Frequently Asked QuestionsEdit
Myths and misconceptionsEdit
Nxt is not a scam but all Nxt coins are pre-minedEdit
The term "pre-mined" is a misnomer. Nxt coins are not mined at all. The original stakeholders in Nxt contributed Bitcoin in order to seed the creation of the 1 billion coins represented in the genesis block, and these coins were distributed among the original stakeholders. The stakeholders are expected to distribute coins by donating them, using them as "bounties" to pay for work on the coin (software, documentation, translations, support, etc.) that is done by the community. Even the creator of Nxt (BCNxt ) made an investment. The coins were not generated from nothing!
The creation of the genesis block was fully public: https://bitcointalk.org/index.php?topic=303898.msg3652710#msg3652710
If there are no new Nxt to be mined, how do you validate the blockchain and secure the network?Edit
Nxt is a pure Proof-of-Stake (PoS) currency. Users validate the blockchain and secure the network by running a light weight client on any computing device (even one that used to run Windows XP). For doing this users are rewarded with Nxt coin that is collected from transaction fees.
In addition, the "transparent mining" feature of Nxt will penalize accounts that do not participate in the mining process by temporarily preventing them from earning transaction fees.
Why is the software so hard to install and use?Edit
Hopefully the installation instructions can help you get your Nxt software running, but we recognize that the software and installation is not as easy-to-use as it will be. As of the time of this writing, the development team is working on the core features of the currency, and the currency has not yet officially been launched (this will happen on January 3, 2014).
The Nxt community has been creating some more user-friendly options for installing Nxt, and you may want to try these:
Why isn't Nxt open-source?Edit
It IS open source. When Nxt was initially launched it was developed in private to mitigate against attacks. The code is public now and is hosted on BitBucket -
Wallet, accounts, and account balancesEdit
Where is my wallet?Edit
Unlike Bitcoin or other altcoins, there is no wallet with Nxt. More specifically, the coin uses a "brain wallet", which is to say that wallets are decentralized and kept on the network. When you create an account in Nxt, your secret passphrase is used to create your account number. Once your account number is generated, you can unlock it and access it by using your passphrase on any running Nxt node.
Can I access my wallet from another computer?Edit
Yes! There is no wallet file in Nxt because all of the accounts are stored on the network. This is referred to as a "brain wallet". This means your account can be accessed from anywhere... but it also emphasizes the importance of using a strong passphrase, since the passphrase is the only thing that protects your coins from being accessed by others. (This authorization mechanism might be rewritten / updated / strengthened later)
How do I get my first Nxt coin?Edit
There are a number of ways for you to get your first Nxt coin!
- Ask for donations! As these are early days for Nxt, stakeholders are more than happy to donate small amounts of coin to help seed interest. Try posting your account information on this forum topic .
- Contribute to the community! A great deal of work needs to be done to help the Nxt community grow -- everything from contributing documentation, to promoting Nxt, to assisting with translations, to contributing code, and more. Take a look at this list of Nxt forum bounties or this list of Bitcointalk.org bounties to see what "tasks" need to be performed. Take one on, and earn some coin for your work.
- Purchase some Nxt coin on DGEX.com , using Bitcoin.
- You can get free Nxt from Nxt faucets like freenxt.org or nxtra.org/faucet/
- Pick up some coin by trading directly with members of the community in the Nxt Buying / Selling Thread. If you buy coins from someone directly, make sure you trust them, and try to break the amount in smaller groups! (Example: Trade 200 000 NXT for 1 BTC by breaking it down to 20 000 NXT/0.1 BTC packages)
Where can I buy Nxt coin?Edit
You can exchange Bitcoin for Nxt at DGEX.com . Eventually the Nxt software will implement its own decentralized exchange.
I'm worried about account security. Since all of the accounts are stored on the network, isn't it possible for someone to guess my "secret phrase" and get easy access to my coins?Edit
This question actually emphasizes the importance using a strong, secure password to create your Nxt account. In fact, we prefer the term "passphrase" because a "phrase" is generally much longer than a "word".
If you enter a passphrase less than 30 characters long in the Nxt client, you will be warned that you are creating a security risk. A truly random string of 50 to 60 characters is a far better choice for a passphrase, and will significantly reduce the risk of someone "brute-forcing" your account or stumbling across it or happening to use exactly the same passphrase. Nxt supports 10^77 different account numbers (that's 100 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 000 accounts), so the range of possible passphrases is significant.
You can use a site like https://howsecureismypassword.net/ to test the strength of your passphrase, and get an estimate of how long it would take a standard computer to crack it.
I've just realized I should have chosen a better password/passphrase. Can I change it?Edit
You cannot change your account passphrase in Nxt, because it is actually used to generate your account number. More accurately, for those of you who know a bit about public-key cryptography: your passphrase is the private key for your account, and your account number is your public key.
If you would like to use a different passphrase, just create a new Nxt account using whatever passphrase you'd like. Once you've done that, use your Nxt client to send your Nxt coins to yourself – from your old account number to your new one. The transaction fee can be set to 1 coin, so it won't cost you much to make the change.
Why is it called forging instead of mining?Edit
With Bitcoin and many other cryptocurrencies, the act of securing and verifying the blockchain results in new coins being created. With Nxt, however, all possible coins already exist, and accounts earn coins from transaction fees alone. As a result, it was felt that a new word - "forge" - was needed to describe the manner in which coins are earned.
How does forging work?Edit
With Nxt, coins can be earned through transaction fees. 24 hours after receiving your first coins, your Nxt software will begin to contribute to the block generation process and can earn coins for you as long as your account is "unlocked". The amount of coin you can earn is dependent upon the number of coins you hold, the total number of coins "active" on the network, and the transaction fees included in blocks on the blockchain.
Why do I have to buy Nxt coins in order to forge them?Edit
If you´d like to own some Bitcoin, or any of the other altcoins, you have to invest in mining hardware to be able to mine some coins. With Nxt, you buy an actual amount of coins in order to start forging. There are no additional costs, and no expensive mining hardware is needed.
I have some coins in my account. How can I start processing transactions and forging coins?Edit
If you are running the Nxt software on your computer, have your Nxt account unlocked, and some Nxt in your account, you will automatically begin forging Nxt! Officially, you can start processing transactions and forging Nxt once the first transaction that puts Nxt into your account is confirmed 1440 times. This usually takes a day (blocks are generated once per minute, so 1440 blocks are generated every 24 hours). Once you have reached this milestone, the client user interface will show you a "timer" in the "blocks" widget that estimates how long it will be before you generate a block.
The longer your account has gone without generating a block, the higher the chance will be that you will generate one.
Do I have to leave the client open in order to forge coins?Edit
No. Once your server is running, simply leave your account "unlocked", and then you can close your web browser.
What does it mean to "leave my account unlocked"?Edit
When you type your secret passphrase into the Nxt client window, your account will be "unlocked" in your software. Once it is unlocked, it will stay unlocked until you specifically lock it again, or until you stop your server.
To unlock your account, access your server by opening http://127.0.0.1:7874/, clicking the padlock icon in the upper left-hand corner of the browser window, and entering your secret passphrase. Once this is done, the padlock icon will change to the "unlocked" state and your account number and balance will be displayed in green text at the top of the browser window. At this point, you can close your web browser and your account will remain unlocked on the server.
How can I see if my account has forged a block?Edit
An easy way to see how many blocks you've forged (and exactly how much Nxt you've earned from forging) is to use the Nxt blockchain explorer :
- Go to http://126.96.36.199/nxt/nxt.cgi?action=1
- In the text box on the right hand side, labeled "block or transacation or account", enter your account number and then clock the "GO" button.
- Near the top of the query result, you will see a line containing the information you want: "Mining ratio", "Blocks generated", and "Fee earned".
How much Nxt can I earn by forging, and how often will I get it?Edit
You can start processing transactions and earning Nxt after the first amount in your account is confirmed 1440 times (or 24 hours). Once 24 hours has passed, an estimate of the time before your software will forge a block will be shown at the top of the "Blocks" widget.
Here is a mathematical walkthrough of how Nxt coins can be earned from transactions:
- Every 24 hours, there should be 1440 blocks added to the chain. These blocks represent transactions for the total volume of coins (1 billion)
- If all of these coins were used for active mining, then an account balance of 694,444 NXT (1 billion divided by 1440) would mine 1 block per day. However:
- coins moved to a brand new account must wait for 1440 blocks to mature
- some owners don't bother with mining, don't leave their Nxt software running, or their Nxt software crashes, so only portion of all coins are actively mining at any point in time.
- If you look at the "recent blocks widget" in the Nx software you will see a red-white target icon in each block. If you divide 100% by the target value you'll get the portion of coins that was used for mining that block. (Note: Because blocks are generated once per minute, you should take an average value of these targets, since they fluctuate from minute to minute)
- For example, if the average target value is is 400%, then only 100/400 = 25% of coins are mining blocks.
- Now you can calculate an approximate value of how many blocks you might create per day by multiplying the number of coins you own by the absolute value of the target (e.g. the absolute value of 400% = 4), and then divide by 694,444.
- For example, if you have 50,000 Nxt coins and the average value is 400%, you could forge 0.288 Nxt blocks per day, which translates to one block every 3 or 4 days.
- The number of coins you earn from finishing a block depends on the number of "fee coins" in the block. The minimum fee per trade is 1 coin, and the number of trades in a block will vary. It is possible for blocks to be empty.
Can I forge Nxt more quickly by running multiple servers and multiple accounts?Edit
No. Your ability to forge Nxt depends solely on your total account balance as a percentage of all available coins. This is what sets Nxt apart as a pure "Proof-of-Stake" cryptocurrency. CPU power, GPU (graphics processor unit) power, and the number of servers you run have no effect (as long as you have 100% uptime) – in fact, you could even forge Nxt on a very old, low-power computer!