OMG Network, formerly known as OmiseGo, is a non-custodial Layer-2 scaling solution built for the Ethereum blockchain. Designed to enhance transaction efficiency, it allows users to transfer ETH and ERC20 tokens far more quickly and cost-effectively than through direct transactions on the main Ethereum network.
The network leverages an innovative scaling technology called More Viable Plasma, which utilizes a sidechain architecture. This approach bundles multiple transactions off-chain into a single batch, which is then verified as one transaction on the Ethereum root chain. This method has the potential to scale Ethereum to thousands of transactions per second (TPS), a significant improvement over Ethereum 1.0's limitation of approximately 10 to 14 TPS.
Powered by its native OMG utility token, the network uses this digital asset for fee payments. Furthermore, the token is anticipated to play a role in securing the network, with users earning rewards for their participation.
The Founders Behind OMG Network
OMG Network was originally founded by the parent company Omise, a well-established payment gateway provider in Southeast Asia. The project was initiated by Jun Hasegawa and Donnie Harinsut. While the OMG Network project itself is now more community and ecosystem-driven, its origins are deeply tied to solving real-world payment and financial scalability issues that Omise encountered.
What Makes OMG Network Unique?
OMG Network’s primary uniqueness lies in its technological approach to solving Ethereum's scalability trilemma—balancing security, decentralization, and scalability.
More Viable Plasma Architecture: This core technology allows for secure, high-throughput transactions by processing them off-chain and then committing a cryptographic proof to the main Ethereum chain. This drastically reduces congestion and gas fees for users.
Focus on Value Transfer: The network is specifically optimized for payments and token transfers, making it a practical solution for exchanges, wallet providers, and other businesses that require high-volume, low-cost transactions.
Non-Custodial Design: Users always retain control of their private keys and funds, aligning with the core decentralized ethos of blockchain while benefiting from Layer-2 speeds.
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OMG Token Supply and Economics
OMG has a fixed maximum supply of 140,245,398 tokens, all of which were created at genesis. This hard cap means no new OMG tokens can be minted, making it a deflationary asset by design. The entire supply is in circulation, which provides transparency and predictability regarding its monetary policy without the uncertainty of future inflation from new token issuance.
How Is the OMG Network Secured?
OMG Network’s security is a multi-layered approach that leverages the robustness of Ethereum while implementing its own mechanisms.
Ethereum Root Chain Security: The network’s core security is anchored to the Ethereum mainnet. The final state of batched transactions is periodically committed to Ethereum, inheriting the full security and immutability of the world's most secure smart contract platform.
Proof-of-Authority (PoA) Consensus: Currently, the network uses a PoA consensus model for its validators. A limited set of trusted nodes is responsible for validating blocks and ensuring the network's integrity. The long-term vision, however, involves transitioning to a more decentralized proof-of-stake (PoS) model where OMG token holders can stake their tokens to become validators and earn rewards for helping secure the network.
Where to Buy OMG Network (OMG) Tokens
OMG is a well-established token and is available for trading on a vast majority of major cryptocurrency exchanges. It can typically be purchased for other cryptocurrencies like Bitcoin (BTC) or Ethereum (ETH), and on many platforms, it is also available for purchase with fiat currencies such as the US Dollar or Euro.
To acquire OMG, you would need to create an account on a reputable exchange, complete any necessary verification processes, deposit funds, and execute a trade for OMG tokens. After purchase, it is considered best practice to withdraw your tokens to a personal crypto wallet for which you control the private keys, especially if you are planning to hold them long-term.
Frequently Asked Questions
What is the main purpose of the OMG token?
The OMG token is primarily used to pay for transaction fees on the OMG Network. Its utility is expected to expand to include staking, where token holders can secure the network and earn rewards for their participation.
How does OMG Network differ from other Layer-2 solutions?
While many Layer-2 solutions like Optimistic Rollups or ZK-Rollups have gained prominence, OMG Network was one of the earlier pioneers using Plasma technology. Its focus has been predominantly on fast and cheap token transfers and payments, providing a specialized scaling solution.
Is OMG Network decentralized?
The current iteration of the network uses a Proof-of-Authority model, which relies on a pre-selected set of validators, making it more centralized. However, the project's roadmap indicates a planned evolution towards a decentralized proof-of-stake system governed by OMG token holders.
Can I use OMG Network for smart contracts?
The network's initial design is optimized for simple value transfers (e.g., ETH and ERC20 tokens) and is not a generalized smart contract platform like the Ethereum mainnet or some other Layer-2 solutions.
What happened to the OmiseGo name?
The project rebranded from OmiseGo to OMG Network in 2020 to better reflect its core function as a scalable network, moving away from its earlier broader branding that encompassed a wider suite of financial services.
Are transactions on OMG Network really cheaper?
Yes, a primary benefit of using the OMG Network is the dramatic reduction in transaction fees compared to conducting the same activity directly on the Ethereum mainnet, especially during periods of high network congestion.