Crypto Academy Week 13 - Homework Post for @alphafx by @jeemrocker
Greetings professor @alphafx and greetings to the #cryptoacademy. Each assignment addresses a topic that is new and fascinating to me.
What is it?
How does it work?
What is it for?
With the technological evolution regarding the mining of Coins, and like all advances in technique and technology, they are developed from the "Trial and Error".
Every time something new comes up, it needs to be tested and refined. In this way, with the appearance of mining, processes are put into practice that allow the miner to collect the coins and therefore generate their profit. Among these processes was born the Proof of Work proposed by Satoshi Nakamoto (Creator of Bitcoin), however, these caused high costs and energy consumption to be able to keep crypto assets safe.
This is how the Proof of Burn arrive. These are algorithms created to provide a better and more efficient consensus on the Internet and distribute it in a way that the blockchain works better.
On the Internet, many times a double commission expense is generated in cryptocurrencies, and at this point the PoB eliminate this expense, lowering costs
In the blockchain, a team of people who very possibly distrust each other work, in this way it is necessary to create a Consensus Algorithm, so that mining can be worked distributing resources equitably.
The Proof of Burn also seek to reach that consensus on the web. This provides each node with a copy of the data to avoid contradiction in the processes.
One of the purposes of the PoB Algorithms is to allow the members of the Network to establish sustained and sustainable economies, which maintain their price in the market over time, despite adversities, falls or investors who decide not to trade their assets.
On the other hand, PoB allow maintaining harmony within the blockchain, by getting rid of the tokens that are left over from transactions made in the markets. In this way, they ensure balance in the Network, avoiding disputes and using the money raised in the burning, to carry out new projects.
This burning of tokens favors the market since when the amount of tokens decreases, their value increases. Something similar happens with physical money. When the amount of printed banknotes increases, their commercial value decreases and therefore higher inflation is generated, that is, the value of the products increases.
In April 2021, Binance burned a total of $ 595 million in BNB tokens, in what was the Biggest Burning So Far , This caused a 1500% increase in the market.
| Project | Description |
|---|---|
| SLIMCOIN (SLM) | P2P project. It uses the PoB as a mining method and Consensus Algorithm, Combining PoW and PoS |
| COUNTERPARTY (XCP) | Create New Tokens using PoB on the Bitcoin blockchain |
This has been my homework for week 5 season 2 of Professor @alphafx assisted by Professor @levycore, I hope you like it.
Thank you very much for the class
Hi @jeemrocker I think you got a bit confused with the topic, but in the end you deflected it to its point, which is token burning thus controlling its inflation.
What translator do you use?
Hi @cieliss, im using google traslator! Let me read what do you say🤗
@cieliss When I talk about inflation, I mean the example of printed money, giving an example of what happens when there is a lot of a given token. hence the need to perform token burning
Excelente. Si, eso me quedo muy claro. Te recomiendo usar el traductor deepl.com es mas efectivo y con menos errores de traducción.
Suerte con la tarea !!
Muchísimas gracias por tu sugerencia, lo usaré 🤗🤗🤗
Adequate explanation of P.OB, but i needed to see the advantages and disadvantages of using this algorithm and how P.O.B differs from other algorithms mentioned in my lecture. see you next time.
Thanks for participating
@alphafx, thanks so much for your lesson!