Categories: EducationFAQ

What Is Vega?

It is evident a lot of new cryptocurrency-related funding projects are coming to market as we speak. While not all of these ventures will work out in the end, they show there is plenty of room for exploration of new ideas. For its part, Vega aims to become a decentralized system to manage capital. The main focus is on the Ethereum blockchain, of course, as that seems to be the go-to solution for financial projects of this magnitude.

A Public Capital Allocator for Ethereum?

No one can deny there are a lot of innovative projects in the world of blockchain and cryptocurrency. Most of these ideas direly need funding, yet it can be rather difficult to obtain that capital. Not everyone wants to host their own

ICO either, even though it seems that has become the go-to method for raising capital in 2017. Decentralizing the concept of managing capital is not easy, but there are efforts currently underway to change that.

The big question is whether or not any of these concepts can be successful in this regard. Answering that question is anything but easy right now. Most of the projects focusing on providing “public capital” services will first issue its own ICO token, rather than come up with a working product first and foremost. Vega is not all that different, even though it has a GitHub repo and a few demo videos on YouTube to show how they aim to handle things. It is an ambitious plan, to be sure.

According to a Reddit post, the team aims to become a distributed general partnership capable of managing outside capital. That is quite the mouthful of big words strung together, and it doesn’t necessarily mean they will be successful in their venture, to say the least. There will be some form of a decision-making engine based on meritocracy and track record. It is interesting to see them forgo the option of using the wisdom of the crowd, although that decision was seemingly made deliberately.

Related Post

Under the hood, the project aims to use a blockchain to ensure the incentive system is not gamed. Anything that wishes to take itself seriously while focusing on decentralization will need a blockchain that is public, rather than a private solution.  Vega is certainly on track with its decision to utilize Ethereum. Unfortunately, there is a second reason as to why this blockchain was chosen, considering they aim to issue their own digital token which represents equity and control of the network itself. Just about every blockchain project in the financial sector wants to create a new token rather than use existing cryptocurrencies, and that trend will not stop anytime soon.

A lot of people will immediately draw similarities between Vega and The DAO. As we all know, the latter project eventually failed miserably, mainly due to its code getting hacked several times in a row. While a portion of those funds were eventually recouped, it highlighted the insecure aspect of The DAO’s smart contracts and business structure. Whether or not this new project will fare any better in this regard remains to be seen.

In the end, it is commendable to see a fully decentralized venture in the world of capital management. Vega’s decision to use Ethereum also makes sense, although it is not necessarily because their blockchain solution is better. The issuance of yet another token will not necessarily instill confidence right away, as there simply are too many projects with ICOs already. Despite all of that, Vega may yet succeed in the end. It will all depend on whether or not it can succeed where The DAO failed. For now, that question remains unanswered.

JP Buntinx

JP Buntinx is a FinTech and Bitcoin enthusiast living in Belgium. His passion for finance and technology made him one of the world's leading freelance Bitcoin writers, and he aims to achieve the same level of respect in the FinTech sector.

Share
Published by
JP Buntinx

Recent Posts

Topping the Best New Meme Coins to Buy Now: BTFD Leads the Charge!

In a world where meme coins can turn a latte budget into a lambo fund,…

3 hours ago

Best Cryptos to Buy Today: Qubetics Presale Hits $2.7M, MicroStrategy Falls After Bitcoin Price Dips, and Ethereum Heist Involves North Korean Hackers

Best Cryptos to Buy Today: Qubetics Presale Hits $2.7M, Bitcoin Price Dips, and Ethereum Heist…

7 hours ago

WIF Set to Overtake BONK? Lunex Soars with 100x Potential in Altcoin Season

As altcoin season heats up, all eyes are on the rising stars—especially Lunex, which is…

16 hours ago

Binance Coin Price Dips: BNB Holders Rush To Lunex Presale To Hedge Their Long Positions

While the broader market witnessed a notable upward movement, Binance Coin (BNB) experienced a decline…

16 hours ago

Crypto Stalwarts Forecasted 800% Growth in Innovative Projects: VeChain, Rollblock and Polkadot!

This blazing crypto bull run has investors looking for the next top altcoins set to…

16 hours ago

Dogecoin Price Set To Recreate 36,000% Rally From 2021 After Pennant Formation

The Dogecoin price is back in the limelight, captivating the crypto world with its recent…

16 hours ago