Author: Ming Xi | Producer: Benz Finance
On May 13, Tesla CEO Musk tweeted that Tesla is considering using cryptocurrencies with lower energy consumption. Also, there are concerns about the impact of Bitcoin on the environment.
As soon as Musk shouted, Chia, known as "Green Bitcoin", became lively.
secondary title
Recent Chia shocks
On May 7, Bram, the founder of Chia, tweeted that the prototype of the official mining pool solution is expected to be released on May 17. The previous K32 file of P does not support the new mining pool. If you need to access the official mining pool, you need to re-P As shown in the figure, the previous k32 could not obtain a stable burst mechanism.
Two days after the news was fermented in the self-media, the computing power of Chia's entire network dropped from 3219.63PiB on May 9 to 3001PiB on May 10, a drop of more than 218PiB.
The sudden drop in Chia's computing power is closely related to the speculation and analysis of Chia founder Bram's tweets from the media. Among them, "K32 files do not support new mining pools." After the mining pool agreement comes out, the previous P disk will be Invalid, blocks cannot be obtained; at the same time, after the mining pool agreement comes out, the mining pool bound by the miner will become invalid.
These two points of analysis are a fatal blow to Chia miners, but if you read Bram’s tweet carefully, you will understand that the service life of the old K23 file is 7-15 years. After the new mining pool agreement comes out, miners can still mine SOLO. It’s just that you can’t join the new mining pool agreement; miners voluntarily choose whether to join the new mining pool agreement, and you must restart the P disk to join the new mining pool agreement.
Since the incident has fermented, the enthusiasm of Chia miners has risen again. According to Chiaexplorer data, as of 8:00 on May 13, the effective computing power of Chia's entire network was 4114.29PiB. Compared with 2709.45PiB on May 10, the computing power of the entire network increased by 1400PiB, and the current number of active miners is 121179.
secondary title
Bitcoin "follower", where is Chia "green"?
"Bitcoin's wealth legend has made the blockchain industry".
If I say this, there should be no objection. If you come to refute, then I can only say "I want to think".
On May 22, 2010, a programmer bought two pizzas worth $25 with 10,000 bitcoins. On May 13, 2011, the price of Bitcoin was still at a few dollars. In 2021, the price of Bitcoin has exceeded 40,000 US dollars, broke through 50,000 US dollars, and nearly 60,000 US dollars, an increase of 15,000 times in ten years. Such an increase can be described as a "miracle" in financial history, because trading BTC, hoarding coins , Mining, and people with assets exceeding 100 million yuan abound.
Now, Bitcoin is not only a cryptocurrency, but also the hidden backing of the encryption market, the hidden belief in the hearts of retail investors. The "sky-high price" bitcoin may not be held by any retail investor, but the vast majority of speculators can't help thinking "as long as bitcoin is still there" during several black swan events.
Everyone's thinking has become the research direction, who can become the next Bitcoin, and who will become the next generation of "legends" in the encryption market. And the retail investors who are looking for money are also looking forward to being lucky enough to bet successfully and realize the freedom of wealth.
Under the influence of the complex and multi-dimensional sentiment in the market, Bitcoin's "imitators" have come and gone in an endless stream. Among the many latecomers who imitate, plagiarize, or learn from, Chia can be said to be the best.
Some people say that Chia was born with "noble blood".
Bram Cohen, the founder of Chia Network, is the founder of BitTorrent, and COO Ryan Singer is the co-founder and COO of Tradehill Inc. The investment institutions behind Chia are also well-known, such as a16z Crypto and Galaxy Digital are world-renowned investment institutions. It is understood that as of now, Chia has obtained financing of 16 million US dollars and is expected to be listed on NASDAQ in August this year. On May 7th, Amazon's cloud service platform deployed Chia and launched a Chia coin solution.
Wearing a halo has become one of the main reasons why Chia is so popular.
Another more important reason is the characteristic of Chia - "green bitcoin".
This has to talk about the topic of Bitcoin involving waste of resources. At present, Bitcoin mining requires large-scale physical mining machines and mines with stable operation and abundant power resources. According to reports, the electricity consumed by the current production of bitcoins for one year can be used by 20 million people for one year. The problem of high energy consumption has become an inevitable issue that needs to be discussed for the long-term development of Bitcoin.
Bitcoin mining has become a small number of professionals who can engage in professional activities, and the so-called prospect of decentralization seems to be traveling far.
Chia's so-called "green bitcoin" is a more energy-efficient and decentralized cryptocurrency than the "huge and terrible waste" bitcoin described by founder Bram.
This mainly relies on Chia's Proof of Space and Time consensus mechanism. The following outlines the time-space proof consensus mechanism through the Chia mining process.
Chia mining is a process in which users write a large number of Nonce (arbitrary or non-repeating random values that are used only once) in the format of Plot files on the hard drive space. The farming process of sowing seeds on the ground is also vividly called "farming (Farming)", and users participating in farming are called "farmers". The probability of a farmer winning a block is the percentage of the space of each plot in the total space of the entire network. That is to say, the larger the space of the P disk, the higher the probability of winning the block.
In order to prevent top farmers from creating backup transaction records to attack the system, Chia uses VDF (Verifiable Delay Function) to realize the time ordering of blocks to ensure the relative security of the network.
secondary title
Who is behind Chia?
Chia Mining claims to use the oversupplied remaining disk space to achieve green, low-energy decentralized mining, and to eliminate or replace high-energy ASIC hardware for verification and transactions.
We talked about Chia’s strong founding team above, which makes it have a halo, but this original “foreigner” is only popular in China, and some people even suspect that this project may be a project managed by domestic dealers. Netizens broke the news, especially Zhang Jian, Xue Manzi and other "veterans" in the currency circle who have been depressed for several years suddenly came out and started dumping mining machines, which reminds people of the "crazy currency circle" in 2017.
The so-called skyrocketing price of hard drives is also a current situation in China. It is understood that many people in the circle can easily purchase goods from countries and regions such as Southeast Asia, and the hard drive market in the United States has almost no fluctuations. However, many of the Chia mining machines sold in China are low-quality products wholesaled from abroad at low prices. When the domestic market is in short supply, they are sold at high prices.
According to foreign media tomshardware, recent data shows that Chia coin mining will make consumer-grade SSDs very vulnerable to damage, and the write life will be exhausted within a few weeks.
secondary title
"Real Farmers" & "Fake Farmers"
Faced with the benefits, people are jealous, and the solid-state hard drives are out of stock for a while, and even have a premium of 10 times. The waste of resources in the middle has even been reported by major media in turn, and "encryption currency" has once again been out of the circle.
After a round of upsurge, Chia Mining's entire network continued to climb with all its strength, and the number of active miners exceeded 10W. According to Chiaexplorer data, as of 8:00 on May 13, 1TiB expects to harvest 0.0022 XCH per day, and the time for 1TiB to harvest 1 XCH is 1 year and 92 days.
On April 5th, Weibo user Chia mined, and 60T could harvest 2 XCH per day on average. However, according to the current data calculation, the data for harvesting XCH in one day is 60×0.0022=0.132 pieces, and it takes about 15 days to harvest 2 XCH pieces.
Benz Finance reporter interviewed many Chia miners. One of the family Chia miners said that he entered the site on April 16 and 7 and probably invested tens of thousands of equipment costs. pay back. As far as 1P computing power is concerned, when he first entered the market, the computing power of the entire network was about 300PiB, and the daily output was 30 B, worth about 30,000 US dollars. Now the computing power exceeds 4000PiB, and the current daily output is only 1.51B, worth about 1500 US dollars .
It can be seen from this that with the multiplied increase in the computing power of the entire network, the number of miners entering the site is increasing, and the difficulty of mining is becoming more and more difficult. Without increasing the hard disk space in advance, the mining income is getting less and less , the payback period will become longer and longer. At the same time, miners need uninterrupted drawing and drawing, P disk, P disk, and when the speed of P disk cannot keep up with the increase in computing power, the payback is even far away.
In essence, the mining industry follows the survival of the strongest rule. Mining needs to configure basic mining machine costs, maintenance costs, etc. Mining cannot be carried out without financial support.
According to the reporter of Benz Finance, at present, most of the small computing power will choose to enter the mining pool, and basically the mining pool will deduct 30-40% of the computing power. A large number of Chia mining machine vendors have appeared in the market. According to the survey, the cost of a Chia mining machine with a 120T computing power is about 60,000. When the computing power of the entire network remains unchanged, the payback period exceeds 30 days, not to mention that the computing power of the entire network is increasing every day. About 15%.
The words "farming" and "farmers" seem to create a kind of equality and equal treatment that "all living beings can participate". In fact, the reality is still cruel, and the living conditions of small miners are being suppressed. The small miners who enter the market now are making money in the cracks, and in the end they can only compromise with capital and centralization.
While the market is looking at money, Chia's original intention and vision may also go further and further away.
In the long run, as Chia mining becomes more and more market-oriented, when the computing power is close to saturation, Chia will still face the same dilemma as Bitcoin. How to ensure the operation of low energy consumption?
In terms of value, in the FOMO sentiment boosted by the bull market, 2021 has become an incredible year for the encryption market. The absurd drama of NFT, animal currency, FIL, altcoin and other value multiplications continues to be staged one after another. The value of XCH Bubbles make it difficult for the market to see the way ahead.
From this point of view, as Chia is committed to improving the global financial and payment system, the consensus on this vision is not solid, and Chia has a long way to go in terms of supervision, compliance, landing applications, and value consensus.
