to mine cryptocurrencies. This is because a lot of them use a Proof of Work protocol for determining who gets to process blocks. There is a lively competition on who gets rewarded.
However, some cryptocoins use a Proof of Stake method. In this way, coins are mined by staking coins that people already own. The more that people stake, the more people make. It is like earning interest. This consensus protocol has many benefits to it, one of them being energy efficiency. This is what NXTcoin uses to process its blocks.
What you need to know about NXTcoin mining
There is something different when it comes to NXTcoin mining. This is because NXTcoin is fully pre-mined. This means that there are already 1,000,000,000 NXT. A lot of people might ask how exactly people are supposed to mine NXTcoin.
The truth is they should not. NXTcoin relies on the transaction fees spent on the NXTcoin platform to reward the miners. The minimum fee for any NXTcoin transaction is 1 NXT. This process is called “forging” NXTcoin. The original pre-miners set distribute their NXTcoin into the market by rewarding those who help in processing the blocks. This is why it is called forging and not mining.
The process is actually automatic. Twenty-four hours after receiving your first coins, your NXTcoin wallet software will begin to contribute to the block generation process. You can earn coins for you as long as your account is “unlocked.” Here’s a basic guide to get started.
The process of NXTCoin forging
The first step is that you’ll need an NXT wallet. Download the latest NXT software and install it. Once installed, open the NXT Server and create a new account. It will generate a seed that can be used as a backup to restore your account or to use it somewhere else. Keep this seed safe. This can help retrieve your account when something bad happens.
Now you need to start funding your account. Proof-of-stake needs a seed for you to start forging. Get your wallet address and go to the nearest exchange that sells NXTcoin. There are three requirements to stake NXT. First, you must have at least 1,000 NXT, which means you need to buy some. Next, 1,400 blocks from your initial deposit need to have passed. Finally, you must have public key. Creating a public address is easy. Just send an outgoing transaction and you will get a public key and after that, just wait for 24 hours and you can start the NXTcoin forging—or NXTcoin mining as it can be loosely called—with a click on the start forging button.