NKN is a project that aims to create a fast, private and secure general-purpose peer-to-peer network. The idea is that if you want to create a new p2p app you can build it on top of NKN and not have to worry about reinventing any of the mechanics of p2p.

So far, so good. Decentralisation is fun. NKN is also interesting for another reason though. In the previous post we talked about how blockchains are used to incentivise people to contribute their resources to a network. NKN takes this approach, by rewarding people with NKN tokens for contributing their bandwidth to the network. And it’s working; at the time of writing there are 89,608 NKN nodes.

When a message is routed through NKN each node it passes through adds its signature to the “sigchain”. When the message arrives at its destination one node from the sigchain is chosen and rewarded. At the moment the reward is about 11 NKN.

NKN is not built on ethereum. In order to get the greatest throughput the project chose to implement their own blockchain. However, there is an ERC20 NKN token. Each ERC20 token is worth one token on the NKN mainnet. I imagine this is to incentivise miners, by making it easier to trade tokens. You can buy and sell the ERC20 NKN token on exchanges like Coinbase.

At the moment NKN tokes are trading for about £0.42, which seems quite low for a project with lots of applications and some serious minds behind it. And you can mine them without dedicated hardware. I decided to set up some NKN nodes of my own and see what happens…