Syscoin stands out by merging key features of Bitcoin and Ethereum into one platform. Its layer 1 consensus relies on Bitcoin’s SHA-256 Proof-of-Work (PoW) model, enabling merged mining with Bitcoin. This allows miners to mine both BTC and SYS simultaneously without additional costs. Data indicates that generally over 50% of Bitcoin's hashrate also secures Syscoin, with support from several major Bitcoin pools. The network adds decentralized finality atop Nakamoto consensus, which aims to remove the 51% attack risks typical of PoW while keeping the underlying proven consensus mechanism.
As a modular layer 1, Syscoin supports optimistic and ZK rollups, offering them a censorship-resistant, low-cost data availability service known as PoDA. Rollux, an EVM-equivalent optimistic rollup and a fork of Optimism built by SYS Labs, launched on June 28, 2023, as the first layer 2 on Syscoin. The Rollux ecosystem is the primary focus for growth, aiming to deliver scalability through a fast, low-cost user experience.
In essence, Syscoin’s current technology offers what Ethereum’s modular roadmap plans to provide in the future, including data availability, while maintaining Bitcoin’s PoW security.
The network uses incentivized full nodes, called masternodes, to provide multi-quorum chainlocks for finality. Details on incentives and requirements for running a Syscoin masternode are available at sysnode.info.
Syscoin’s layer 1 architecture is dual-chain and modular (rollup-centric). It includes:
- Network Enhanced Virtual Machine (NEVM): An Ethereum-based blockchain released on December 6, 2021, compatible with Ethereum smart contracts and rollups.
- Syscoin UTXO (or "Syscoin Native"): A Bitcoin-based blockchain that supports Taproot, data availability, a token platform for ordinals, fungible and non-fungible tokens, and a proprietary DAG protocol called Z-DAG.
This design lets users and developers utilize the strengths of both Bitcoin and Ethereum models, creating synergies like PoDA. SYS serves as the native coin for both Syscoin blockchains and Rollux. It is a utility-focused token based on EIP-1559. Holders can move SYS between these chains using the Syscoin Bridge and the Rollux Portal.