Nervos Network is an open source public chain ecosystem and protocol collection.
Nervos CKB (Common Knowledge Base) is the first-layer public chain protocol based on PoW of Nervos Network. While allowing any encrypted assets to obtain security, stability and permissionlessness, it can support smart contracts and second-layer expansion solutions, and through the crypto-economic design of "value storage", the native token CKBytes captures the value of the entire network.
The CKByte (CKB) token is the native token of the network and has the following use cases:
Network state storage: CKB represents unit capacity in bytes, and they enable token owners to occupy a portion of the overall global state of the blockchain. For example, if a user owns 1,000 CKB, he/she can create a unit with a capacity of 1,000 bytes, or create multiple units with a total capacity of 1,000 bytes. He/she can then use these 1,000 bytes to store assets, application state, or other types of common knowledge.
Miner compensation: Block rewards and transaction fees are provided to miners in the form of CKB tokens.
Staking Rewards: CKB holders can deposit and lock their native tokens in a special contract called NervosDAO to earn staking rewards.
The CKB sub-ecosystem is mainly composed of three parts:
RGB++ protocol: a protocol for issuing Bitcoin assets
Nervos: Bitcoin’s Second Layer Scaling System
UTXO Stack: used to build a blockchain system based on UTXO architecture.
RGB++ is an asset issuance protocol in the Bitcoin ecosystem. It originates from the RGB protocol, but solves some problems of the RGB protocol itself in its implementation, allowing the protocol to be implemented.
Nervos is an early project that originally hoped to build a layer of blockchain similar to Ethereum that can carry a wide range of applications, but its operation has not seen much improvement in recent years. It was not until the launch of the Bitcoin ecosystem that the team turned its development direction to the second-layer expansion of Bitcoin based on the isomorphic characteristics of its own UTXO.
UTXO Stack has only recently been exposed in the media. The main benefit is that it has been favored by capital including many institutions, mainly because of its "one-click chain launch" function. However, the goal of this function is definitely not to create more first-layer UTXO blockchains, but to build a second-layer expansion system that is isomorphic to Bitcoin.
On the whole, we can understand this ecosystem as follows:
Around Bitcoin, it provides a complete set of infrastructure, allowing users to issue assets (based on RGB++), build applications (based on CKB), and customize their own second-layer extensions (UTXO Stack).
In this ecological framework, UTXO Stack is a feature that I think distinguishes it from other Bitcoin ecosystems.
We all know that Ethereum already has a fairly mature “one-click chain launch” system, such as the toolkit for issuing second-layer extensions provided by Optimism - Base is implemented in this way; Arbitrum provides a toolkit for issuing third-layer extensions - such as XAI and the recently popular Degen Chain.
However, in the Bitcoin ecosystem, the current second-layer expansion systems are basically fought alone and need to be reconstructed by teams one by one. There is no "one-click chain launch" toolkit similar to the Ethereum ecosystem. In my opinion, UTXO Stack seems to be the first project in this field in the Bitcoin ecosystem.
Overall, the design of this ecological framework is technically good and innovative.
CKB data: The current total market value is 7.683 billion, and the top 100 holdings account for 95.07%
Technical aspect: grasp the entry and exit timing from the trading volume
Weekly chart: After CKB fell below the issue price in early May 2022, it has experienced a 20-month bottom-shrinking adjustment. In addition, it has been falling all the way since November 2021, with a drop of more than 90%, constantly creating panic and eroding the faith of holders, prompting them to hand over their chips.
Daily line: The trading volume on January 30, 2024 was 9.424b. Before that, the trading volume was maintained at around 150m, which was in the safe zone of the currency price (safe zone: the trading volume does not change much each time, and the currency price does not fluctuate much). The trading volume suddenly expanded by 62.8 times, and the currency price increased by 22.48% on the same day. CKB has since entered the purchase zone (purchase zone: the trading volume is enlarged, several times greater than the safe zone, and the currency price does not increase much). For friends who can understand the intentions of the dealer, this is the best time to buy, avoiding the previous adjustment stage and shortening the holding time.
Danger zone for currency prices: trading volume continues to expand, and the currency price rises sharply on the day and then falls back, and trading volume shrinks in the later period.
Coin price delivery zone: The dealer frequently competes at high levels to attract retail investors to chase the rise. The trading volume is enlarged again, but it is smaller than the danger zone, and the coin price is about to fall.
For the risk zone and delivery zone of the currency price, you can compare the CKB daily trend chart to make a detailed understanding and leave a message in the comment area to communicate.
