In China, the new cryptocurrency Chia Coin is becoming extremely popular. Unlike Bitcoin or Ethereum, which are mined by the power of a processor or video cards, this new cryptocurrency is mined on hard drives and SSDs.
Chia Network blockchain developer Bram Cohen conceived Chia Coin as a counterweight to other cryptocurrencies that use too much electricity.
The peculiarity of this cryptocurrency is that it is mined on hard disks (HDD) and SSD drives, making Chia Coin more energy-efficient and environmentally friendly than other cryptocurrencies, such as Bitcoin or Ethereum, which are mined using video cards.
Compared to video cards, hard drives only consume up to 30 watts (W), and SSDs are even less. At the same time, video cards of average performance, most often used for mining bitcoin and other cryptocurrencies, consume about 200 watts, which makes their mining more energy-intensive.
However, those miners who want to switch to Chia Coin will have to spend money on buying new hardware — SSDs or HDDs. When mining Chia Coin, miners prefer to use high-performance server SSDs of large capacity since the user will need about 10TB of free disk space to mine it, which is more expensive than regular SSDs. Also, mining Chia Coin needs a faster internet connection.
Because of this, miners have already started buying hard drives and SSDs, which led to a shortage of them. A deficit has already appeared in Hong Kong: their main stock has already been sold out, and the average cost of such hard drives has tripled.
Chia Coin idea and implementation
The name of the Chia project matches the name of the chia plant, which plays an essential role in healthy eating. Founder Bram Cohen developed the Chia blockchain intending to create a more cost-effective solution than Bitcoin. This is due to the concept of farming, used both in agriculture and cryptocurrency mining.
How space and time-proof works
Whereas in PoW, the user must prove the work he has done, in PoS, the stake is made, PoT in conjunction with Proof-of-Space implies proof of free hard disk space. The network’s overall security is enhanced by the consistency between proof of space and proof of time.
Features of the algorithms
Proof of Space. Users, using special software, “seed” the space with sets of cryptographically encrypted numbers. This process is called plotting, and individual areas of space are called rafts. When the network issues a task that needs to be completed to create the next block, farmers scan their plots and look for a hash suitable for solving it. The probability of winning is determined depending on the percentage that occupies the userspace compared to the total space of the network.
Proof of Time. It takes a certain amount of time to transfer data from one block to another. Verifiable latency minimizes power waste and also eliminates the possibility of taking advantage of the parallel use of multiple parallel devices.
Compared to other crypto coins, Chia Coin runs on a more decentralized and, therefore, more secure blockchain. Smart transactions on the network are programmed in the new Chialisp language, which also facilitates auditing.
Technical and economic features
Despite some similarities to Bitcoin, Chia’s code is written from scratch and does not use the Bitcoin codebase.
To reduce the volatility of the coin, Chia will use the strategic reserve created as a result of pre-farming. The developers set the following areas as their goals: creating an ideal blockchain for deploying applications, creating the first publicly-traded cryptocurrency close to ETF, stimulating adoption in corporations and among end-users.
The project does not plan to conduct an ICO. Instead, it will go to the stock exchange — it will conduct an IPO that meets the requirements of the SEC.
Some users have already called Chia Coin “the second Bitcoin.” This cryptocurrency will also be able to perform the functions of exchange, purchase of goods and services, and accumulation. However, the developers have made efforts to make these processes as easy as possible to make operations faster and cheaper.
At the moment, many members of the crypto community see Chia as the excellent potential for earning money, rushing to get as many coins as possible while they have not yet entered a lot of crypto exchanges. The Chia Coin price has not yet been determined, but we might say that the potential is very good.