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Oh My God! The Story of OMG Network

06 October 2020 11:22, UTC
Oh My God! The Story of OMG Network
By Bogdan Vinogradov

The funny name OMG Network (OMG) conceals a serious corporate project . Why did it change the name and what to expect from the network — let's try to find out in this article.

The OMG Network was originally called OmiseGO and was a spin-off of the traditional Thai payment system Omise, launched in 2013. ICO OmiseGO was held in 2017 and raised $ 25 million. Shortly after, the developers conducted an airdrop, where the Ether owners could participate — thereby demonstrating the focus on working with its users.

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However, at the time, OmiseGO was positioned as a platform for decentralized work with virtual and fiat currencies. As conceived, it provided the opportunity for financial transactions between platforms directly, both cryptocurrency and traditional ones like Visa, thereby replacing the usual banking system. «Unbanking the banked» was the slogan of the project then.

What's in a name?

But the development of OmiseGO did not stop there. On the contrary, over time, the cryptocurrency became the main product of the company, developing towards Ethereum scaling. By the way, Vitalik Buterin himself took part in this process, acting as a consultant for OmiseGO. The closed beta test of the mainnet began in 2019, and on June 1 this year, the open testing started. In the same period, the transformation of the project's image was initiated.

OmiseGO rebranded into OMG Network on July 1st. Earlier this process was carried out by the company itself, having turned from Omise to SYNQA. In a press release, the developers said they love the old name, but at some point it simply ceased to reflect the essence of what is happening. In addition, the crypto network was too often confused with the ordinary Omise payment system, which created confusion.

Sometimes the name change takes place to get rid of a bad reputation — but it seems that this is not the case, and it is indeed a new commercial positioning of OMG Network purely based on its technical innovations.

Subsidiary

The best characteristic of OMG Network is the term "sidechain." This is the name of the child-blockchains that connect to the main network — in this case, to the Ethereum blockchain. It scales the work with ERC tokens using batch transactions through smart contracts. Thus, transactions are not only significantly accelerated, but also become more profitable due to lower fees and transaction time — a long-standing problem for Ethereum, which both its competitors and Buterin himself tried to solve.

All this is achieved by using the More Viable Plasma technology, based on the Plasma "etheric" lightning network. Thanks to the latter, it became possible to connect sidechains to the Ethereum network in general. A large number of transactions combined into one block, which is approved by a decentralized network of validators within the framework of the Proof-of-Authority consensus algorithm, is conducted through the system at the cost of a single transaction.

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It cannot be argued that OMG Network is the only solution of this kind. For example, zkSync sidechain plays a similar role. But the brainchild of SYNQA interested quite large players, which allowed it to come to the fore. In particular, we are talking about a partnership with a large South Korean bank Shinhan, established in 2019. Then, at the end of June 2020, it became known that the company had managed to raise as much as $ 80 million. The investors were large Asian banks, financial groups, and influential companies like Toyota Financial Service.

In May of the same year, the Omise token was added to the major American exchange Coinbase, which also caused a significant increase in its rate. But, perhaps, the biggest news for this project is the integration with the popular stablecoin Tether (USDT), the value of which is pegged to the US dollar rate. However, in January, Omise's own GO.Exchange closed — but, as is commonly believed, this happened due to a change in legislation in the European Union.

What about the price?

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It is worth noting that, unlike the popular DeFi projects, the OMG course never reached the heights of the "blessed" 2018. Then, at the peak of the price, it was more than $26 per token, while at the start, a little more than half a dollar, was given for it. At the time of this writing, the rate is $ 3.2 — while in March, it dropped to $ 0.55. The growth is impressive but not phenomenal. The same can be said about the prospects of the project. Due to massive investments in Asia and integration with the Ethereum, there is hardly anything threatening OMG Network now. However, it will also hardly be able to do better than the parent blockchain.

Image courtesy of CoinCodex



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