Crypto Academy Week 13 - Homework Post for @alphafx

INTRODUCTION

Consensus algorithms is an important sequence implemented codes that plays a vital part in Blockchain networks as well as in crypto space. Although from the lecture, there were many of the Consensus algorithms listed by the Prof. @alphafx but only asked to deal on one. However, in this article,I will be discussing on Proof of capacity.

PROOF OF CAPACITY

PoC is said to be a consensus algorithms in which many blockchain uses, that permits for mining process through available hard disk space so as to determine the mining rights of miners as well as to verify transactions.

In this consensus algorithm known as PoC, the fastest miner to discover the solution values gets the higher opportunity to create a new block in the blockchain. Perhaps, the storage capacity of the hard drive space also plays a role to get higher opportunity to create a new block as well.

SOLUTIONS PoC RENDERS TO PoW and PoS

The PoC has multiple merits and numerous projects to offer as it serves as an alternative solutions to problems regarding consumption of high energy and crypto assets hoarding in proof of work and proof of stake systems respectively. However, the PoC solve the problems mentioned above in such a way that on the blockchain network, it grants the nodes to have access on the blockchain network so as empty their hard drive space to enable it mine out available crypto assets.

Another means PoC provides solutions to other algorithms like PoW and PoS is that before the mining activity take place, it stores the solutions on the mining hard drive device on the blockchain network.

Although the solution values change, but for the miner to obtain better chance to win mining reward, it depends on how larger the hard drive is because the bigger hard drive is the more possible solution values the miner can be enable to store on the hard drive device. For further explain, let's assume there's a lottery reward contest, and this reward will be given to the winner based on matching numbers on the winning ticket. Hence, the player to win this contest must have a longer list of numbers.

THE AIM OF PROOF OF CAPACITY

Each of the Consensus algorithms has it's own purpose. System or blockchain function effectively with the help of the Consensus mechanism algorithm such as Proof of Capacity, stellar consensus protocol and many others.

One of the purpose of proof of capacity is the solutions it provides to PoW and PoS which I mentioned above. In blockchain and crypto assets space, the PoC plays a vital role as it makes certain appeals so as to approach global adoption in blockchain as well as in crypto space. As such it ends funds staking in a wallet that is connected to internet 24/7 which then makes things very easy for the miners.

HOW PROOF OF CAPACITY WORKS

It works in two different step process which could be either by plotting or mining.

PLOTTING

In plotting, the first required is by plotting the hard drive and this is executed by creating a list that contains all the possible number only used once(nonce) values through the means of repeating hashing of data and also make use of a shabal also known as hashing function. Each of the nonce consist of 0- 8192 numbers and possess total of 8192 hashes. Hashes a said to be paired into scoops when two adjacent hashed joins together.

Example:

Hash 3 and 4 constitute scoop 2, hash 4 and 5 constitute hash 3.

Moreover, the nonce is very important to the blockchain miner because it is the first number to find out before solution values in a blockchain and it keeps the blockchain secured. However, it is very difficult to discover and once it's discovered by miners, all the miners goes with gifted Cryptocurrency for the time and skills rendered.

MINING

This is another step process which involves mining, in which the miner calculates the scoop numbers. This process is very relevant and is repeated to calculate deadline in each of the nonce stored on the hard drive device of the miners, as such the miner takes the one that have the lowest limit deadline after the series of the calculation regarding all the deadlines.

Example:

Assume when mining activity commence and the miner generates a scoop number 59, then the miner will go straight to scoop number 59 of nonce 1 and the miner will use the scoop data obtained from this information to calculate and determine an appropriate deadline value.

The miner is allowed to forge a new block in the blockchain, only when the time duration in which the last block forged has elapsed, that's must reach the deadline( in seconds). Perhaps, should in case there is no other miner to forge a block within the time interval, the miner can as well forge a block in the blockchain and can as well claim the block reward.

For example:

Suppose Armstrong is a miner, and comes up with a lowest limit deadline of 25 seconds and if Chibueze another miner can't forge the block within the next 25 seconds,then Armstrong has the right to secure the chance of forging the next block as such claims the reward as well.

PROJECTS USING PoC

Currently, not all crypto assets uses Proof-of-Capacity, only few of them uses it such as Burst coin, BXTB, BTCHD which are the current three projects using PoC. Others are permacoin, Storj, Chia, and SpaceMint. I will be emphasizing only on the three current projects.

BURSTCOIN

The BurstCoin can be used in many cases as it can provide an adequate concept to business owners, miners, and developers. Also it explores different cases from smart contract, to solutions for payment, to crowdfunding as well as arbitrary messages. Based on these, I could say the BurstCoin possess versatility as such could be used for versatile projects in PoC

BXTB

It is one of the current Cryptocurrency that uses PoC system and it's a decentralized finance (DeFi) protocol which concentrate on creating increase in demand and supply as well as throughout stable coin. In BXTB, advantage of PoC is to allow the users to mine BXTB governance token as such this governance token is then joined with the stable coin like Tether(USDT) to derive yBXTB and Chip token. The new Chip stable coin generated can be used for eSports, and in gaming.

BTCHD

This is the third project that uses PoC for their crypto asset known as BHD. This project has some similar properties just like that of BurstCoin and as matter of fact can be possible to mine out both assets at the same time. The purpose of this project is to give out credits and provide an adequate network that is suitable to handle 70 transactions per second to the people.

ADVANTAGES OF PROOF-OF-CAPACITY

NO DEDICATED HARDWARE USE

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One of the benefits the users of PoC derived is that upgrading of the available hard drive device is constant as such prevent the need of dedicated hardware in the system.

ENSURES MAXIMUM FAIRNESS AND PETTY ENERGY CONSUMPTION

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It ensures maximum fairness and little significant energy consumption as such is 30 times more efficient in terms of energy than that of the ASIC based Bitcoin cryptocurrency during mining process.

REUSE OF HARD DRIVE DEVICE

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One of the benefit of PoC is that mined data can erase easily from the drive and the drive can as well be reused to store any other data as such reduce cost of buying drive.

USE IN REGULAR HARD DRIVE DEVICE

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The PoC can be actually used on any of the regular hard drive device even users with Android based system can as well use it.

DISADVANTAGES OF PROOF OF CAPACITY

NOT FREQUENTLY USE

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Although it possess low energy consumption and ensures maximum fairness but yet many developer don't use the system.

POSSESS MALWARE

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Since any miner has the access to mine, malware during mining process could be possible.

COMPETITION WHEN ADOPTED GLOBALLY

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Another major disadvantage PoC is that globally adoption of this system can lead to arms race to manufacture higher capacity hard drive device.

CHECK IT OUT: PROOF OF CAPACITY Vs PROOF OF WORK

The proof of capacity has some good similarities with that of the proof of work. In the table below I will be explaining the superiority of Proof-of-Capacity compared with that of Proof of work.

PoC	PoW
Miners are allowed to use their available hard drive space device during mining activity.	PoW users use hardware device like powerful CPUs or GPUs to mine during mining activity.
Finding solutions is very easy but checking result is bit hard.	very difficult to find a solution but result checking is very easy.
Has very low energy consumption	Consume more energy.
Bitcoin ore and BurstCoin uses PoC system	Litecoin (LTE), Ethereum (ETH), and Bitcoin (BTC) uses PoW system.
Has high and effective performance.	Low performance.
The miner is allowed to forge a new block in the blockchain, only when the time duration in which the last block forged has elapsed.	The prover must show some prove to the verifier that he or she done the job before a new block in the blockchain will be added.

CHECK IT OUT : PROOF OF CAPACITY Vs PROOF OF STAKE

PoC	PoS
The coins are distributed to miners through mining activity.	ICOs, crowdsales, airdrops distributes the coins.
The time duration for distribution is long	The time duration for distribution is short.
Every miner has access to mine since it only needs a computer and free HDD space.	The decision making of the coins is focused in the hands of the minority.
Miners receive their reward fairly based on the disk capacity they use.	people with more coins obtain more coins during reward.
PoC is More better decentralized system.	Pos is more fair system.
In PoC system, DLT environment is a public blockchain where every miners has equal right.	In POS system possess both public and private blockchain.

Conclusion

The proof mechanisms are very important and sensitive algorithms because they play a vital role in blockchain networks. I can say that with them the blockchain network and the available data stored is secured from attack or theft. But without them the blockchain network and data stored are not secured and can lead to attack or theft.

However, the proof of capacity can't be over emphasized because it offers much to some blockchain network and it empower users by allowing them to obtain excessive leverage hard drive space to perform the mining process since the hard disks are available at low cost.

Thanks for reading through

Cc:
@alphafx