SuperNET Newsletter #7

Welcome to the SuperNET. A SuperNET alpha client release v0, the SuperNET v1 team defining the next and official release, NXT Freemarket update, MGW production servers running, a decentralised poker project coming together, and 100+ supporters and programmers active in Slack – it’s time for another update! This is SuperNET Newsletter #7.

Topics

SuperNET client v0
Multigateway
How MGW works
Coinomat
Freemarket update
SuperNET Tech Tree
InstantDEX
SNN
More about BTCD
- Where’s Wally?
- STASH
Development Update
SuperNET code review
SuperNET related links

SuperNET client v0

A preliminary SuperNET client (v0) has been released. This is an enhanced NXT wallet that includes the Multigateway, so can replace the standard NXT wallet with no loss of functionality. v0 is a standalone software: just install once and enjoy the combined features of Nxt and SuperNET.

Current features include the NXT client, Multigateway, Coinomat exchange, Dividend capability and Voting. v0 is the first raw version of the SuperNET client. Further features like BTCD teleport, neoDICE, CHA’s casino and so on, will all go inside this package, so it’s essentially a NXT client release with SuperNET-related functionality.

All NXT’s 2.0 features, like the Asset Exchange, encrypted messaging, the Alias System and Nxt Marketplace, are also available from within the client. To download the SuperNET v0 client, go to https://forum.thesupernet.org/index.php?topic=247.0
Screenshots: http://imgur.com/a/bljE4#0

Further features will likely be added in a rolling release until the ‘official’ SuperNET v1 client is launched, around Christmas.

Multigateway

The Multigateway’s production servers passed testing and are now live! The MGW UI is integrated in the preliminary (‘v0’) version of the SuperNET client. Please do download it and take a look at what it can do – it’s a sample of SuperNET’s coming capabilities.

The Multigateway (MGW) is NXT’s distributed cryptocurrency exchange platform. It enables users to send coins to the MGW’s secure servers, in return for coin tokens that can be traded against NXT on the Asset Exchange. The coins are kept in multi-sig addresses, whilst the NXT assets representing other coins (mgwBTC, mgwLTC, etc) are stored on the blockchain. Three servers operate for each coins, enabling trustless crypto-to-crypto transactions.

There are currently six different operators in Multigateway, as different coins are housed on dedicated and hardened servers run by different parties. As further coins are added, more server clusters will be required.

MGW Cluster #0: Frohike, Abuelau (MyNXT), Coinomat (BTC)
MGW Cluster #1: marcus03, Cobaltskky, jefdiesel (DOGE, BC, VIA)

James will keep a seventh development server online for as long as Multigateway users move to SuperNET UI and production servers.

For more information and a download link, see the SuperNET v0 installation guide:
https://multigateway.org/user-guide/installing-the-software/

How MGW works

MGW creates a unique deposit address for your account, for each of the supported coins. When you send coins to that deposit address, MGW will deliver the same quantity of coin assets to your NXT account (for example, 1 BTC will become 1 mgwBTC asset).

All the MGW deposits are held in multisignature accounts matching all the released assets 1:1 – there is no fractional reserve here! Coin assets can now be traded in the NXT Asset Exchange like any other asset .You can buy them with NXT, sell them for NXT and send them to any other NXT user with the fast speed of the NXT network. MGW allows you to withdraw your coin assets back into your corresponding coin wallet, with the lowest withdrawal fee in the market – equivalent to the minimum transaction fee for the coin.

What are the advantages?

MGW is significantly more secure than a centralised exchange, with no single point of failure. It is also far more cost-effective to use.

In a multisignature account, the same address has several associated private keys or signatures. This means the servers have to agree, each of them providing their signature, in order to process the coin transactions – in a similar way to a joint bank account. The use of multisignature accounts and independent servers makes MGW more secure than any traditional centralised exchange account.

IMPORTANT NOTICE TO EXISTING MGW USERS

The production servers use a new asset ID for mgwBTC. Existing owners of mgwBTC need to swap their old assets by sending them to a special redeem account. This will automatically send back the same amount of the new mgwBTC asset.

mgwBTC redeem Nxt account: NXT-6YQW-HHCG-NATW-DCHJ3
Production mgwBTC asset ID: 17554243582654188572

The old mgwBTC asset (4551058913252105307) can of course still be traded in the existing market in the Asset Exchange, and users running a previous version of the software will be able to withdraw these through the old servers for some time. However, we recommend you update your assets for a greater stability and growing activity in the service.

Coinomat

Another SuperNET CORE service which has been integrated in the preliminary SuperNET v0 client is the Coinomat tab. It enables you to exchange your Bitcoins directly in the client.

With the SuperNET v0 client running, you can also trade assets on the Nxt asset exchange. Coinomat offers CoinoUSD (asset ID 12982485703607823902, a USD-tied asset. 1 CoinoUSD always holds the value of $1. It’s traded against NXT on the asset exchange, thus creating the first NXT/USD decentralized market, it can be traded for BTC/NXT/XMR on the centralized exchange Poloniex, and you can buy and sell it using Coinomat services.

CoinoUSD can be withdrawn to Perfect Money, EgoPay, OKPay – or VISA / Mastercard.
Read more about the use cases here: http://blog.coinomat.com/coinousd-usd-on-blockchain/

Freemarket

A new version of NXT Freemarket is ready for download at http://nxtfreemarket.com/

NXTFreeMarket is NXT’s decentralised market place – a little like eBay, but with super-low fees (no fees until 2015, and then only 7.77 NXT per listing). It’s also getting some great press: There’s a podcast from Free Talk Live http://www.freetalklive.com/content/podcast_2014_11_10 and this one from CoinTelegraph: http://cointelegraph.com/news/112883/dear-online-drug-buyers-your-problems-are-solved

FreeMarket’s complete list of new features includes:

A standalone version (no more messy install!)
Seller ID in item listings is now a link to see all items from that seller
Passphrase fields now integrate with password managers such as 1Password and LastPass
Image Preview: See if you have the right URLs for your images before listing your item!
More built-in help
Tightened security
Improved Chinese localization
New localizations: German, Spanish, Lithuanian, French, Japanese, Greek, Hebrew, Italian
Various bug fixes
One-click re-listing of expired or canceled items

SuperNET Tech Tree

Work has just started, but here’s a taster of what’s cooking: ThomasVeil’s interactive “tech tree”. This will provide an overview of how SuperNET, its services, coins and dividends to its asset holders works.

InstantDEX

InstantDEX is a core service for SuperNET. It will allow near-realtime exchange of one cryptocurrency to another. This will have huge implications for trading, since delays will be reduced to near zero.

A further tool to help manage the InstantDEX order book in the future will be tradebots. These will be user-programmable and will run on the user’s node, customisable for the individual’s needs. One use case might be the conversion of dividends from one currency into another; a tradebot could be set to carry out the exchange at a target price. All of the functionality will take place in the background, making it extremely convenient for the end user.

Naturally this raises issues of liquidity between different coin pairs; obviously users do not want to have to pay for large spreads. James writes, ‘I plan to create 1% spreads between all the SuperNET core coins in native and telepod form and mgwCOIN form, so you can go from one to the other to the other, and the tradebots can be programmed to suit your goals.’

On the technical side of how this will work, James writes:

I had to figure out how to index into DB with duplicates properly, and also add in special cases to the DHT to support InstantDEX orderbooks.

The method is as follows:

A. an orderbook bid or ask is submitted using the standard DHT store and this is processed normally.

B. as this is processed, various nodes do a localstore into the public.db on their HDD. When this is done, the raw data is checked to see if it is an InstantDEX quote and if it is, an automatic update is triggered.

This update allows one bid and one ask per account, which has the effect of preventing the orderbook stuffing.

At this point, the node that is closest to the key value of (baseid ^ relid) will have an up to date orderbook and the normal orderbook function should display it properly.

Of course, this does no good for most all people, so we also need to support returning the full orderbook via DHT findvalue call. The problem is that there is no automatic way to know if a key value is for an InstantDEX orderbook. So, using a similar method to overloading the findnode command with a datastr, I added a datastr to find value.

This would just be the “orderbook” API command, which needed to have an “oldest” field added. what that allows is for the nodes that have data to send back to filter it so only the new data is sent.

When this is all debugged, all nodes will be able to get an up to date orderbook as quickly as a DHT command can be processed. Now, even if this is taking 10+ seconds, odds are that the same accounts are having the best offers and really that is the most important as the exact trade matching is done peer to peer.

InstantDEX is an absolutely critical part of making crypto frictionless for the end user, so it is extremely encouraging to see the progress being made here.

SNN

The SuperNET News Network is coming together, with the backend currently in active development. When it is finished, it will allow for multi-tiered management – one senior writer will be able to manage multiple junior writers. This means that one Editor in Chief can manage a whole staff in a streamlined, automated way.

In the meantime, writes fumanchu88, ‘SNN will be more akin to a standard news platform but with a backend that makes management and payroll open and transparent.’ Features will include:

Automated payroll based on social weight of each article
Tiered management (posts are sent to an editor for clearance once when ready to publish)
Automated Advertising Intake (advertisers can sign up without previous contact)

Payment is always tied to the site’s earnings in the relevant pay period, so there are strong incentives for everyone to promote the site and work together. Contributors will not have to pay to post content; they will simply post their articles, promote them as best they can and interact with comments, where appropriate. The system will do all the weighing, with payout once a week. Regular writers will therefore receive regular pay in NXT and/or BTC.

More about BTCD

Last week we took a closer look at NXT, one of the core coins for the SuperNET. NXT offers versatile 2.0 functionality, and many of the SuperNET’s features are built on top of NXT. But the SuperNET equally could not exist without BTCD.

BTCD provides the secure network that will enable private communication, anonymous transactions and much else besides. BTCD’s infrastructure is a peer-to-peer network similar in principle to file-sharing networks such as BitTorrent (in fact, secure file-sharing will be one of the future revenue-generating applications of the BTCD network, since it enables users to rent out spare hard drive space for others to use).

BTCD’s Telepathy protocol (you can read more about how Telepathy works here) offers privacy advantages over and above anything else currently on the market. All communications are end-to-end encrypted, so that no one else can read them. However, the real step-change in privacy is the use of deaddrop addresses for secure communication. In other peer-to-peer networks, nodes send packets to each other, which requires them to know the IP address of the recipient. This constitutes a leak of information, and a well-resourced attacker would be able to tell who was communicating with whom – which could be as important as what they were communicating. Deaddrop addresses are owned by no node, and so the packet is never ‘delivered’ to this recipient. As it is being routed, though, it is handled by many different nodes – but it can only be read by the node for which it has been encrypted. This is a little like being able to send an email without anyone (including the sender) knowing the address of the recipient.

BTCD wallet

A new BTCD wallet based on the NXT-Inside concept is currently in the works. As well as being user-friendly, this approach will allow stakers to be paid dividends from SuperNET (James offered stakers dividend payments from InstantDEX before developing SuperNET). To preserve privacy and ensure payments cannot be linked to other accounts, dividends will be converted to BTCD before distribution – placing a gentle, constant upward pressure on prices.

Where’s Wally?

During the recent sell-off of the alts, questions were raised about why BTCD prices were dropping so much despite the tech being developed. This was partly due to one of the original large holders from the mining stage cashing out their stake. Since then, a bot has been detected, manipulating the BTCD market. This bot is active on many different alts, but since BTCD is comparatively thinly-traded, it has had a greater effect. James writes:

There is a bot that is ACTIVELY manipulating the price, quite effectively too. If you look at the price on bitcoinwisdom, you will see that there is a pretty even spread of asks all bunched together, within 10 satoshis!

About 5 BTC. This makes a barrier and also crowds out the orderbook so you can’t see what is really going on. It is also changing things several times per second to create the impression of a lot of activity. What it does is pushes the price down by clearing out small bids and making lower and lower asks.

Earlier there was about 10 BTC in 30+ orders around .0049 and 3 BTC between that and .008

So, there is no investor panic going on. It is just one guy running a bot. And he is doing this on many different coins.

His game is this.

Have the bot on bittrex and cryptsy, but run just one of them at a time. Create some FUD, push the price down on one (easier to create fear, especially in a bear market), then as people get convinced everybody is selling, they start selling. Remember this is just happening on one market. So soon the sell price on one exchange is lower than the buy price on the other exchange where the bot is idle. Guaranteed profits! Then the bots switch.

So first one exchange price is pushed down, arbitraged, then the other. Doing this it creates these mysterious price declines as we are making such good progress. All the way down to .005! But there was really very little for sale below .008 as this operation is being done on dozens of coins, so only so much budget per coin.

Now this bot is not caring about price at all. Whatever the price is, it just picks the exchange with the lower price, pushes it down until it can arbitrage. The arbitraging evens the price out and then the pushing starts again. Now this bot stays away from even a 1 BTC wall from what I have seen and certainly anything larger it stays about 10% away from. However if there is no big wall, it happily starts pushing the price down, even filling some orders if they are small enough.

These bots are probably on autopilot, so that means a clever person will be able to trick the bot.

Stash: mass-market BTCD application

Cryptocurrency offers significant advantages over fiat money, but adoption has been slow in comparison to expectations. Part of the reason for this is that cryptocurrency is still too complicated for general use (something that the SuperNET GUI aims to address). However, many people are not really dissatisfied with the service provided by banks and payment processors; crypto is consequently seen as an ‘answer without a problem’.

BTCD’s secure communication capabilities offer the chance to market it in a different way. Most marketing initiatives start in crypto and reach out to mainstream users, with a limited degree of success. The Telepathy network has direct and immediate application to the mainstream. Every week there are more stories of hacked databases, large-scale harvesting of personal data by big corporations, and ever-more intrusive government surveillance. The majority of internet users recognise that their data can no longer be considered their own: everyone has an online footprint, and with the right tools this is almost as transparent as the blockchain.

The Stash concept aims to apply BTCD and SuperNET’s functionality to these problems. A series of related services might be offered to users, including private messaging and secure storage on the SuperNET network. If customers wanted to purchase further services (more storage, for example), they would have to do so using cryptocurrency. The transaction would be made as frictionless as possible using SuperNET’s integrated Coinomat plugin or other services. The Stash wallet would essentially be a highly-simplified BTCD/SuperNET wallet, offering minimal functionality.

The concept is still in its early days but has the potential to draw in a large number of new users from outside of current crypto circles. At the very least, this would strengthen the network and provide many more peers. In the best case scenario, a proportion of these new users would learn about and use cryptocurrency, starting with BTCD and SuperNET.

You can see a holding page at www.Stash.xyz. For more information or to offer help and expertise, please ask on the Slack channels.

Development Update

Things are coming together fast with the v0 release, and more on the way soon. James writes:

‘I have most all of the API needed for v1 released coded and now entering the painful systems debugging stage. The nature of the work changes now to making bugfixes instead of writing new code and just getting everything to work at the same time, along with performance improvements.

‘Still need more testers, but I am acting as the first tester since I rely on the API calls to get the basic functions working. Not sure which will finish first, my debugging or the GUI and websites, but probably pretty close race.

‘The telepathy is not 100% reliable, but it is working most of the time when you are nice to it. Got things a lot more stable at the low level and that allowed a couple of BTC teleports, but this exposed some state machine bugs. Not surprising as it is quite tricky and first time the entire process is being tested all at the same time.

‘Need to think about how best to integrate the InstantDEX with Teleport. I keep alternating days, working on one, then the other, pushing them closer and closer. One of these days I will be able to get them both playing nice with each other.

‘Pushed new version that supports gathering prices into databases and also retrieving this data. bter, poloniex, bittrex, NXT AE and even mintpal [mintpal has been removed until further notice because of this unfortunate situation] is supported.’

The code to test this is:

curl -k –data-binary ‘{“jsonrpc”: “1.0”, “id”:”curltest”, “method”: “SuperNET”, “params”: [“{\”requestType\”:\”getquotes\”,\”exchange\”:\”bter\”,\”base\”:\”NXT\”,\”rel\”:\”BTC\”}”] }’ -H ‘content-type: text/plain;’ https://127.0.0.1:7777/

curl -k –data-binary ‘{“jsonrpc”: “1.0”, “id”:”curltest”, “method”: “SuperNET”, “params”: [“{\”requestType\”:\”pricedb\”,\”exchange\”:\”nxtae\”,\”base\”:\”BTC\”,\”rel\”:\”NXT\”}”] }’ -H ‘content-type: text/plain;’ https://127.0.0.1:7777/

‘Now each user can gather data for the crypto they are interested in and this creates the reference prices to overlay on the InstantDEX orderbook. took a bit longer than I had hoped to get it stabilized as I had to serialize all accesses and avoid deadlocks. Systems stuff is quite tricky and feels like not much progress, but now at 2% CPU usage, it is able to handle all the packets and gather price data.’

Code review

Bitcoin privacy and security expert Kristov Atlas currently undertaking a code review of SuperNET. As James comments, ‘With nearly 40,000 lines, there will be bugs and parts of it I don’t like at all…’

Meanwhile Zahlen has started to analyse the maths and will add material further to the white paper in due course.