Story of Honest Mining
Bitcoin offers mankind a future where everyone can count on trust-worthy system based on blockchain. Innovations arise and now we have hundreds of coins & tokens built for different purpose.
Transaction Validation is fundamental for any blockchain technology. On a trust-less blockchain, validators are essentials thus they mostly get rewarded with internal currency as incentive. The world call these people MINERS.
Decentralization movement have to involve miners. But the barrier of entry are too great for everyone.
HonestMining was born to solve these issue. Our mission is making trust-worthy crypto mining that is accessible to everyone.
Mining at a glance
PROOF OF WORK
In 2009, the Bitcoin network went online. With that, Bitcoin became the first PoW (Proof of Work) cryptocurrency on of the Nakamoto Consensus.
PoW requires each validator do some work to prove that it is trustworthy. Each solve complex cryptographic problems using their own computational resources and the one who find the solution can confirm the transactions and write the block onto the chain. Miners are competing with each other to create the next block of transactions on the blockchain. In turn, the winning miner receives cryptocurrency tokens as a reward for the amount of time and energy spent for generating the solution.
This reward system incentivizes miners to generate the right solution and ensures the network remains secured; while the newly minted cryptocurrency is added to the overall circulating supply of coins on the network.
PoW miners need to invest on capable hardware & infrastructure. They also need to run the latest version of software in order to support the network.
As the network grows, the difficulty grows and the amount of coins rewarded are also decreasing to curb supply. With decreasing supply, the crypto itself will worth more due to increasing demand.
PoW is energy hungry by design. Cost, maintenance, and efficiency are issues related to this matter.
Another point is centralization that comes with the increasingly highly specialized hardware needed for PoW. With the advent of Application-Specific Integrated Circuits (ASICs), it becomes apparent that only those with tremendous capitals can take part of this mining activity.
PROOF of stakes
On Proof of Stakes, a validator may validate block transactions if they . PoS (Proof of Stakes) decentralizes the consensus power by ensuring rewards are distributed based of how much coins it stakes.
As such, the selection is strongly influenced by those that have the most coins – the more they have invested in the network, the more they have to lose in the event of any mishaps. Another influencing factor is the time period that coins have been held by users, which indicates whether they are invested for the long-term – clearly a more desirable position than someone who just purchased their coins yesterday.
So, those with more stake in the network are deemed to be more trustworthy and considered less likely to attack the network. Indeed, in order to mount an attack, a user would have to buy 51% of the coin value of the entire network.
PoS miners need to believe on the crypto coin itself in order to get the reward. Similar to PoS, the miner need to understand how to run the latest version of software in order to support the network.
"Nothing at stakes" condition allow miners to vote on multiple chain. This is especially dangerous during chain-split / fork condition.
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