What is Safex? - Detailed Explanation

Read the detailed report about Safex. In this text, we are explaining what is Safex Marketplace, Safex Token, Safex Cash, Safex Blockchain, and Safex Wallet.

What is Safex? - Detailed Explanation

In the previous text, we briefly explained What Safex is. In this one, we will go in-depth and explain it in more detail. As you know, Safex is a blockchain technology and eCommerce platform. Safex is cryptocurrency and software. You might hear someone wanting to list a product for sale ‘’on Safex’’, and someone else asking about the ‘’price of Safex’’. Keep in mind that project Safex is a complex project. However, it’s not difficult to understand. Let’s eliminate all the confusion.

Briefly, Safex Marketplace is an eCommerce platform and the main reason for Project Safex to exist. Safex Blockchain is an engine for this eCommerce platform. Safex cryptocurrency: Token and Cash are irreplaceable in this ecosystem and are a utility token and medium of exchange, respectively. TWM Wallet is the first commercial eCommerce wallet related to this project.

Safex Marketplace

Safex Marketplace is a decentralized eCommerce platform where you can buy and sell goods and services. This Cryptocurrency Marketplace is built upon its own blockchain, which means selling on Safex Marketplace is the same as buying/selling goods or services in person. The explained vision behind Safex Marketplace you can find here.

The Marketplace itself is a broader term than just the TWM Wallet. However, a Wallet is the interface for one to use Safex Marketplace: to buy or sell goods and services. Safex Marketplace is the reason why Safex Blockchain exists, as well as its cryptocurrencies. Safex Marketplace is the reason why the Safex community is gathered and why Safex software is built. Safex Marketplace is the core around which all is built, and which can be seen through the Safex Wallet.

The Safex Marketplace uses a suite of advanced eCommerce functions that have been baked-in to the Safex blockchain protocol. Users can perform all the necessary actions of buying and selling goods/services by simply and cheaply sending the required blockchain transaction:

  • Create/Edit a Merchant Account
  • List/Edit a product/service for sale, either directly for a set amount of SFX, or pegged to a price oracle, such as USD
  • Purchase a product/service
  • Send Feedback about a previous purchase experience

Because the Safex Blockchain utilises ring signatures and one-time addresses, and thus protects users wallet balances and transactions from public scrutiny, both buyer and sellers can complete their transactions without revealing unnecessary information about the contents of their wallet balances, and any other transactions they may have made. (Just like the local supermarket doesn't get to access your bank account balance or see the other transactions you’ve made with your debit card, when you use it to pay for your groceries. And likewise, you don't get to see the account balances and other transactions of the supermarket.)

In addition to the blockchain protocols, a complementary API-layer allows for the curation of approved Merchants and their listed items in the TWM Wallet, and also provides an encrypted messaging system, which utilises RSA-4096 encryption and creates a new messaging instance between the buyer and seller for every purchase.

As both the Safex blockchain and the API software are open-source, any other entity can use them to create their own individualised Wallet interfaces to the Safex Marketplace, should they choose to do so.

Blockchain Genesis

In order to seed the network with activity and be able to cover fees for the initialization of the marketplace, 1% of SFX (10 million SFX) was premined at the genesis block.

  • 5 million SFX were set aside for a future development fund.
  • 5 million SFX were allocated for airdrops with migrated SFT, at an approximate ratio of 0.0023 SFX per migrated SFT (specific rate: 5,000,000/ 2,147,483,647)
  • Migration of the original 'placeholder' Safe Exchange Coin (BTC/Omni Token) to SFT at a ratio of 1:1

Safex Blockchain

The Safex Blockchain's Proof of Work mining is based on the latest customized RandomX mining algorithm - RandomSFX, which limits mining to CPUs with high amounts of L3 cache, mainly AMD Ryzen series CPUs. This allows people to easily mine SFX with their home PCs whilst simultaneously adding hash rate to the network and increasing its sovereignty and security.

  • Block time: approximately two minutes
  • Difficulty retarget: every block (based on the last 60 blocks (2h))
  • Block size: dynamic, double max size is the double value of the median for the last 100 blocks.

Besides the RandomSFX algorithm being egalitarian, the distribution of the SFX currency also follows an innovative emission model where the block rewards follow an S-shaped emission curve. This was evaluated by an Economist, Ivana Todorovic, who deduced that a steady monetary distribution would enable a stronger network effect since technologies are adopted over time rather than all at once.

The premise is that more people know about bitcoin now than when the block reward and mining were possible by a normal person, so why is the supply severely cut off now? This led the team to discover the Diffusion of Innovation Theory by Everett Rogers, and they thus applied a coin emission curve that could match up to what is possible to expect for the rate of adoption.

Safex Cash: Diffusion of Innovation Theory by Everett Rogers
Further reading on this theory can be found here.

Safex Coins

Safex cryptocurrency is a 2-coin peer-to-peer marketplace ecosystem. The two coins are Safex Cash (SFX) and Safex Token (SFT). Both currencies can be stored in the same wallet on the same Safex address. Transactions of Safex Token and Cash are private and fast.

Safex Cash and Safex Token

Safex Cash

As at the date of this article’s publication, there are 105,578,983.24 SFX in circulation. However, this number grows with every block mined, and the current total can be found at block explorer. Here are the top characteristics of Safex Cash:

  • Safex Cash is a medium of exchange

SFX is the currency of the Safex Marketplace. All marketplace purchases of goods and services use SFX for payment. Thus, SFX can also be obtained by selling your goods or services on the Safex Marketplace. SFX is divisible to 10 decimal places. 1.0000000000

  • Safex Cash is a proof-of-work mineable cryptocurrency

Safex is a Proof of Work (PoW) consensus blockchain, and mining rewards are paid in SFX. SFX is also obtainable from staking SFT and receiving a share of the sales commission fees from all marketplace purchases.

  • Safex Cash emission is defined by an S-curve

Safex Blockchain has a 1 billion SFX S-shaped emission curve over a 20-year period, which increases each year during the first seven years before decreasing each year for the remaining 13 years, with a trailing emission of 3 SFX per block after that. This better decentralizes the coin and makes for a fairer distribution model.

Safex Cash emission curve and monetary base
Safex Cash emission curve and monetary base
  • Paying transaction fee in Safex Cash

SFX is also necessary to pay all transaction fees to the network. Every action that takes place on the blockchain network requires the payment of some small network fee. All blockchain transaction fees are paid in SFX. (Transactions include simple transfers of SFT or SFX, plus all advanced functions of the marketplace: listing/editing offers, creating/editing vendor accounts, creating/updating price pegs, purchasing offers, sending feedback, staking/unstacking SFT, etc.) These transaction fee costs are generally only a fraction of a cent, up to a few cents.

All Safex Marketplace Purchase transactions incur a 5% sales commission fee. This fee goes into a SFX commission pool.

Safex Token

This is the most important aspects of Safex Token:

  • Safex Token is all in circulation already, it is not divisible and cannot be mined.

There are 1,885,974,016 SFT in circulation.

  • Create a Merchant Account on the Safex Marketplace.

SFT is utilized for Merchant account creation, where 1000 SFT get locked for a period of 22,000 blocks (~30 days). This utility functionality was included to reduce the ability to spam accounts onto the blockchain.

A result is a state machine that enables people to create accounts with a pseudonym and submit transactions that store data that would describe a product listing. The price is tied to the blockchain and the purchase transaction type, as well as a price oracle*. A successful purchase also enables the buyer to leave feedback as a rating on the listing and store a comment.

*Note: A Price Oracle updates the native cryptocurrency price to an external entity so a product can be listed in the oracle's currency (e.g., USD) while the blockchain reflects the cryptocurrency price according to the oracle's exchange rate.

The feedback function allows for a merchant’s reputation to be established and protects against 'fake reviews' abuse by limiting feedback to only those people who have actually made a purchase of the specified product.

  • You need SFT if you want to passively earn on the Safex Marketplace.

SFT can be staked on the Safex Blockchain and become eligible to receive a share of the entire commission pool. All SFT that are staked continuously from the beginning through to the end of each 1000-block interval receives a pro-rata share of all sales commissions collected during that 1000-blocks. The sales commission is accrued against the staked SFT and subsequently gets paid out as SFX into a staker's wallet via the Unstake function.

Staked SFT only accrues this revenue share for a maximum of 500,000 blocks (approximately 1.9 years), at which point no further accrual occurs until the staked SFT are unstaked. This limitation exists to ensure that potentially lost wallets don't continually accrue SFX and thus permanently deplete the circulating supply on an ongoing basis.

Safex Wallet

TWM Wallet is the first commercial entity to develop a GUI Marketplace interface using the open-source Safex ecosystem. This Safex Wallet is a cryptocurrency wallet (application) that you need to have to become part of the Safex eCommerce ecosystem. Using Safex Wallet, you can:

  • Send and receive Safex Token and Safex Cash
  • Stake/Unstake Safex Token
  • Buy and sell goods and services - all of that in one Wallet.

After you have installed your Wallet and backed-up and saved your keys, you can see all listings on Safex Marketplace. Every product will have a description, available quantity, and other relevant information and price in Safex Cash (SFX).

Buying products on Safex Marketplace is easier than buying on any other marketplace because you just need to write where products are to be sent and pay from your digital Wallet. Purchases can be completed in one minute.

There is a built-in messaging tool that buyers and sellers use to communicate with each other. Messages are cryptographically secured, and nobody can read your discussion.

Keep in mind: Safex had previous wallet versions which came out under different names, but became obsolete with the launch of the eCommerce functions of the Safex Marketplace. At this moment, TWM Wallet is the only wallet you should use and the only one we can recommend.

Conclusion

Safex Marketplace, Safex Blockchain, Safex coins, wallets and softwares are all part of the Safex project. Safex Community is the one that is powering the whole movement. Don’t forget that the project is still evolving and that software is getting improved, including TWM Wallet. If you want to join this Community and support the Safex ecosystem, you can download TWM Wallet, start mining, and/or set up your own node. If you are a programmer - you can apply for some of the open positions.