Chia (XCH) is a cryptocurrency and blockchain created by California based company; Chia Network Inc. Chia Network was founded in 2017 by Bram Cohen, the creator of BitTorrent. Chai mining implements the proof of spacetime and storage concept which differs from Bitcoin (BTC) and Ethereum’s energy-burning proof-of-work model. This eco-friendly approach utilizes storage media, such as hard disk drives and solid-state drives which people often already have and can use for no additional cost.
Chia is an innovative cryptocurrency that leverages pre-stored data in files known as plots, which are generated and stored by users. By employing a highly efficient process that consumes minimal resources, Chia verifies proof of space and time within these plot files. This approach ensures that Chia operates at remarkable speed while maintaining an environmentally friendly footprint.
Chia Network aims to create a decentralized and open-sourced blockchain network that facilitates payment settlements through Chia (XCH), its native cryptocurrency. The network is designed to enhance existing international payment and financial infrastructure, offering digital currency solution. Chia Network envisions various use cases for Chia, including asset tokenization, decentralized exchanges (DEX), decentralized finance (DeFi), and efficient cross-border personal payments.
According to Chia Network, its Proof of Space and Time (PoST) is the only Nakamoto consensus algorithm since Proof of Work, while also having a much lower energy consumption. This algorithm leverages excess hard drive space to validate the allocation of resources to the network. Part of Chia's mainnet was launched on March 19, 2021. Development of its ecosystem is ongoing, with primitives released for CATs (Chia Asset Token), Non-Fungible Token (NFT)s, Offers, and DIDs (Decentralized Identifier).
In the Proof of Space mechanism, farmers provide evidence of their allocation of unused hard drive space. The Proof of Time strengthens the blockchain's security by enhancing its resistance to attacks. Chia's 1.1 version of consensus is specifically designed to ensure a high level of security, safeguarding against 51% attacks in most scenarios. Compared to proof of work blockchains, Chia offers a more energy-efficient and inclusive approach while maintaining a similar level of security. In contrast to proof of stake blockchains, Chia is less vulnerable to attack and manipulation, avoiding issues such as wealth concentration and centralization that can arise from staking.
Chialisp is a smart coin language developed by Chia Network, based on the functional language Lisp. In the Chia blockchain ecosystem, every element is represented as a coin. Smart coins deliver both smart contract and smart transaction capabilities in one package. Chialisp has been designed to prioritize security and simplicity while offering powerful and broad functionality. It serves as the foundation for applications running on the Chia Network blockchain, specifically tailored for payment and financial use cases. With Chialisp, developers can create powerful and versatile applications that meet the requirements of payment processing and various financial applications. Chia Network supports chia developers and supports the enterprise use of chia with software support and chia lending.
Chai Asset Token
Chia Asset Tokens (CATs) are fungible tokens issued on the Chia blockchain. The CAT puzzle guarantees that the supply of a particular CAT remains constant unless the specific issuance rules for that CAT are followed. This is enforced through a Chialisp program called Token and Asset Issuance Limitations (TAIL). The inner puzzle determines the ownership of the coin, and when it is spent, the new puzzle is wrapped in the CAT once again. Usually, you wrap the standard transaction to enable the sending of CATs to Chia wallet addresses..
Colored coins on Chia Networks are Chialisp's most powerful smart transactions used for tokens issuance of alternate coins, assets, and stable coins. They provide support for implementing protocols like Omni on Bitcoin and ERC-20 on Ethereum. Chia's colored coins introduce a unique feature called "offer" where you can create and distribute unfinished transactions. With colored coin offers, you can generate new colored coins while burning Chia. These offers can be shared with others, and anyone can complete the transaction on their side. This allows for easy distribution and transfer of colored coins .
For stable coin issuers, colored coin offers provide a way to create applications that enable end users to use their stable coin, pay transaction fees using their own coin, and remain unaware that these operations are happening on the Chia blockchain . It's as simple as creating a new token and experimenting with it. The on-chain programming environment provided by Chia makes this process easier and more straightforward.
In the Chia Network, the process of mining is referred to as farming. Farmers, who act as miners on the Chia blockchain, utilize the unused storage space on devices such as laptops, desktops, or corporate networks. In return for securing the network, farmers receive Chia as rewards. To participate in farming, users employ the Chia node software, which enables them to allocate their unused storage space to create plots. Once created, the computer farms on behalf of the user, and the software keeps track of all the rewards earned through this process.
According to the Chia Network whitepaper, the farming rewards are distributed as follows: during the first three years after launch, 64 chia will be created every 10 minutes. In years four through six after launch, 32 chia will be created every 10 minutes. In years seven through nine after launch, 16 chia will be created every 10 minutes. In years ten through twelve, eight chia will be created every 10 minutes. From year twelve onwards, four chia will be created every 10 minutes.
This distribution schedule implies that the network itself controls a significant portion of XCH. Additionally, it is projected that farming rewards will catch up with the size of the strategic reserve within 21 years from the mainnet launch.
Plotting involves generating and storing unique cryptographic data called plots on a user's storage device. These plot files serve as proof to the network that the user is storing data and used for Chia's consensus for Proof of Space and Time.
Plotting is like setting up a Chia farm. It's a one-time operation that requires significant computational power. During plotting, the user's CPU, RAM, and storage devices (such as SSDs) are heavily utilized. However, once the plot is created and stored, the ongoing farming process becomes much less resource-intensive and has minimal impact on the user's hardware. With a created plot, farming only requires occasional disk input/output (I/O) operations to verify and submit proofs of space in response to network challenges.
Th requirements for plotting include a decent amount of computational power, sufficient RAM, and ample storage capacity. The specific hardware requirements may vary depending on factors such as the size of the plot, the desired plotting speed, and the user's preferences.
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