About Nervos Network (CKB)

Nervos Network combines an underlying blockchain infrastructure with a suite of development tools known as the “Universal Passport” to foster the creation of interoperable applications. The underlying blockchain is public and it is a layer-1 protocol that uses Proof-of-Work (PoW) consensus. It supports creation of smart contracts. To facilitate high-volume use cases, Nervos also consists of a series of layer-2 scaling solutions

The platform has a native token, CKB. It’s used for executing smart contracts on the network. And it allows users and developers to claim storage space on the Nervos blockchain in proportion to their holdings, according to Messari. CKB can be deposited to the Nervos’ decentralized autonomous organization (DAO), called Nervos DAO, in exchange for a portion of the block rewards that go to the protocol’s network of PoW miners. Holding CKB also allows users to rent storage space on the Nervos blockchain, according to project documentation.

Nervos’s Common Knowledge Base is a layer-1 PoW blockchain that works to confirm transactions processed by the protocol’s network of layer-2 scaling solutions. It’s a framework similar to those employed by popular “networks of networks,” such as Polygon.

Common Knowledge Base also works to store all relevant network data. Individual layer-2s submit processed data to be stored by the CKB, the project’s whitepaper explained. Layer-2 protocols operating on the network can be made permissioned or permissionless and possess the ability to develop their own consensus mechanism.

Nervos’s Universal Passport provides a suite of tools that enable developers to create interoperable applications “that transcend individual blockchains to work seamlessly across every chain in the ecosystem.”

The platform bundles its PW Core wallet with the cross-chain Force Bridge and an EVM compatibility layer – Polyjuice – to create a powerful decentralized application (dApp) building solution.

The PW Core wallet allows Web3 users to utilize their existing Ethereum addresses to interact with Nervos-based applications and send/receive CKB tokens, eliminating the need to download a new wallet each time you interact with a new dApp, documentation said.

Force Bridge is a streamlined multi-chain asset bridge that fosters interoperability by allowing users and applications to move tokens between independent blockchains.

Polyjuice is an Ethereum Virtual Machine (EVM)-compatibility engine billed as “Ethereum on CKB” that allows developers to implement their Ethereum-based applications to Nervos with no changes to the underlying code.

When was CKB and how much was it worth?

Nervos was launched in 2018 by Kevin Wang, Daniel Lv and Terry Tai, all of whom hold senior leadership positions at Nervos Foundation, Hangzhou, Zhejiang, China, according to Messari.

 Wang, according to a post on Medium, has worked in tech as a consultant/engineer. Prior to co-founding Nervos, Wang had worked on enterprise data solutions at IBM Silicon Valley Lab. He also co-founded Launch School, an online school for software engineers. At Nervos, Wang focuses on token economic research.

Per the Medium post, Lv helped co-found imToken, an Ethereum wallet.

That same post describes Tai as having been chief product officer at Cryptape, a well-known blockchain engineering team in China, before leaving to co-found Nervos.

The project’s mainnet went live in November of 2019. Prior to launch, Nervos was able to obtain $28 million in funding from a series of industry backers including Sequoia, Polychain Capital and Huboi, among others.

The project’s native token, CKB, was released via private sale to those aforementioned investors in July of 2018 at a price of $0.006. A $72 million public sale followed some 15 months later in November 2019.

Pricing data from CoinGecko shows that CKB largely consolidated for 14 months following its public distribution before surging to an all-time high of $0.0437 in March of 2021. After a summer of downside volatility, the token rallied, as did the wider crypto market, during the latter weeks of 2021. CKB has been subject to severe downside volatility in 2022.

How is the price of CKB determined?

Per Messari, CKB is an inflationary asset with no hard cap. The token features base issuance of 33.6 billion set to be fully distributed in the coming years. CKB also has a “secondary issuance” that is set to inflate supply by 1.344 billion tokens per year, every year.

CKB’s base issuance was earmarked for the token’s 2019 public sale, as well as Nervos’s ecosystem fund, development team, and strategic partners, while the secondary issuance is used to reward miners for securing the network.

As of July 2022, there were 33.34 billion CKB tokens in circulation.

Why does CKB have value?

CKB’s store of value is a factor of demand among smart contract developers for the network’s underlying blockchain infrastructure, and its toolkit. Using Nervos, projects can scale while maintaining the security benefits of a decentralized PoW ledger, in theory an appealing attribute from the standpoint of a broader bet on interoperability, which describes a world in which different blockchains interact. 

Is CKB secure?

The Nervos mainnet features PoW mining for security, Messari said. PoW is a common Sybil resistance method for layer-1 networks.

What are the main benefits of CKB?

• Nervos combines a secure PoW base layer to confirm transactions processed at scale by the platform’s network of layer 2 solutions.
• Nervos’ Universal Passport allows developers to build interoperable applications.
• Developers of Ethereum-based applications can deploy their projects on Nervos with no changes to the underlying code.

What do the critics say about CKB?

 That it’s fighting for relevance in a crowded field. Additionally, CKB, purely from a technical trading standpoint, is “settled below the middle line of the Bollinger band,” as CryptoNewsZ said, explaining that, in terms of CKB chart patterns, sell pressure persists, such that momentum is to downside. To sum up their technical analysis, CKB has been on the decline and no turnaround pattern has appeared.