What is Zilliqa Coin (ZIL)?
Posted by Frank Gogol in Crypto | Updated on August 23, 2022
Zilliqa coin is the native crypto coin of the Zilliqa blockchain. The Zilliqa blockchain focuses on sharding technology and uses an unusual consensus mechanism. Read on to learn more about this project.
Table of Contents
What is Zilliqa? (ZIL)
Zilliqa is the name of a smart contract blockchain platform. Zilliqa uses a technology called sharding to maximize the number of transactions that can be performed at any given time.
Zilliqa also uses a unique consensus mechanism that is a hybrid of proof-of-work and Practical Byzantine Fault Tolerance (PoW and pBFT).
The native cryptocurrency of the Zilliqa blockchain is the Zilliqa coin, also called ZIL. ZIL is used to pay for transactions on the blockchain. These fees are used to reward the nodes that perform the calculations to operate the blockchain.
The project began in 2017 and was founded by a team of researchers from the National University of Singapore. The team later founded a company called Zilliqa Research to direct the development of the Zilliqa project.
How Does Zilliqa Work?
Zilliqa uses sharding to maximize the number of transactions that can be confirmed per second. In addition, the blockchain uses an uncommon consensus mechanism. These concepts are explained in a bit more detail below.
A blockchain is a record of the balances and transaction history of a group of accounts. This record is shared by a large number of independent computers (called nodes) that must agree with each other on the exact details. Each time a new transaction is added, all of the nodes check whether it is fraudulent then add it to their copy of the record.
It is possible to break this record into smaller, simpler parts that are easier (and therefore faster) to add to. Each smaller part of the main record is called a shard.
Groups of nodes are assigned to each shard, and they perform the same operations as before, adding and checking new transactions. At routine intervals, a separate group of nodes combines the records from each shard to unify the information before sharding it again.
In this way, shards allow the balances and transaction data to be effectively accessible to the whole network, but without requiring every node on the network to have its own huge copy of the entire record. The nodes only handle the shard they’ve been assigned to.
A blockchain consensus mechanism allows independent nodes to share the same ‘truth’. In other words, to all have the same values for the balances and transactions histories of the accounts on the blockchain.
There are many different kinds of consensus, but they all work by making it either difficult or expensive for one node (or a small group of nodes) to trick the rest of the network into accepting fraudulent transactions.
Consensus allows good behavior to be maintained by all participants without a central authority.
Zilliqa uses an unusual consensus mechanism that combines proof-of-work (PoW) and Practical Byzantine Fault Tolerance (pBFT).
PoW makes it difficult to trick other nodes because doing so would require a lot of computing power. The new record (block) gets added only if it was the first one proposed. The first node to successfully propose a new block gets paid a block reward in ZIL.
pBFT makes it difficult to trick other nodes because all the nodes must unanimously agree on the truthfulness of the new block before adding it.
The only way to add fraudulent transactions would be to simultaneously control all the nodes. Every node involved in the unanimous decision gets a small share of the block reward.
The Zilliqa team claims that PoW and pBFT together create a secure mechanism that allows for mining with lower-cost computing. The pBFT component means having the fastest computer is not the only requirement for getting a reward.
Primary Features of Zilliqa
Zilliqa is a smart contract blockchain. This means programmers can develop decentralized applications (dApps) that run on Zilliqa.
The following is a list of Zilliqa features:
- Low Cost – Sharding allows for a large number of transactions per second, so the cost of each transaction is low
- Scalable – Sharding also means that as more people start to use the blockchain, its capacity can be increased by just increasing the sharding
- Cost-effective mining – The unanimous agreement required by pBFT means that even lower-powered hardware can get a portion of the block reward. This makes mining ZIL more cost-effective because a node can get some reward, even if it never proposes a block first.
How to Use Zilliqa Coins
Zilliqa coins are used to pay for transactions on the Zilliqa blockchain. Just like every other cryptocurrency, you will need a Zilliqa-compatible crypto wallet to use Zilliqa coins.
There are more than a dozen different software and hardware wallets you can use to store, transfer and even stake your ZIL.
The list below is just a few of the ZIL compatible wallets you can choose from:
- Ledger (hardware)
- Trust Wallet
- Atomic Wallet
Hardware wallets are generally more secure than paper or software wallets, but also more expensive. If you can afford it, a reputable hardware wallet is a very good investment in the safety of your crypto assets.
Many crypto wallets are compatible with multiple blockchains. This compatibility means you can store many different coins, tokens, and other assets without juggling many different wallets.
When you are paying for transactions on the Zilliqa blockchain using ZIL, the process is automatic.
- You must start with a non-zero amount of ZIL in the account that you are sending the transaction from.
- Before you confirm the transaction, your wallet app will inform you what amount of ZIL the transaction will cost, and the equivalent value in USD.
- When you confirm the transaction, it will take a short while for it to be added to the blockchain
Pros and Cons of Zilliqa Coin
There are some advantages and disadvantages to using and owning ZIL, or Zilliqa coin. These are summarized below.
- Low cost – In December 2021, 1 ZIL costs less than 0.10 USD, meaning there is a possibility for profit in the future if Zilliqa gains a large number of users and the demand for Zilliqa coins increases.
- Stake-able – ZIL can be staked (using a Zilliqa-compatible crypto wallet) to allow you to earn extra ZIL while you hold the coin.
- Wallet support – There are more than a dozen Zilliqa-compatible crypto wallets, including major names such as Ledger and Trust Wallet.
- Newness: Zilliqa is a much newer project than, for example, Ethereum. This means that widespread uptake might be very slow if it ever happens. If you want to invest in ZIL in hopes that its price will increase as more people use it, this may be risky.
- Availability: Although it is available on international exchanges like Binance, and liquid.com, ZIL is not yet listed on any major U.S.-based cryptocurrency exchanges.
- How to Make Money with Cryptocurrency
- How to Withdraw from Binance
- How to Transfer From Coinbase to Coinbase Pro
- How to Transfer from Coinbase to Binance
- How Does Cryptocurrency Gain Value?
- How to Read Crypto Charts
Zilliqa coin (called ZIL) is the native coin used on the Zilliqa blockchain. Zilliqa uses sharding technology to increase the number of transactions that the blockchain can handle. Zilliqa coins are used to pay for computing power on the Zilliqa blockchain.
Need a Loan? Get One in 3 Simple Steps
If you are considering applying for a personal loan, just follow these 3 simple steps.
Apply online for the loan amount you need. Submit the required documentation and provide your best possible application. Stronger applications get better loan offers.
If your application meets the eligibility criteria, the lender will contact you with regard to your application. Provide any additional information if required. Soon you’ll have your loan offer. Some lenders send a promissory note with your loan offer. Sign and return that note if you wish to accept the loan offer.
The loan then gets disbursed into your U.S. bank account within a reasonable number of days (some lenders will be as quick as 2-3 business days). Now you need to set up your repayment method. You can choose an autopay method online to help you pay on time every month.
Stilt provides loans to international students and working professionals in the U.S. (F-1, OPT, H-1B, O-1, L-1, TN visa holders) at rates lower than any other lender. Stilt is committed to helping immigrants build a better financial future.
We take a holistic underwriting approach to determine your interest rates and make sure you get the lowest rate possible.
Learn what others are saying about us on Google, Yelp, and Facebook or visit us at https://www.stilt.com. If you have any questions, send us an email at [email protected]