The purpose of the Syscoin Platform is to provide today's enterprises and organizations a platform to benefit from blockchain and distributed ledger technology (DLT) with high security and availability, reduced infrastructure and transaction costs, and a variety of enterprise-level features. Syscoin Platform consists primarily of original source code and maintains an up-to-date base of Bitcoin Core, complying with Bitcoin's proven security model.
The project was initially created as a blockchain protocol that expanded on the concepts of Bitcoin to include additional services, like smart contracts, to enable the creation of a decentralized marketplace. The project launched in 2014 as a fork of the Litecoin network. Soon after it completed its token sale and mainnet launch, its funds were allegedly stolen by the operators of Moolah, the exchange selected to custody the proceeds of the sale. Over the next two years, the team worked to build Syscoin 2.0, which it eventually launched in May 2016.
The launch of the 2.0 network included a new graphical interface and wallet, replacing the previous command line interface. In Aug. 2017, the Syscoin team created Blockchain Foundry as a separate entity to help realize its goal of creating a marketplace platform. In Sept. 2017, Blockchain Foundry released its first product Blockmarket, a blockchain-based e-commerce solution. Following the successful launch of Blockmarket, Blockchain Foundry raised $3.3 million to fund its operations, which included research and development for various blockchain innovations outside of Syscoin.
On April 30, 2018, Syscoin released another upgrade to the network (3.0), which includes the ability to create unique fungible and non-fungible tokens on top of the blockchain. Syscoin 4.0, its latest upgrade, involves a number of changes including: Z-DAG - a decentralized DAG for assets which features global sorting of DAG consensus and near-instant transactions, with SHA256 finality also achieved in background and Bridge - cross-chain asset interoperability without requiring atomic swap nor intermediaries, that offers scalability to Ethereum and other platforms, giving ERC20's, etc, the option to utilize Z-DAG for simple value transfers/micro-transactions.
Syscoin is a merge-minable SHA-256 blockchain that provides an array of useful services that leverage the Bitcoin protocol and blockchain technology:
Hybrid layer 2 PoW/PoS consensus with bonded validator system (masternodes)
ZDAG technology (patent pending) for point-of-sale speeds and probabilistic confirmations useful for microtransactions
Trustless sidechain access to Ethereum and back through a custom permissionless/trustless sidechain technology (Syscoin Bridge)
Decentralized governance (blockchain pays for work via proposals and masternode votes)
Digital asset creation and management
Syscoin Platform utilizes masternodes as a source of bonded validators, a global resource pool, and means of decentralized governance. Syscoin Masternode owners benefit from scheduled seniority bonuses in addition to standard block rewards
Syscoin uses a transaction framework though which users can determine their optimal means of transfer based on the nature of their transaction (micro or macro). This patent-pending technology is called ZDAG (https://syscoin.org/zdagsyscoinwhitepaper.pdf) and it aims to enable ideal microtransactions that provide probabilistic security (99.9999% detection of double-spends) and global consensus for token transfers -- though it does entail a security trade-off versus Proof-of-Work (PoW) systems. After a short period of time, ZDAG gives way to PoW to ensure long term settlement assurances. If the tradeoff is undesirable, users transferring high value can also opt to rely exclusively on the Proof of Work base layer, which operates at a block time averaging 60 seconds.
This project also supports interoperability through the Syscoin Bridge. This technology does not involve counterparties nor collateralized custodians holding user funds in an attempt to eliminate the risks and limitations commonly associated with cross-chain interoperability. Integration efforts are currently focused on establishing a bi-directional Bridge with Ethereum by means of dual-contract 2WP (two-way peg). In the case of Ethereum, ERC-20 tokens are enabled to utilize the Syscoin Token Platform with ZDAG for fast, low-cost microtransactions. Additionally, this could help address some of the scalability concerns surrounding the Ethereum network; offloading standard token transfers to Syscoin Network enables Ethereum Network to better-perform its flag-ship functionality, Turing-complete smart contract execution. Likewise, Syscoin Platform Tokens are enabled with Ethereum's smart contract capabilities and toolkits.