Created in 2014. Launched in 2015.
Created by a non-profit organization founded in Singapore.
A block can contain up to 120 transactions. Maximum block size is not defined.
NEM uses the term harvesting.
Open source project available on github.
Smart Asset System.
Powerful API interface that can be used with many programming languages.
NEM offers public or private blockchains to customers.
NEM transaction might be 100% transparent.
EigenTrust++ algorithm is used for peer-to-peer communication.
Embedded messaging and escrow services.
The New Economy Movement ecosystem attracts a lot of people for many reasons. The most significant one is surely the newly introduced consensus mechanism called proof of importance (POI), which I cover later on in this article. Besides that the code-base was designed and developed from scratch (no fork of other existing project). And last but not least the idea itself is solid and innovative in many aspects.
NEM is a peer-to-peer, scalable, blockchain platform ready for small and enterprise businesses. NEM aims to penetrate into the banking sector, which requires mainly transparency and transaction verification. For this reason the NEM blockchain is public. However NEM offers also a private blockchain to satisfy all customer needs.
NEM is regarded as a green friendly technology since it uses 100 times less electricity than Bitcoin for network operations. That is made possible by the usage of POI consensus mechanism, which is not so energy demanding as POW or POS.
It is worth mentioning the Catapult project. Within the project the core code-base was rewritten from Java (the first generation) to C++ (the second generation) and and the Mijin (NEM’s permissioned) ledger was completely overhauled to give a superior performance. It significantly increased NEM‘s performance and made it ready for the financial sector. Thus NEM can be considered as a competitor to Ripple. For more details check the Catapult white paper.
NEM is able to handle 3.000+ (peak 4000) transactions per second. Transactions are visible within 6 seconds in a wallet/NEM client. Confirmation comes within 20 seconds. Transaction fee is 0.1% of the transaction amount.
NEM allows customers to build arbitrary asset systems. Customers define how the NEM blockchain will look like, what it will be doing and how it is going to be used. The potential is huge as it can be utilized in fintech, logistics, exchange, ICO, document storage and notarization, decentralized authentication, military, medical and many other businesses.
To build an asset a customer must define a namespace (and possibly subdomains), which is in fact the home address in a NEM blockchain. Next step is a definition of arbitrary mosaics in a given namespace. Mosaics are NEM‘s sub assets. The creation of sub assets requires the rental of a root namespace. A customized mosaic is a basic building block of smart assets that can represent anything. For example a coin, signature, document, status or any other thing. An asset can be updated by a NEM transaction, which is not always the case in similar competitor projects.
Moreover NEM allows the creation of addresses acting as containers for mosaics that can be connected with multiple rules. Address can represent a user as a NEM account holder.
In addition, assets can be transferred as an attachment via the NEM embedded messaging system.
This is what makes NEM unique in the cryptocurrency world. NEM invented the revolutionary consensus mechanism called proof of importance (POI). As POW and POS are considered unfair and energy wasting, the POI introduced a new way of block selection. Instead of the term mining, well-known in crypto world, the word harvesting is used in NEM. Every user can participate in "harvesting" when he fulfills the required conditions and thus gains so-called importance.
NEM does not have a whitepaper, however it has a technical reference which represents both the whitepaper and the technical overview. it is a circa 55-page document with relevant information. Topics as accounts, addresses, used cryptography, transactions and blockchain, POI and networks are discussed. I advise you to also read the Catapult white paper.
XEM is a coin in NEM. It is a deflationary coin with maximum supply of 8,999,999,999. XEM came into existence when 1,500 stakeholders each received 5,999,999 XEM. Then they distributed, said coins, to the community. Other funds were distributed to multi-sig wallets with the intention of distribution for NEMs development and rewards. XEM can be bought on exchanges (available at all major players) or be harvested.
In NEM there are two kinds of users. Either with importance or without it. By default the user does not have the importance. In order to be eligible for importance calculation, the user needs to have at least 10.000 XEM in their balance. The importance is then calculated based on two factors. Firstly XEM amount is taken into account. Secondly a number of transactions within the last month is considered. So not only account balance is crucial by the importance calculation, but also the amount of transactions. It ensures fairness.
Harvesting is the process of generating blocks and earning the transaction fees in that block as a reward. POI determines who generates a new block. To be able to harvest, the account needs to have importance. If that is the case, then every 1440 blocks 1/10th of the unvested balance is moved to the vested part. Note that harvesting does not create new XEM coins. Harvesting revenue is approximately 1% per year (depends on the amount of transactions). Also read the paragraph related to the wallet to understand the difference between local and delegated harvesting.
When the account achieves the importance, then it can become a super-node. There are 2 advantages of being a super-node. Besides the possibility of harvesting, a super-node can take part in voting and thus influence the further development.
Note that the POI and the harvesting explanation is simplified. To fully understand how POI works I advise you to read the NEM tech reference.
NEM in real business
NEM established a partnership with the Malaysian Digital Economy Corporation (MDEC). MDEC is the leading agency responsible for introducing digital economy in Malaysia. The NEM blockchain was launched in Kuala Lumpur to support innovation and mass adoption of digitalization.
NEM is used as a backend and asset system (tokens, smart signing contracts etc.) for Comsa. Comsa is an ICO solution platform. It enables an easy way for companies to create ICO.
The NEM blockchain is used in Mijin. Mijin is a successful commercial blockchain used by financial institutions and private companies in Japan.
The NEM team is formed mainly out of Japanese developers. There is about 15+ developers working on NEM. Judging by the pull requests on github it seems the project is live. The development team can be reached via Telegram. Beside that there is the NEM forum, dedicated to development on the NEM platform. The development team is not mentioned on the official pages.
The NEM.io Foundation stands behind NEM. The foundation’s purpose is to introduce, educate and promote the NEM blockchain technology internationally. It claims the official web. There is no mention of any funding. However a list of the founding board, council and founding members is available including names and positions.
On the Investor page there is only technical material and no mention about investors.
NEM has a really huge potential and it is already used in real business. It has stepped in the financial and ICO business already. Competitors of NEM are FACTOM, Ripple and DASH (similar node systems for governance). NEM is worth to keep an eye on.
It might be surprising that NEM does not have a road map. There is no mention on the official web site. There are some NEM road maps available for example on NEM‘s facebook, but it is not up to date. It looks more like a timeline and it covers only the years 2014 and 2015. It might be a case that Catapult‘s white paper and other technical documents are considered a road map.
I think the last paragraph is a bit misleading - it is the delegated private key not the actual private key - For delegated harvesting remote NIS needs to have the delegated private keys of the account.