When and why the Loki Network cryptocurrency was created?
The Loki Network cryptocurrency is quite young, its network was launched in 2018. It uses the CryptoNight Heavy protocol to confirm its operation. There is a lot of attention to the anonymity of transactions. Since the Proof-of-Work algorithm is used, there is a network that creates new coins. In total, there can be 150 million coins of Loki. For the storage of coins, there are wallets for PC and mobile devices. Each wallet of a Loki becomes a light Loki node. There are also full Loki nodes in the network designed to protect privacy.
How does the Loki Network combine Proof-of-Work and Proof-of-Service?
Financial incentives for owners of full public crypto nodes allow creating the second level of routing. The crypto nodes functionality on the second level provides the method called swarm flagging. Service Loki node operator needs a minimum level of bandwidth and storage to the network. If the service Loki node doesn't disappear from the network and it provides good service, its chances to get a reward are increased. When connecting to the network for the first time, the service blockchain node provider takes the last place in the queue for receiving the reward. After receiving the reward, the service crypto node is again at the very end of the queue. The service nodes provider on the Loki network will operate a low latency onion routing protocol used to obfuscate the destination and origin of data packets.
How miners awards are distributed on the Loki Network?
In contrast to Bitcoin, whose miners receive a 100% reward for the calculated block signature, miners of Loki receive only 45% reward for the block signature. Service nodes provider gets 50% of the block signature award. Loki node management receives the remaining 5% award in the following ratio: 3.75% goes to Loki Foundations and 1.25% to finance promising developments for the Loki network. In order for a Loki node service to qualify for an award, its owner must have a security deposit in a separate wallet account. The amount of the deposit is floating, as using the same amount makes anonymity in the network vulnerable. The amount of margin for a Loki node is determined by a formula where the main element is h (block height). If in the first days of the network's activity 45 000 Loki coins were required as a security deposit, then in 4 years the security deposit will be non-linearly reduced to about 10 000 coins. The Loki algorithm defines the validity period of the deposit as 30 days, but the owner of the Loki node can use the automatic re-collateralization feature.
What are SNApps in the Loki Network for?
SNApps are designed to replace DNS servers, hiding network connections in the same way as in the Tor network. SNApps ensure the anonymity of both the owner of the webserver and the user. Although SNApp uses the usual model of client-server interaction, the service crypto nodes become intermediaries to connect to the Lokinet network. Each SNApp contains the service cryptocurrencies nodes descriptors, which each time a new connection path is formed. This is the similarity of the Loki Network to the Tor and I2P networks. For transaction anonymity, ring signatures, stealth addresses, and RingCT, inherited from Monero cryptocurrencies, are used.
Further prospects of the Loki Network project
Loki Network is also a service other than cryptocurrency. Loki Messenger is for communication. The connection between free public nodes of Loki Messenger is securely protected from listening or other third party interference. Lokinet allows users to create websites with hidden IP and the identity of the creator. Blink technology is actively developed for instant and secure, privacy-first transactions. This technology also relies on the Service crypto nodes system.