What is Nano (XNO)? A feeless payment protocol explained

Nano is a payment protocol and nothing else. It is meant to be accessible and lightweight, and it was built by cutting out the parts of older cryptocurrencies that make payments slow or costly.

What Nano is

The pitch is ultrafast transactions and zero fees on a secure, green and decentralized network. It is pitched as fit for everyday transactions. Send a few cents or a large sum and the network adds no fee either way. The ticker is XNO. Earlier years wrote it as NANO or XRB.

Three design choices carry the pitch (protocol overview). Blocks are minimal, so messages stay small and confirmation is fast. There is no traditional proof of work or mining, so nodes use significantly less energy per transaction than other popular networks. And nodes earn no rewards, so there is no race to become the biggest operator. Nano is low-latency, feeless, scalable and environmentally friendly, and its scalability is not limited by protocol-side variables like block size or block time.

One practical consequence: payments too small for cards, such as a tip or a charge per API call, become workable when the network adds no fee.

Who runs it? No single company controls Nano, including the Nano Foundation. The Foundation is a not-for-profit organisation built by volunteers. Independent representative nodes keep the network online.

Using it for the first time

Nano’s own advice is short: start small. Get a wallet, receive a little nano, then see what you can do with it. Choose a wallet to store, send and receive, back up your recovery phrase and keep it private.

The Nano wallets list shows the wallets nano.org links to. Read Nano scams before you hand an address or a phrase to anyone, then send a first payment. Nano fees explains why it costs nothing.

Where Nano came from

Colin LeMahieu started development in 2014 under the name RaiBlocks, and Nano launched in October 2015. The original paper and the first beta implementation date from December 2014. RaiBlocks was rebranded as Nano in 2018. It is one of the first Directed Acyclic Graph (DAG) based cryptocurrencies.

Nobody mined the coins and nobody sold them in an offering. They were handed out through manual captchas, from late 2015 until October 2017, and what was left of the supply was burnt. The fixed total is on Nano units and raw.

The original whitepaper was last updated in November 2017. The documentation site now carries a Living Whitepaper instead, because a static paper took too much effort to keep current. It has two sections, Protocol Design and Node Implementation, and the second covers methods built into the current node that are not required for compliance with protocol rules.

One early episode was about custody, not the protocol. On February 9, 2018, the Italian exchange BitGrail announced a hack and its eventual shutdown. In January 2019 the bankruptcy division of the Court of Florence declared BitGrail bankrupt and held its owner, not the Nano developers, responsible for the losses.

How a transfer works

Nano does not use one shared chain: every account controls its own blockchain. Money moves in two separate actions. The sender publishes a block debiting their own account for the amount. The receiver publishes a matching block crediting theirs.

Once the network confirms the first block, the funds sit in a receivable state and cannot be reversed. The receiver can be offline and leave them there safely until they are ready to publish the matching block. The sender cannot take them back.

This works because every account has a chain of its own that only its key holder can sign into. Every block records one transaction plus the full account state: account number, balance and representative. Only an account owner can change their own chain’s balance and representative. The block lattice page shows the fields.

Nano is one of the first cryptocurrencies built on a DAG, not a single chain. Because chains are separate, each user updates their own chain asynchronously from everyone else. Nobody waits for leader selection, as in single-blockchain currencies like Bitcoin.

Why there is no fee

Fees normally pay miners or validators for producing consensus. Nano has neither, so there is nothing a fee would fund. Nodes have no direct monetary incentive, and the reasons to run one sit outside the network. Operators run nodes because a working network is useful to them. How Nano works has the full argument and the defenses that replace a fee. Spam is handled differently: every valid block needs a small proof-of-work solution attached, which makes spam costly. Nodes that are not full historical nodes can also prune old transactions from their chain. Wallets, exchanges and other services are a separate matter, and they can still charge their own.

How a transaction is confirmed

Nano uses Open Representative Voting (ORV), described in the ORV consensus design. Representatives that users pick vote on each transaction. Each node then cements it on its own once the votes reach quorum. The default threshold is more than 67% of online vote weight. Open Representative Voting gives irreversible finality. A new node does not vote by default.

Any account can pick a representative at any time to vote for it, even while the delegating account is offline. A representative’s weight is the sum of balances delegated to it. Delegating does not stake or lock anything. The account can still spend all its funds at any time.

There are two kinds of representative. An account needs at least 0.1% of online voting weight delegated to it to become a Principal Representative. The only operational difference is that other nodes rebroadcast a principal representative’s votes, which helps the network reach consensus more quickly. An account with no weight today can still get there over time, because any user can redelegate their weight.

Weight follows balances, so running many nodes does not help an attacker: extra nodes gain no extra votes. Forks are rare for a second reason. Because only an owner can sign into their own chain, a fork means a bug or a double spend by that owner.

Supply, units and the ledger

The supply is fixed. The genesis balance was a fixed quantity and can never be increased, and the sum of all account balances will never exceed it. Figures and the burn address: Nano units and raw. The available_supply RPC reports the current amount.

Balances are stored as a 128-bit integer. The everyday unit is the nano and the smallest is the raw, where 1 nano = 10^30 raw. All RPC commands expect raw. Since blocks record balances and not amounts, the ledger can in principle shrink to one block per account plus pending blocks.

Keys, seeds and addresses

An address starts with nano_, followed by 52 characters that encode the account public key, and the final 8 characters are a checksum that helps catch typos. A seed is 32 random bytes, usually shown as a 64-character hexadecimal string, and knowing it gives access to every private key derived from it. Whoever holds an account’s private key controls that account. One user may control many accounts. Guard the seed above everything else.

Not proof of work, not quite proof of stake

Bitcoin reaches consensus with proof of work, an economic measure in which participants compete to compute a nonce. In proof of stake, participants vote with a weight equal to the wealth they hold. Nano’s weighted voting can be compared to proof of stake, but it differs significantly from the traditional form. No one chain needs a staker or miner to extend it, and representatives never build shared blocks. Anyone can be a representative. No funds are staked or locked up. Users can re-delegate their voting weight to anyone at any time. Block cementing means representatives cannot reverse transactions that nodes have locally confirmed.

Where to go next

Read how Nano works for a payment followed layer by layer, or go straight to how to send Nano. The Basics hub lists the rest of this section, and the GitHub project README points to the node documentation, the RPC reference and the contributor guide.

Our verdictTake Nano's own advice literally: no fee and fast confirmation are easy to check yourself with a small first amount.