Colin LeMahieu started development of Nano in 2014 under its original name "RaiBlocks". A year later, RaiBlocks was distributed for free through a captcha-secured faucet. On 9 February 2018, Italian greatest cryptocurrency exchange BitGrail announced its Nano hack and eventual shutdown. Users were prevented from accessing assets stored on the platform, which was collectively worth 17 million Nano.

Nano is a digital payment protocol designed to be accessible and lightweight, with a focus on removing inefficiencies present in other cryptocurrencies. With ultrafast transactions and zero fees on a secure, green and decentralized network, this makes Nano ideal for everyday transactions. Nano utilizes the Block Lattice, a data-structure in which individual accounts control their own blockchain. This allows blocks to be added quickly without conflict and sent to the network for confirmation.

The block-lattice data structure means that every account has its own blockchain for storing transactions. Nano is the first cryptocurrency to use a directed acyclic graph data structure, by having a "block" consisting of only one transaction and the account's current balance.

Consensus is reached through an algorithm similar to proof of stake named Open Representative Voting. In this system, the voting weight is distributed to accounts based on the amount of Nano they hold; accounts then freely delegate this weight to a peer (node) of their choice. No mining of cryptocurrency is needed.
Every block must also contain a small, user-generated Proof-of-Work value which is a Quality-of-Service prioritization mechanism allowing occasional, average user transactions to process quickly and consistently. The PoW computation for a transaction typically takes a few seconds on a modern desktop CPU.

Because Nano accounts can freely delegate their voting weight to representatives at any time, the users have more control over who has power with consensus and how decentralized the network is. This is a key advantage to the design of Open Representative Voting (ORV). With no direct monetary incentive for nodes, this removes emergent centralization forces for longer-term trending toward decentralization of the network.