Hashingnews
What is the Mainnet?

Guide: What is the Mainnet

HashFlare

Although the intrinsic value of cryptocurrencies is still difficult to estimate, some characteristic features may indicate the success of a particular project. One of them is advanced technology. Of course, investors are not required to understand the technical aspects, but progress in this area should be visible even to beginners. Test network-testnet – allows you to demonstrate a working prototype. However, to assess the prospects of the cryptocurrency or the mainnet project (the main network) is much more important. In this article we will talk about the features of the mainnet networks and will analyze two of them, which have recently started their work.

What is the Mainnet?

In fact, every blockchain project has such a network. Mainnet is the blockchain, which holds the real operations cryptocurrency and sends it from sender to recipients. This is the main difference from the testnet network, in which the project runs in test mode. We can say that testnet is a prototype that demonstrates the potential of the project, and mainnet is a complete product ready for use. The work of mainnet can be changed if the developers or the crypto-currency community decide that there is a need for an update or revision.

Should I invest in a project without a mainnet?

Under ideal conditions, each project that comes out on the ICO should already have a working main network. However, in real life this happens quite rarely. In fact, many projects do not even have a test network during the initial token placement. They raise money only on the basis of potential applications of their ideas, technical concepts and other factors, such as an experienced development team and existing partnerships. Often, the money collected during the ICO, first goes to the development of the prototype, and then — the finished version.

How does mainnet help the investor?

From the point of view of the investor, the availability of a working head network indicates the technical progress of the project. Even if the investor is not ready to invest before the appearance of the finished product, he must understand that the start of the mainnet can have both positive and negative impact on the value of the cryptocurrency.

However, most investors still prefer to invest in the project before the start of the mainnet, because its successful launch can sometimes lead to an increase in the value of the cryptocurrency.

What is the impact of the launch of the mainnet has on prices?

Does the successful launch of the parent network lead to an increase in the value of the cryptocurrency? Not obligatory. It is important to consider the market context. Two launches of mainnet networks this year help to reveal the meaning of these words.

Integration of Lightning in the mainnet bitcoin Network

As noted earlier, the successful launch of mainnet networks is an important, but not the only component that determines the success of the crypto-currency project. Its development requires constant updates and integration with the main network.

A good example is the launch of the Lightning Network in the mainnet-bitcoin network, held on March 15. Lightning Network is the layer outside of the blockchain to speed the transaction. The purpose of this technology is to scale and increase the bandwidth of not only bitcoin, but also other cryptocurrencies. The bitcoin blockchain is capable of processing about 7 transactions per second. After the Lightning Network is launched, its speed should increase significantly.

Unfortunately, investors did not react to the integration of the Lightning Network in the bitcoin mainnet. In fact, between March 1 and 30, the price of bitcoin fell from $10,600 to $6,900.

Why did this happen? In this case, it is important to take into account the situation in the market at that time. In March, almost all cryptocurrencies fell in price, and the dynamics of the market was typically bearish.

Although technically the integration of Lightning Network has become a significant event, the cost of bitcoin has been significantly influenced by other factors. Hard to tell how affected the launch of the Lightning Network in the network mainnet on the stock of cryptocurrencies.

The launch of the mainnet Golem

The source code for Golem Brass Mainnet was published on April 10. The goal of the project is to develop a system for sharing computing power. In fact, users who require additional computer power pay those who have an excess. Between March 31 and April 29, the price of GNT actually increased from $0.2 to $0.6. On April 13, it even jumped to $0.73.

At first glance, there is a direct correlation between the launch of Brass Mainnet and price growth. However, as with Lightning Network, it is important to monitor the market background. Some of the growth of GNT is probably due to the launch of mainnet (especially the surge on April 13), but it’s hard to say for sure which one. Most cryptocurrencies also went up in April. Perhaps without running mainnet price Golem would grow a bit slower.

Conclusion

Mainnet networks are important because they prove the ability of developers to bring the project to real life. The launch of mainnet does not always give a good idea of the overall progress of the project, but it should be taken into account when investing in cryptocurrencies. As history shows, it is difficult to say what effect the launch of mainnet will have on the dynamics of prices. One thing is certain: it indicates the project’s progress to the working stage.

In addition, it is necessary to take into account other factors, such as market trends and the application of the project in the real world. Regardless of whether the launch of the mainnet network will be successful, it is important to remember that it does not cease to develop, and the crypto-currency projects themselves are improved and supplemented with new functions.

Add comment