What is the Waves protocol? How to buy WAVES (2021)

By Daniel Phillips

Despite there being literally hundreds of different blockchain implementations, few have managed to strike just the right balance between accessibility, feature-set, and usability.

Waves is one of the exceptions, taking a fair stab at all three with its ultra user-friendly blockchain solution built to power the future of Web 3.

What is Waves?

Waves is a blockchain platform that makes it easy to create custom crypto tokens (known as smart assets) and launch smart contracts that power a range of decentralized applications (dapps).

These smart assets can represent practically anything, including real-world assets and other cryptocurrencies, and can be bought, sold, used, and traded within the Waves ecosystem.

Since completing an initial coin offering (ICO) in April 2016 and launching months later, Waves has grown to become one of the top 100 most successful cryptocurrencies, and currently has a market capitalization of almost $700 million.

How does Waves work?

Like most cryptocurrencies, Waves operates on a decentralized ledger known as a blockchain. This is secured by a novel consensus mechanism known as Leased Proof of Stake (LPoS) which is essentially a modified version of proof-of-stake (PoS) that allows lite wallet users to help participate in the block validation process by leasing their WAVES tokens to mining nodes (A lite node is a type of cryptocurrency wallet that doesn't need to download the whole blockchain to operate—unlike a full node).

By leasing WAVES to a mining node, these users then earn a fraction of the block reward if their chosen node is selected as its validator.

Much of Waves' power comes from its Smart Assets, which are essentially tokens that have additional functionality thanks to asset scripts. These can give these Smart Assets a range of intriguing characteristics, such as being non-transferable if it reaches a particular address (burned) or freezing once the Waves blockchain reaches a certain block height.

Creating a Smart Asset on Waves is as simple as using the 'Issue Transaction' feature, setting a few basic parameters, and paying a 1 WAVES fee to launch the token from your account.

What’s so special about it?

• 🏃 High-throughput - The recently launched Waves-NG mainnet is capable of handling around 100 transactions per second (tps), compared to a max of 7 tps for Bitcoin.
• 💰 Low transaction fees - These can be as low as 0.001 WAVES for regular transactions or 0.005 WAVES for transactions that invoke a script.
• 👪 Ultra inclusive - Waves' Leased Proof of Stake (LPoS) consensus mechanism ensures anybody with WAVES tokens can earn rewards by leasing their tokens to mining nodes.
• 🧠 Smart tokens - Waves' smart tokens can be launched by anybody since there's no programming experience required. Creating a token on Waves is as simple as a few button clicks.

What can you do with Waves?

As previously touched on, the Waves platform can be used to build and launch complex decentralized applications (dapps), which can be designed around practically any use case.

As of January 2021, the majority of popular Waves dapps are games and gambling platforms, while the number 1 dapp is Waves' own Neutrino Protocol (discussed later).

Most popular waves dApps are either games or gambling platforms. (Image: DappRadar)

The Waves token also has several functions, but today it is most commonly used for trading on the Waves Exchange platform and on third-party centralized exchange platforms.

What is the Waves Exchange?

The Waves Exchange (formerly Waves DEX) is a fast and secure decentralized trading environment for Waves-based assets and other supported cryptocurrencies, like Bitcoin (BTC) and Litecoin (LTC).  This includes a range of Neutrino-powered fiat stablecoins, such as EUR Neutrino (EURN) and GBP Neutrino (GBPN).

Billed as the world's "safest cryptocurrency exchange" and "fastest DEX", Waves Exchange does not require users to hand over custody of their assets when trading and has extremely low transaction fees—at just 0.003% per filled order.
Besides simple cryptocurrency trading functionality, Waves Exchange also allows users to stake a range of assets to earn a variable APR and offers a credit card purchase feature for Bitcoin (BTC) and USD Neutrino (USDN).

What is the Neutrino Protocol?

Neutrino Protocol is Waves' flagship decentralized application and currently the most popular dapp on Waves by a long margin.

It's a protocol designed to allow users to easily issue stablecoins and other synthetic assets. These most commonly include stablecoins pegged to fiat currencies, including the US dollar (USD Neutrino), Japanese yen (JPY Neutrino), and Pound sterling (GBP Neutrino).

Unlike regular stablecoins like USD Coin (USDC) which are directly collateralized with the underlying fiat, Neutrino synthetics are collateralized with crypto assets like Waves tokens.

To protect against volatility, these must be overcollateralized with WAVES tokens.

Neutrino Protocol also powers a feature known as 'Decentralized Forex', which is essentially the decentralized trading of the price stable assets that are enabled by the Neutrino Protocol. This can be accessed via the aforementioned Waves Exchange.

Where and How to Buy Waves

As one of the older altcoins, Waves is already available to purchase and trade on well over 100 different exchange platforms.

Arguably the simplest way to buy WAVES is by using Changelly. Here's how.

Step 1: Head over to the Changelly home page, select the exchange option and select choose payment asset from the top drop-down menu.

Select WAVES from the bottom drop-down menu and enter the amount you wish to purchase.

Step 2: When you're happy with the amount and exchange rate shown, click 'Exchange now'.

You'll then be asked to enter your wallet address. After doing so, click the check box below and then click on 'Next step'.

Step 3: You'll then need to register for an account on the subsequent page, or log in if you already have one.

Step 4: In the final step, you'll be provided a deposit address. This is where you send your payment to (in the cryptocurrency you selected earlier).

Once it has been received and processed, you'll receive your WAVES to the wallet address you supplied in an earlier step.

Note: It's worth checking the terms and conditions of any platform you use before trying to purchase WAVES, since some regions may be restricted.

The future

A recent blog post by Waves founder Sasha Ivanov sheds some light on the platform's future ambitions.

Some upcoming updates for the platform include modifications to the Ride programming language to boost its DeFi capabilities, launching lending pools on the Waves-powered liquidity pool Swop.fi, and launching synthetic assets tied to Bitcoin and stocks via the DeFo protocol.

There are currently no concrete dates for these upcoming developments, but they're all slated to launch some time in 2021.

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