Chia crypto came into our lives for the first time in May of 2021 promising to provide an environmentally-friendly cryptocurrency.
The secret ingredient of this eco-friendly crypto hides in the consensus algorithm which is called Proof of Space and Time.
It became extremely popular by the time it launched, since it offered an excellent competitive advantage among other coins and at the same time it didn’t sacrifice anything on its quality.
As a result, Chia crypto price soared and in just 10 days reached its high price which was 1.329,11 euros!
Of course after the passing of the first enthusiasm the price dropped around 150 euros and it looks that it has been stabilized there ever since July 2021.
Chia Network – A brief introduction
The Chia Network is a company founded in August of 2017 by the American computer programmer Bram Cohen, the author of the BitTorrent file-sharing system.
The company’s innovation is the implementation of a new consensus algorithm focusing on becoming an energy efficient blockchain.
Chia Network is using Chialisp, a programming language designed for security and simplicity and as stated by its creators will make cryptocurrency easier than cash!
In addition, according to the Chia’s white paper there are some built in features making Chia more secure and easy to use;
- Coloured Coins – Allow individuals, financial institutions, corporations, and governments to issue on-chain assets that inherit the smart transaction capabilities of Chia Network’s blockchain and rely upon the globally decentralized secure validation that Proof of Space and Time provides.
- Clawback Escrow – The sender can take back the funds transferred during a specific time period added by withdrawal clawback escrow.
- Slow Paper Wallets – In a Slow Paper Wallet you can store smart transactions that happened in your hot wallet but are not a duplicate of your private key. As a result you are safe if your active (hot) wallet’s hardware is lost or stolen. Additionally if someone steals your Slow Paper Wallet your active (hot) wallet can recognize the situation and redirect the funds transfer to a new wallet you control.
Why is called Chia?
The inspiration for the name came of course from the renowned chia seeds!
The creator, Bram Cohen, tried to find a meaningful name in order to declare the number one priority of the Chia crypto, which is to reduce the energy dependence of blockchains through a “green” option.
Also he wanted a name that is cutchy, amusing and short.
As a result Chia is the name that met all the above criteria!
Proof of Space and Time
Proof of Space and Time is in essence the innovative element that Chia crypto uses to meet its goal which is an environmentally-friendly cryptocurrency.
Proof of Space is a cryptographic technique in which users need to show that they allocate unused hard drive space for storage space.
Now if we combine the Proof of Time with the Proof of Space we have in our hands a very reliable consensus method.
Let’s briefly explain how this consensus method actually works:
- Users (or miners) of the Chia blockchain will “seed” – that’s the term used by the company – unused space on their hard-disk drive by installing software provided by the network, which stores a certain amount of cryptographic numbers on the disk.
- These users are called farmers instead of miners by the Chia Network.
- When the blockchain sets a new challenge for the next block, it picks one of the farmers that has the hash that is closest to the challenge.
- The possibility for a farmer to win the block is the percentage of the total space that a farmer has compared to the entire network.
- That means that every farmer will be rewarded by the blockchain even if he has a very small percentage of the total space on the network.
- That is an amazing advantage over the vast majority of other cryptocurrencies since the Proof of Work mining isn’t affordable for ordinary people!
- Subsequently, Proof of time is implemented by a Verifiable Delay Function and takes a short period of time to pass through the blocks.
- This process of completing a block and moving the chain forward is implemented by one server (called Timelord by the company), which is the fastest among the others competing for the process.
- One more characteristic of the Timelord is that it is safe.
- It is worth mentioning that the use of only one server for the Proof of Time helps electricity waste to be minimized, in contrast with traditional cryptocurrencies that use a large amount of machines working in parallel to achieve the consensus process.
After all that has been told, it makes sense that this process is called farming instead of mining!
Chia crypto blamed for hard disks shortages and price surges
An amazing fact that also implicates the impact that Chia crypto had in the global community is that since the launching date of Chia crypto the demand for hard disks hiked impressively.
This has led to a complete destruction in the short-term supply chain for hard drives, a fact that the same Bram Cohen admitted.
Also a bad consequence is that vital components for hard disks became a subject of speculation.
Finally Phison Taiwanese electronics manufacturing company, stated that SSD prices will go up by 10% or so in the coming months.
This increasing demand is a key factor for this new green cryptocurrency, which indicates that Chia crypto is useful, eco-friendly, reliable and actually works!
Also is a great option if you would like to be involved in the farming process because it continues to be lucrative until today!
If you liked this post you can continue learning some amazing facts about Safemoon coin!
