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Meet Chia: China’s New Bitcoin

CryptocurrencyApr 16, 2021 08:30AM ET
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Meet Chia: China’s New Bitcoin

  • China has launched a new digital currency, Chia, which is being hailed as a direct competitor to Bitcoin, only it offers energy-efficient farm-at-home rewards.
  • To achieve greater energy efficiency, the Chia Network has reintroduced the consensus model called Proof of Space and Time (PoST).
  • The crypto launched with a cap of 21 million tokens – a direct nod to Bitcoin.
  • “Farmers” (miners) began earning the crypto right after its launch.

Since Bitcoin debuted in 2009, countless other crypto projects have been pitted against it, with the vast majority failing the test of time. Now, we have Chia, hailed as the green Bitcoin and the next Filecoin. Within a month of its launch, hard disks are selling out in China. Here’s what you should know about China’s new cryptocurrency.

What Is The Chia Network?

Chia Network Inc. is a blockchain startup based in China that seeks to reinvent digital money. Chia was founded by Bram Cohen, the inventor of BitTorrent. On March 24, Chia Network Inc. introduced its revolutionary eco-friendly blockchain and its new digital currency known as “Chia” (XCH).

Chia has stated, “We believe that cryptocurrency should be easier to use than cash, harder to lose, and nearly impossible to steal.” The company expects that their blockchain and the Chia currency will be used to complete cross-border payments and issue financial assets and stablecoins.

On a much grander scale, Chia plans to sell software services and support for its open-source blockchain and smart transaction software to governments, financial institutions, corporations, and large buyers and sellers of storage.

A key feature of the Chia blockchain is the new consensus model it proposes called Proof of Space and Time (PoST). The business whitepaper of the Chia Network articulates how it aims to become the go-to for sustainability.

The Next Filecoin – Only a Bitcoin Competitor

Chia has been called the next Filecoin because it operates in a similar manner. To earn Chia, miners – or as they are called in the Chia Network farmers – allocate free storage space on their devices and are rewarded for their participation.

The Proof of Space and Time (PoST) model adopted by Chia was created by Cohen. Unlike other consensus models that consume massive amounts of electricity in running mining rigs and single-purpose ASIC hardware to validate transactions, PoST will leverage “the over-provisioned exabytes of disk space that already exist in the world today.”

Chia is attempting to make home mining possible again by allowing farmers to contribute their unused computer storage space. To mine or farm, whichever you choose to call it, “just download the Mac or Windows version and double click.”

On the Flipside

  • While the Proof of Space and Time (PoST) consensus model has been hailed for consuming less energy than Proof-of-Work, it is not without its possible drawbacks.
  • One glaring drawback is the possibility of malware being downloaded onto one’s hard drive.
  • Although not a problem of the same magnitude as energy consumption, malware can be used to attack computers like the 50 million affected devices in 2020.

Predictable, Continuous Inflation The Way To Go?

Another important takeaway from Chia’s whitepaper is the route it takes toward the supply of tokens. While most other cryptos have a hard cap, Chia argues that:

“Being able to directly calculate a shared expectation of the total supply at any given time gives much the same financial and peace of mind benefit.”

The mainnet of the Chia Network launched with 21 million XCH in circulation. According to the whitepaper, it will take another 21 years for the current supply of tokens to be doubled.

The whitepaper also acknowledges the importance of regulators in the crypto space, and Chia will embrace regulations rather than trying to fight them. The Chia Network has made it clear that it will opt for a public listing in the future.

By opting for a public listing, the Chia Network will essentially allow backers to treat its equity as an exchange-traded fund (ETF) for the XCH cryptocurrency.

Continue reading on DailyCoin

Meet Chia: China’s New Bitcoin
 

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Comments (10)
Jef Larher
Jef Larher Jun 01, 2021 7:34AM ET
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I didn’t know that China purchased U.S.A. ! Seriously guys, a minimum of investigation before publishing and you’ll have seen that chia.net is an American org.
chuck stoops
chuck stoops Apr 22, 2021 1:51AM ET
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Chia is an American company.
Ian Cameron
Ian Cameron Apr 17, 2021 3:15AM ET
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It's nice to see Chia promoted but it was launched in the USA. It's completely different from Filecoin and does not offer storage space, with farming the proof of work and the time taken is stored on the hard drive and once there is available for around ten years. There will not be 21 million XCH in circulation on exchange launch, there will be around 200,000, increasing to close to 21 million over 21 years, with a halving every 3 years. The last paragraphs are entirely correct. I don't really get the malware thing. Yes, that is a general issue with PCs but is not a specific issue with Chia.
Ian Cameron
Ian Cameron Apr 17, 2021 3:14AM ET
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It's nice to see Chia promoted but it was launched in the USA. It's completely different from Filecoin and does not offer storage space, with farming the proof of work and the time taken is stored on the hard drive and once there is available for around ten years. There will not be 21 million XCH in circulation on exchange launch, there will be around 200,000, increasing to close to 21 million over 21 years, with a halving every 3 years. The last paragraphs are entirely correct. I don't really get the malware thing. Yes, that is a general issue with PCs but is not a specific issue with Chia.
Vincent Drake
Vincent Drake Apr 16, 2021 2:59PM ET
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Chia has nothing to do with China, whatsoever.  I found this on their FAQ page concerning why it's called Chia -  Why are you named Chia? We’re green money! Our founder Bram Cohen started the company knowing he wanted to reduce the energy dependence of blockchains through a “green” option. The concept of farming seemed to be the best metaphor for filling unused disk space and monitoring it for winning sprouts. This led us to look for a grain that had the properties we wanted to embody with our new Network. The team wanted a name that would be short and impactful. Everyone was amused that it was also a grain associated with a whimsical meme. Chia Network was born.
Vincent Drake
Vincent Drake Apr 16, 2021 2:58PM ET
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Chia has nothing to do with China at all. Taken from their FAQ page: Why are you named Chia? We’re green money! Our founder Bram Cohen started the company knowing he wanted to reduce the energy dependence of blockchains through a “green” option. The concept of farming seemed to be the best metaphor for filling unused disk space and monitoring it for winning sprouts. This led us to look for a grain that had the properties we wanted to embody with our new Network. The team wanted a name that would be short and impactful. Everyone was amused that it was also a grain associated with a whimsical meme. Chia Network was born.
Brandon Butler
Brandon Butler Apr 16, 2021 2:38PM ET
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This article is a direct plagiarism from one written by the DailyCoin, which by the way, was also factually inaccurate. Chia is not based out of China. And if a news source wrote about my product implying that it _was_ from China, and also may install malware on my machines, I'd sue you for libel. You may want to take this down is all I'm saying. Not a threat. I'm not a lawyer. I'm also not associated with Chia. Nor am I associated with China. Just someone that doesn't mind calling out plagiarism and slander.
Jude Niles
Jude Niles Apr 16, 2021 1:03PM ET
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Investing.com, how about researching.com before posting an article like this... Just saying.
Will Phule
Will Phule Apr 16, 2021 12:46PM ET
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This "article" is factually incorrect and an embarrassment.
Will Phule
Will Phule Apr 16, 2021 12:45PM ET
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This "article" is factually incorrect and an embarrassment.
 
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