What is Chia Network?
“We believe that chia, a new digital currency built on our new blockchain with radically different features and security than other digital currencies, will ultimately deliver on the promises of ‘magic internet money,’” the company asserted in its first version of a new business white paper.
So what is Chia and how does it work?
Chia was founded in August 2017 with the aim of creating a better blockchain and smart transaction platform. The Chia Network is being built to develop global financial and payment networks. Chia will be the first digital currency designed for businesses. Since Bitcoin, Chia is using the first modern Nakamoto consensus algorithm. Bram Cohen, the greatest network protocol programmer alive and the inventor of BitTorrent, created Proof of Space and Time. Chialisp is an efficient, easy-to-audit, and safe smart transaction programming language from Chia. Atomic swaps, registered payees, recoverable wallets, multiset wallets, and rate-limited transactions are instances of smart transactions currently available.
PoST works by filling up unused computer storage space with strings of digits that farmers (or “blockchain validators,” as Chia refers to them) agree to load on their computers. The more room and strings they have, the better their chances of winning a block are. Chia claims to be “the easiest cryptocurrency to validate for normal people ever.”
Bitcoin bulls obsess about the hard limit, but Chia argues that what matters is a predictable number, not a set amount. Chia does not have a limit, but it will not surprise holders with unexpected emissions. The white paper claims that “being able to directly quantify a mutual expectation of total supply at any given time provides much the same financial and peace of mind value.” As previously mentioned, the company will launch the mainnet with 21 million XCH, a nod to bitcoin, and farmers will be able to earn them immediately. Though farming will take 21 years to double supply, the company believes it will be very similar in just six years. The coin-structure of favoring an infinite supply is similar to Dogecoin.
Miners in China are reportedly desperately snatching up every hard drive and SSD they can find in the wake of the Chia cryptocurrency’s launch. Chia uses a proof of space and time model, unlike Bitcoin, which is based on proof of work. Chia is said to be an environmentally friendly cryptocurrency. Chia was founded by Bram Cohen, the founder of BitTorrent, to take advantage of the free space on storage devices. Chia is based on the idea that hard drives and SSDs use less fuel, are easier to come by, and are less expensive to buy. Mining Ethereum or Bitcoin on a large scale, on the other hand, adds to the loss of energy.
Miners are mass-purchasing hard drives with capacities ranging from 4TB to 18TB, according to the HKEPC study. Panic buying would eventually result in a hard drive shortage and price increases. Hard drive and SSD prices in Hong Kong are forecast to rise between 200 HKD and $600 HKD ($26 to $77). User SSDs aren’t the best option for growing Chia because of the constant read and write operations. When there’s money to be made, though, nothing is safe from miners.
FAQ — Chia Network. (2021). Retrieved 20 April 2021, from https://www.chia.net/faq/
5 Takeaways From Chia Network’s New White Paper — CoinDesk. (2021). Retrieved 20 April 2021, from https://www.coindesk.com/5-takeaways-from-chia-networks-new-white-paper
Hard Drive and SSD Shortages Could Be Imminent If New Cryptocurrency Blooms. (2021). Retrieved 20 April 2021, from https://www.tomshardware.com/news/hard-drive-ssd-shortages-imminent-if-new-cryptocurrency-blooms
Takahashi, D. (2019). Chia Network creates a $100,000 contest to bolster its cryptocurrency platform. Retrieved 20 April 2021, from https://venturebeat.com/2019/07/09/chia-network-creates-a-100000-contest-to-bolster-its-cryptocurrency-platform/