What is OmiseGo?

Introduction to OmiseGo:

The OmiseGo whitepaper outlines five main mechanisms which together create the OMG Network.

  1. The Decentralized Exchange
  2. Liquidity Provider mechanism
  3. Clearing in-house messaging network.
  4. Asset backed blockchain gateway
  5. White label SDK

 

The Problem

  • Every day, offers are made, and goods are exchanged. At the national or global level,there are intricate networks in place to facilitate these transactions; to collect value,reallocate it elsewhere in another way, and to take a piece of a commission, acommission.Some of the most notable among these networks (as selected in the GMO Whitepaper)are Fedwire, CHIPS, SWIFT, NEFT/IMPS (in India )and ACH. You may not know or have not heard of any of these networks. However, it is very likely that you have made use of all or some of them. They operate as financial centers, brokerage operations worldwide.
  • When we send a payment we initiate the transfer as the sender, it goes to the bank using SWIFT, NEFT etc and is sent to the recipient. There is no need to have a third party to facilitate these transfers. It can all be done on the OMG network.
  • In the new world, eWallets all over the world have gained popularity but it is still not possible to have a inter-wallet transfer. For example, we cannot transfer Venmo to Alipay or PayTM to Mobikwik (in India). Using the OmiseGo white-list SDK there can be inter-wallet transfers.
  • OMG will ensure no cost goes to third parties. It will also require no trust on any 3rd party.

 

The Ewallet

  • The ewallet from OmiseGo will have a native opt-in for crypto-support.
  • Fiat currencies will also be supported.
  • Small Transfers will be using the lighting nework. Transactions will be done off-chain for rapid payments.
  • The OMG chain validates the activity of the transactions and then submits it to the Ethereum network.
  • Liquidity in the network is maintained by staking.

 

The Decentralized Exchange

  • The decentralized exchange will be used for most transactions.
  • The DEX is the central component and not the ewallet payment provider (EPP).
  • The DEX will be ideal for interwallet transfers as it will be low latency and high frequency.
  • The entire DEX will eventually be on Plasma

 

Clearing Houses for bitcoin-like blockchains

  • Bitcoin-like blockchains do not have the ability to have smart contracts .  So a oracle is needed. Clearing houses act as that oracle to clear transactions.
  • If everything is in order then the clearing house gets bonded with the OMG chain. If not, the clearing house gets slashed.

 

 

White-labeled SDK

  • Anyone can build there own wallet using the SDK given to developers.
  • By letting everyone make ther own ewallet everyone can add their own features.
  • This also will add to the liquidity to the DEX.

 

The team

  • With such an ambitious project at such an early stage, the group and the organisation are crucial. I would say that it would be difficult to see the GMO value at this point without looking first at the team behind it.
  • Omise, the company responsible for OmiseGo has existed since 2013. They operate an online payment system in Southeast Asia. Before launching OmiseGo, they had already produced a viable product, assembled much equipment, built severe relationships in their sector, and secured $20 million in funding. Besides, OmiseGo has Vitalik Buterin (Ethereum) and Joseph Poon (Lightning Network Co-Author) among its advisers. Joseph Poon is, in fact, the author of the official OmiseGo report.
  • Moreover, it is worth noting that they made a very respectable decision to limit their ICO funding to 25 million at a time when projects that are much less solid are collecting many multiples of that. It is very likely, because of their background, that they could
    have obtained a financing three times higher, if not more. Overall, OmiseGo seeks the opportunity to revolutionize the way value changes hands around the world. It remains to be seen how well they will be able to implement it, but
    the market potential is impressive.

 

OMG Token

  • Until the OmiseGo blockchain is launched, OMG is a standardised Ethereum token (ERC20).
  • When they start their Blockchain, OMG becomes a test witness for participation in the OmiseGo network. Owning OMG tokens will buy the right to validate blocks and earn fees (Miner)
  • A little less than 10% of the existing OMG was distributed to the founding members, and 20% was set aside for development costs. This assignment is under lockdown for one year. The remaining OMGs were distributed through the ICO (or rather the pre-ico, as
    they completed their funding target in the pre-sale phase).

 

Limitations

  • Ether at this time does not have Proof-of-Stake which is needed to stake OMG.
  • Interchain transfers have roll back errrors.
  • The transactions should be public but using something like SNARKS is too slow for high frequency.

Leave a Reply

Your email address will not be published. Required fields are marked *