What is OMG?
The OMG Network is a trustless, non-custodial, Layer-2 scaling solution for transferring value on Ethereum. Projects on the OMG Network run faster and cheaper without compromising the security of Ethereum. You can transfer ETH and ERC20 tokens with a throughput of thousands of transactions per second. The Network also reduces electricity usage by potentially 99% per transaction compared with Ethereum. OMG also claims that you can operate your business or project at one third the average cost of the Ethereum Network.
Why does OMG exist?
Billions of people have smartphones and internet access, but limited connections to traditional bank accounts and services.
OMG aims to make it easier and safer for everyone to access financial services in a trustless, permissionless way through cryptocurrencies.
How is the price of OMG determined?
OMG's price is determined by how much OMG is available for sale and how many people want to buy it (supply vs demand).
As OMG's network design is proof-of-stake, at any one time there could be a lot of OMG tokens tied up in smart contracts (in addition to people holding them for investment purposes). This means OMG has the potential to be more scarce when compared with other cryptocurrencies (positively affecting the price).
140 million OMG are available in total, with over 100 million in circulation.
The price of OMG is calculated many times per second by exchange computers all over the world. Just like any other traded item, the price floats between what sellers are asking (Offer Price) and what buyers wish to pay for OMG (Bid Price).
What the bears are saying
- OMG could be considered 'centralized': Unlike many cryptocurrencies, OMG is overseen and developed by a company, as opposed to a ‘decentralized’ community of developers.
- Other decentralized exchanges are launching: There are several decentralized cryptocurrency exchanges in operation, with more coming online.
- Success depends on partnerships: The success of OMG is dependent on the success of partnerships with e-wallet providers and decentralized financial networks.
What the bulls are saying
- OMG has vast potential: Cryptocurrency exchanges are big businesses, with the potential for enormous growth over time. OMG’s decentralized exchange functionality could see it take a big portion of this business.
- The technology is powerful: OMG Network’s highly-efficient processing technology could transform how financial inclusivity is attained and delivered globally.
- It adds value to Ethereum: Ethereum is the world’s most-used smart contract platform, making it advantageous for OMG Network to provide services on it.
How to buy OMG
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This article is for informational purposes only and takes no account of particular personal or market circumstances, and should not be relied upon as investment, tax, or legal advice. For investment, tax, or legal advice and before taking any action you should consult your own advisors. Note that digital assets such as cryptocurrencies present unique risks for investors. Please see our disclaimer regarding risks specific to holding digital assets before investing.
This content is correct as of October 2020
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