Bitcoin was developed with the aim to provide financial independence to people and is backed by the Blockchain technology – a platform that doesn’t rely on banks, governments or any other institutions. However, with the increase in Bitcoin demand and investor participation, it is becoming difficult to openly participate by anyone in Bitcoin related activities like Bitcoin mining process. Bitcoin mining is now shifted into the hands of the rich who can afford for its expensive hardware.
Also, one of the other important concerns with Bitcoin is that the hardware-intensive mining process consumes a lot of electricity. Experts say that a single Bitcoin transaction requires as much electricity that could power an American house for one week. It was recently in news that the global Bitcoin mining electricity requirements is equal to the electricity requirements of Nigeria.
Legendary coder – Bram Cohen – wants to fix all these issues and has proposed an eco-friendly alternative to Bitcoin. Cohen is the brain behind BitTorrent’s famous peer-to-peer file-transfer protocol. Cohen is currently said to be working on a startup named as Chia Network and is likely to launch Chia Tokens in 2018 via “http://kryptomoney.com/what-is-ico/” target=”_blank” rel=”noopener noreferrer”>Initial Coin Offering(ICO).
Bram Cohen told IB Times :“Running a miner in your house doesn’t make any sense. The retail cost of electricity is so high that your rewards will be less than you spend on electricity.”
By upholding Bitcoin’s original ideas, Chia presents a revolutionary model which is based of “Proof-of-Storage” and “Proof-of-Time” unlike Bitcoin’s “Proof-of-Work”. This means that in order to verify its transactions in the Blockchain, Chia will utilise the cheap and abundantly available unused storage space from Hardrives. Cohen says :
“The idea is to make a better bitcoin, to fix the centralization problems”
With the steep increase in popularity of Bitcoins, there has been a huge mining demand and considering that the total Bitcoins are limited to a 21 million tokens everyone is juggling to get a bigger share. This results into using high-end expensive hardware and burning more electricity. Cohen believes that Bitcoin mining has remained no more a level playing field. The one with deep pockets to afford expensive hardware and pay huge bills will be the ultimate beneficiary.
Just like Bitcoins, with every Chia token being created it will get registered into the history of its Blockchain ledger. Like Bitcoins have Miners, Chia will be having “Farmers” because it is supposed to be greener which doesn’t need more power. To mint every new block, these farmers will have to prove that they have utilised resources pertaining to Proof-of-Space and Proof-of-Time. In exchange, the farmers will get rewards and transactions fees.
The proof of storage concept that backs Chia will allow people having additional space to participate in the farming process with no additional costs. Thus unlike Bitcoin mining which has now been centralized by big insitutions, Chia farming will be decentralized and more eco-friendly.
Early sales of Chia could start by early 2018 but the full launch will take place by the end of that year.
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