Before explaining what an Initial Node Offering (INO) is, we would first like to reiterate that a decentralized system of real work does not have centralized ownership, as it belongs to the people who run it. Companies that create truly decentralized systems hand them over to the public, so they no longer have control over them. Once the system is public and its code is open source, then the project is truly decentralized: the public members who support the funding of the project directly contribute to the development process carried out by the open-source community.
Under this logic, the people who, through INO, bought an NFT that allows them to run a node of the system’s peer-to-peer network, are contributing to the development of the system, but they are also contributing to the system itself by running the network. , creating collective value and strengthening the system, while monetizing the activities of users in the peer-to-peer (P2P) system. In a sense, the INO process helps stabilize the entire system and brings a central idea to a decentralized outcome. Thanks to the INO mechanism, node operators are compensated for the processing power and costs they have allocated to run their nodes in a P2P system, the code is in the hands of the open-source community, and the entire project is public.
What is the key difference between ICO and INO, and why is INO a more ethical alternative to ICO?
In an ICO, developers create millions of coins or tokens out of thin air, inflate their value with promises, sell them in bulk at a cheap price to “whales” who charge quite well, and let the whales dump their coin at a profit. of the expenses of small faithful followers who are not even involved in the process of development and operation of the network. On the other hand, an INO does not focus on tokens or coins and focuses more on technology. Without a real project, an INO has no means to exist, and those who have bought the nodes as NFTs, are directly involved in the operation of the network, while actively contributing to the development through their participation.
Why does INO use NFT?
The reason for using NFTs for the INO is that each NFT represents a precise node in the P2P network, making it unique and, as its name implies, non-fungible.
Each NFT has 3 data that the owner can edit:
- The owner’s account (this is the address to which the revenue collected by the node is sent),
- The unique ID of the node (this is necessary to ensure that no nodes are running duplicates in the system) and
- Up to 100 characters to leave a message recorded in the blockchain genesis block forever.
The NFT smart contract is scheduled with 2 dates. The first date blocks the transfer (or sale) of the NFT and the second date blocks the edition of the NFT. This allows those who have bought in bulk in the private sale and pre-sale, and also at the start of the private sale, to be able to resell some of their nodes generating income, since once the public sale starts, the price of an NFT increases daily.
The NFTs after the INO is complete, are frozen on the host blockchain. They cannot be transferred and can no longer be edited. As the genesis block of the blockchain has the list of the nodes, the frozen NFTs become a mirror of the genesis block of the system to be launched. This guarantees those who later want to run a node and join the blockchain that the node they are running has not been compromised, as the genesis block included in the core software must include the same nodes as those registered in the blockchain. NFT.