How Nano’s lack of fees provides all the right incentives

Classical incentives, such as in Bitcoin

Simplified: The classical, old way of confirming transactions as done in Proof of Work coins such as Bitcoin has miners competing over blocks which contain many transactions. The first miner to solve a mathematical puzzle, thereby validating the block, gets the fees that were paid for all the transactions in the block and gets an X amount of Bitcoin, increasing the total money supply.

Nano’s feeless incentives

Rather than paying fees to validators, no one pays anything for Nano transactions. There are no fees, and there is no inflation. However, despite the lack of fees, there are plenty of incentives.

Incentivizing decentralization

As opposed to the aforementioned economies in Bitcoin leading to centralization over time, Nano actively incentivizes decentralization. Because there are no fees, no Nano holder or business has a reason to want a large share of validation power. The closer your share gets to 51%, the lower the value of the Nano network will be, thereby destroying your own value.

Final thoughts

While Nano’s instant and feeless proposition (try that part out for yourself, for free, here) is a great catchphrase and easy to demonstrate, the incentivization of decentralization is what makes Nano so incredibly secure. Nano becomes ever more secure in the long run, and is one of the most future-proof cryptocurrencies because of its lack of fees.



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