What is OMG Network?
OMG is the native token for the OMG Network. It’s a layer-2 scaling solution that aims to optimize Ethereum transactions by offering higher speeds and lower fees. OMG is an ERC-20 token. It’s used as the network’s utility token. It’s notable that the OMG Network crypto structure is not decentralized as it only uses one node to produce blocks.
Over the years, the project underwent several rebrandings. It was initially known as OmiseGo. In 2020, its name was changed to the OMG Network, and in 2021 it became the OMG Foundation. For the sake of consistency, the name OMG Network will be used here. The most up-to-date OMG price statistics can be viewed above.
Who Founded OMG Network?
The OMG Network was founded as OmiseGo in 2017 by Vansa Chatikavanij. Prior to becoming the CEO of the OMG Network, she worked as an environmental researcher, focusing on water resources.
OMG Network was developed to solve some of the key issues experienced by the Ethereum blockchain. Ethereum is one of the biggest decentralized networks in the world. As such, it required a large amount of storage space to maintain the blockchain. Transaction speed is also relatively low, as the network cannot handle as many as 50 transactions per second.
To counter this, the OMG Network was created as a layer-2 solution to improve the network scalability and allow for a significantly larger amount of transactions to be processed simultaneously.
The network officially launched in mid-2017. At this time, the OMG price was around $0.50. It only took a few weeks for the asset value to exceed $10. Its market behavior has been mildly volatile since launch, experiencing frequent ups and downs.
During the first year of its existence, the asset had several notable peaks. The highest OMG price was recorded in January 2018, when it reached $28.35. Since then, the asset has followed the general market trends. In November 2021, a month notable for Bitcoin nearly reaching $70,000 for the first time, OMG peaked at around $20.
How Does OMG Network Work?
The OMG Network coin has a maximum supply which is hard-capped at 140,245,398. Furthermore, all of these coins have already been minted, and no new coins can be added to the protocol. The asset is therefore actively deflationary, as its entire supply is either in circulation or burned. This is expected to positively affect the OMG Network price.
As a layer 2 solution, the OMG Network is fully interoperable with Ethereum. Users can conduct transactions with both ETH and ERC-20 tokens. The platform uses the MoreViable Plasma scaling solution that employs sidechains to conduct off-chain batch transactions, which can later be verified on-chain on Ethereum.
According to the protocol, the OMG Network should be able to handle thousands of transactions per second (TPS). In comparison, Ethereum can only handle a few dozen transactions per second. Furthermore, due to its size and popularity, Ethereum often experiences network congestion due to the exceeded TPS limit.
The OMG Network also works on reducing transaction costs on Ethereum. According to the team, the OMG price to cover the gas fees can be lowered by as much as one-third of the initial price on Ethereum.
As a scalability solution, the OMG Network aims to help make Ethereum more accessible for mass adoption. In addition to reducing transaction costs, it also requires fewer energy resources, making OMG more affordable and environmentally sustainable.
The OMG Network is secured using the Proof-of-Authority (PoA) consensus mechanism. It’s commonly used by private blockchains. An organization that uses the chain chooses the validator nodes. In the case of OMG, there is only one node producing the blocks, making it a centralized blockchain.
The Boba Network
In 2021, after rebranding as the OMG Foundation, the company launched a new blockchain known as the Boba Network (BOBA). Like OMG, Boba is a layer 2 solution for Ethereum. It offers faster transactions for lower taxes. OMG token holders are able to exchange their assets for an equal value of BOBA.
As one of the upgrades from the OMG Network, Boba also enables NFT bridging. This is a process that allows users to easily mint and transfer their non-fungible tokens between the layer 1 and layer 2 chains. It also offers the process called Hybrid Compute that allows developers to build dApps using web-scale infrastructure without on-chain limitations.
In its comparably short run, BOBA has followed similar trends as the OMG Network token. However, the two assets are not pegged to each other, and their value is not interdependent. Generally, the OMG Network price has appeared higher in the markets, although the value of the deflationary Boba tokens is expected to increase over time.