What Is Enigma (ENG)? Is Enigma (ENG) a Good Investment?
The investment companies brought Bitcoin to Wall Street, whilst Enigma will probably be the next Bloomberg. Why is everyone talking about Enigma? What is Enigma (ENG)? Enigma has a great underlying technology and the team is striving towards strong partnerships in the crypto space. Is Enigma (ENG) a good investment? Read on to find out.
Disclaimer: This article should not be taken and viewed as investment advice, but only information and opinions. This article is for information and illustrative purposes only.
What Is Enigma (ENG)?
Catalyst, is an investing platform combined with an off-chain decentralized exchange protocol. The platform was created by an MIT-bred company called Enigma. Catalyst was created by a team of MIT graduates and researchers, based on the research work laid out in the Enigma whitepaper.
The Catalyst protocol is a second-layer, off-chain network that aims to solve the two biggest problems for blockchains: scalability and privacy. By enabling secure, decentralized data computation and exchange, Enigma allows blockchains to truly fulfill their powerful promise.
Almost everyone knows what Bloomberg is. The Bloomberg Terminal is a financial interface which allows professionals to monitor real-time data of the financial market, also enabling them to place trades on the electronic platform.
Enigma Catalyst is simply the crypto version of Bloomberg. Through the Catalyst program which Enigma is currently developing, they hope to replicate that interface in the cryptocurrency scene.
Investing in a popular coin is like embarking on the exciting journey of rewards and regrets. With ups, down, and whales standing their ground, the crypto-market can be extremely volatile. Of course, every time when someone wins a deal, someone somewhere is losing it. But, what if algorithms and machines weigh in to guide us through? The developers of Enigma also saw the rise of cryptocurrency and realized there was an opportunity for algorithmic crypto-asset trading.
To provide a good guidance in trading, historical data is no doubt essential as the past can predict statistically what is going to happen in the near future. This is what exactly Enigma is trying to solve.
The objective of the project is to provide crypto-relevant data and research tools for quantitative traders to build, test and master investment strategies. It has two core components, which will be built sequentially over the next three years. These are:
- A Quant-trading platform which enables quants to be built and master trading strategies created using relevant crypto-financial data from day 1 (Enigma creates the initial data sets).
- A data marketplace for crypto-financial data which enables community participants (companies with data and data crawlers) to offer valuable data sets to the quants in exchange for Catalyst tokens.
How Enigma Works?
Keeping data on blockchains can oftentimes be expensive, and is often public. Enigma plans to bring cheap and private data to the blockchain through what they call secret contracts. Secret Contracts are Enigma’s version of smart contracts, where data stored on the blockchain is kept encrypted and private, while still being able to be interacted with.
Nodes on the enigma network are able to prove that computations and processes are done correctly, without revealing the sensitive information that could lie inside.
It is also worth mentioning that Enigma will become a data marketplace. This marketplace will allow its users to monetize any sort of data while ensuring that the person who owns the data maintains ownership. Enigma calls this issue data escape.
In other words, Enigma aims to put us back in control of our data and allow us to make profits from it. Through this, Enigma allows traders to create their own hedge funds on Catalyst. And crypto-investors will pump in liquidity into the most profitable and successful hedge funds on the platform.
Not only that, Catalyst can be implemented to top crypto-exchanges like Binance, Bitfinex, Bittrex, and Poloniex.
What Is It Trying to Solve?
When companies buy data from data brokers, they must rely on the data being accurate and reliable. However, because this data has often being collated from many different sources to create a profile of an individual, it can often be inaccurate as the different sources can provide contrasting information.
In fact, because data often doesn’t have a name attached, data brokers use computer models to predict how likely it is that two profiles gathered from different sources are from the same person. This can lead to profiles of different people being added together which results in an entirely fake profile.
With the Enigma protocol, users will be selling their data directly. Therefore, data purchasers can be confident that this information is 100% accurate and reliable.
Currently, we don’t own our data. Data brokers gather our data from questionable sources and sell it on for profit.
Enigma aims to put us back in control of our own data so we can choose which data we wish to sell and which we wish to keep private. From the data that we wish to sell, we make profits instead of data brokers.
Data brokers collect our data and sell it to companies. As a result, the data brokers and companies they sell to are able to see personal information about us.
Through Enigma’s use of ‘secret contracts’, the secure multi-party computation will drive the privacy. It achieves this by avoiding a trusted third party and splitting it at the same time across various nodes. By splitting the data, nobody actually has access to the complete dataset. Inherently, that suggests immediate privacy.
Blockchains carry a lot of data. The sheer data size the blockchain’s ability to manage it automatically prevents scaling. Engima’s technology instead doesn’t perform a replication on the entire data set. Instead, the technology uses a small portion to replicate. In doing so, only certain nodes are affected. Evidently, this new process is much quicker as it requires fewer data.
Is Enigma (ENG) a Good Investment?
Taking the example of Bloomberg, it amassed a yearly revenue of $9.4 Billion as a company collating and presenting financial data just in 2014 alone. This demonstrates the potential size of the Catalyst marketplace.
However, Catalyst is going to be more than just that. Catalyst will also be operating in a similar field, this could just be the first of many applications built on top of Enigma. The potential market is virtually limitless with data fast becoming one of the most valuable resources in the world.
Enigma has a relatively low amount of coins available. The low coin provides you with an opportunity to invest now, and gain later. If the price continues to grow, so does the investment. This can create a domino effect as the coin will become more valuable, hence further driving up price and market cap.
At the time of writing, it may take some time before we see that a fully functional product. However, they have been at least rolling out Catalyst as an early and tangible proof of concept.