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Coin Reviews

Lisk Coin SWOT Review | Everything You Need to Know

By February 27, 2018 April 9th, 2019 No Comments

Lisk is a blockchain platform that allows other developers and projects to build upon it. In today’s post, we’re going to take a detailed look into Lisk and its business model by performing a Lisk Coin SWOT review. As a standard business practice, a SWOT review entails studying the strengths, weaknesses, opportunities, and threats of a particular business model. It’s a great way to get a nice overview of a coin you might be considering.

What is Lisk (LSK)?

With a unique blockchain ecosystem for decentralised applications (DApps), Lisk has been in development since May 2016. Using Javascript as its programming language, each DApp gets its own ‘side chain’ which is linked to the main Blockchain. Due to this feature, the project is able to allow for scalability and flexibility. Much like Ethereum, the Lisk platform will allow DApps to create their own cryptocurrencies, analogous to ERC20 tokens.

Some of the basic features of the Lisk platform include the following:

  • Much like Bitcoin, Ethereum, Litecoin, and others, Lisk will operate on a public blockchain. Essentially, all of these offer block explorers, allowing anyone to view transactions and other information occurring on the network. To see a history of transactions, simply visit Lisk’s block explorer.

Image of Lisk block explorer as it relates to Lisk Coin SWOT Review

 

  • Lisk will use delegated proof of stake as its consensus mechanism, essentially allowing holders of the tokens to become active delegates. Each delegate is rewarded in Lisk tokens for confirming blocks.
  • The Lisk token can be classed as a utility or functional token. Its primary purpose is not to be used as a cryptocurrency, but as a mechanism or access token for developers to use the Lisk ecosystem.
  • By using the Javascript programming language, rather than developing their own, Lisk opens up to the approximately 500,000 Java developers across the globe.

Now that you have a general idea about what Lisk has to offer, let’s get straight to the SWOT coin review.

Lisk Coin SWOT Review

Strengths:

  • Lisk is an ecosystem, where the strength of the platform will grow over time as more DApps are built upon it.
  • Its unique blockchain architecture allows Lisk developers to fully customize their own blockchains or ‘sidechains.’ In contrast, DApps using the Ethereum platform must use Ethereum.

Image with explanation of side chains for Lisk Coin SWOT Review

  • This unique architecture will allow Lisk to be scalable in the future as more DApps are built on it.
  • The platform has been in development for nearly 2 years, which is a long time in cryptocurrencies.
  • By using Javascript as its programming language, Lisk enables half a million global Javascript developers to work and build using the Lisk Software development kit.
  • Lisk’s Delegated Proof of Stake consensus mechanism is a low energy and low resource method of confirming transactions, as compared to Proof of Work system used on the Bitcoin Blockchain.
  • Lisk uses a Schnorr signature-based scheme, which is said to allow faster, more secure transactions, potentially allowing up to hundreds of thousands of transactions per second.
  • The Lisk Nano wallet is simple, clean and easy to use. When I tried transferring LSK, it took approximately 1-2 minutes to arrive, which is very fast.

Image depicting Lisk Nano wallet features for the Lisk Coin Swot Review

Additional Lisk Strengths – Technology:

  • Lisk runs on a permissionless public blockchain, allowing anyone in the world to view transactions on the Lisk network at any time.
  • Lisk has a strong team of 28 staff, many of which are developers, engineers, and strategists. The team has country ambassadors ready to help promote Lisk in foreign countries, another big positive.
  • The Lisk team has been transparent. During the beta stage, they encountered issues but communicated well with their community in blog posts addressing the issues.
  • An extremely strong community is evident including 187K Twitter followers and 30K on Reddit. The posts below attest to the positive community sentiment:

Image of Lisk twitter feed demonstrating community involvement as it relates to Lisk Coin SWOT Review

  • The Lisk tokens are currently 115.6M, which is low in comparison with other DApp ecosystems. The supply of tokens will increase over time via block rewards following a linearly decreasing scale over the lifetime of the network. As a result, an economic incentive for Lisk participants to operate a node is provided.
  • The block reward is 5 LSK and will decrease by 1 LSK every 3 million blocks, occurring about once a year and equating to about a 15.7% inflation rate for the first year. Node operators will also get a share of the transaction fees.

Long Term Lisk Strengths:

  • Lisk is open source, meaning anyone in the world can view the source code, critique it, and suggest development improvements.
  • Lisk has had a Github account since February of 2016. Additionally, there are regular, recent commits from a number of developers.
  • The tokens are a requirement when developers wish to build DApps on the platform. On top of that, tokens are the means for all transaction fees. Together, these two uses give a reasonable expectation of token appreciation over time as the Lisk ecosystem grows.
  • The team focused on developing the platform before getting going with major marketing. A brand overhaul was for the 20th of January, 2018.

Weaknesses:

  • The Lisk project has been slower to the market with a working product when compared to other DApp ecosystems like Ethereum or NEO.
  • After 2 years of development, a software development kit is still not available. Because of this, no one can build DApps quite yet.
  • There were some community and investor issues upon notice of multiple delays in the SDK release. It was due for release in 2017.
  • The fees when sending LSK are at 0.1 LSK. At current market rates, this is around $2.60. Basically, the fees are not cheap at all when compared to other cryptos.

Opportunities:

  • Lisk has the opportunity to penetrate the DApp ecosystem market by leveraging its Javascript programming language feature. Another leverage point is the side chain function. Finally, the delegated proof of stake consensus mechanism gives even more pull.
  • Lisk has the opportunity to become one of the top tier DApp ecosystems. If this happens, it gives a high probability for token appreciation to crypto investors over time.

Threats:

  • Until the SDK is available, there is the threat that investor and community confidence may fall. Especially if the team plans on pushing deliverables back further.
  • DApp ecosystems like NEO, which also offer application development in Java, could outcompete Lisk as an ecosystem.
  • Lisk is a newer blockchain model using unique side chain technology. Given that, there’s the threat a system error may occur, potentially disrupting the network.
  • The combination of NEO, Ethereum, EOS, Cardano and IOTA outcompete Lisk for market share.

Summary

Lisk is an exciting project that has been in development for a number of years. Essentially, this shows the team’s commitment to develop and implement a truly superior blockchain architecture platform. The availability of Javascript developers will be a strong leverage point for Lisk as it looks to build its ecosystem for DApps. Be sure to check out all our coin reviews to get the latest on some of the best blockchain projects.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators’ websites before making any decision. Cryptocurrency Australia Media, or the author, may have holdings in the cryptocurrencies discussed.

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