Crypto Academy Season 2 Week 5 Homework Post for (@alphafx) - "Proof of Burn"

Hello steemians,

This is my homework task of Season 2 Week 5, So here I am sharing my homework task which is given by prof. @alphafx. Here I'll explain about "Proof of Burn".

What is Proof- of- Burn (POB)?

Proof of Burn (PoB) is a consensus process that allows miners to "mine" some of their signals. This means that miners who have the right to use some of their money to mine blocks and receive rewards can withdraw.

The creation and distribution of the leading digital currency Bitcoin, and its hidden innovation, the blockchain, have brought unlimited potential results and new developments to the biological systems of cryptocurrencies and currencies. The deal is one of these new innovations in development.

Iain Stewart organized this conference after proposing the idea of ​​Proof of Burn at the famous Bitcointalk event in December 2012. Iain describes the calculations in a relationship: the coins consumed mimic mining equipment. An excavator uses his coins to buy a virtual mining machine, allowing him to mine squares using this method of analogy. Another forum user submitted a similar idea in January 2012, but his idea did not materialize.

Although the best known protocol agreement used in the form of digital currency on its blockchain is Proof of Work (PoW) and Proof of Stake (PoS), Proof of Recording (POB) promises to hide the aforementioned flaws and calculations. . inserted. To this end, it tries to introduce a more efficient arrangement while ensuring the safety and soundness of the organization. The Burning Proof or Burning Test does not use mining interaction to find and obtain new forms of digital currency. Perhaps despite popular expectations, it includes badges that consume certain local or elective digital currencies for the option to separate them. From the beginning, the system appears to be a nonsensical or contradictory loop, but to get it, you have to find your function.

How does Proof of Burn (PoB) work?

The Proof of Burn (PoB) deal agrees to use an unusual method to settle and verify exchanges within the blockchain. Here, the excavator should send digital currency to unquestionable public places. This location is called the location of the cafeteria near the food, and they will never get it again from then on. In the final analysis, miners should have some interest in blockchain in the form of digital currency. In addition, with the expansion of measurement in the form of digital currency consumed in the organization, the mining impact obtained by the excavator has also become more prominent.

Therefore, miners must put resources on the blockchain to show their obligations to the organization. In this sense, this agreement has been firmly integrated with Proof of Work (PoW). It is important that the excavator does not invest resources in expensive and surprising registration hardware, but in tokens and digital currencies. Therefore, in the burn test (PoB), the consumed digital currency will be unusable and no customer will be able to pay for it. This is because the consumer's address is arbitrarily set and there is no private key associated with it. Therefore, whenever the cryptocurrency is sent from these locations, it cannot be recovered.

Advantages and Disadvantages

While the customer's consideration and purpose of this discussion are very unique, we can understand the substantial benefits and harms of this understanding in general.

Advantages

• Combustion Validation (POB) does not require excessive power measurement or processing capacity. Therefore, it is estimated that although the convention does not use 100% sustainable electricity, it is actually more practical and can be well adapted to climate change.

• The method of consuming tokens and digital currency is basically complete, so no mining tools or equipment is required to consume currency in the form of crypto. The team organization merger was canceled, resulting in uneven revenue in the region.

• Proof of Burn (PoB) ensures the health and safety of the organization by encouraging miners to use coins and tokens for venture capital (ignite) investments. Therefore, it guarantees the legitimacy and reliable behavior of the organizing excavators, and they do not want to stop guessing.

• In addition, it urges financial backers of completed projects to undertake obligations to keep current and ensure value strength.

• This agreement can also be used to enhance the creation of another token or the consumption of unsold digital currency in an ICO.

• Proof of Burn (PoB) also facilitates the decentralization of tokens and cryptocurrencies in a substantially more decentralized and reasonable way.

Disadvantages

• Depending on the framework, the tokens to be used may come from other digital currencies (such as Bitcoin) or alternative proof-of-work (PoW) measures. For some people, the convention has become a factor that is not yet well suited to the weather.

• Compared to the work done in the Proof of Work (PoW), the verification duty cycle El for each excavator is much slower.

• Due to the inability to guarantee the restoration of the quality of the consumed cryptocurrency or tokens, proof of burn (PoB) clients face the same risk as when they donated.

Digital currencies and tokens that utilization the Proof of Burn.

So far, the forms of digital currency agreed upon by this agreement are Slimcoin (SLM), Counterparty (XCP), and Factom (FCT). Slimcoin (SLM) is an open source digital currency that uses proof of recording, PoW, and PoS to form its tokens, just like consuming them in virtual PoB mining.
For its part, Counterparty (XCP) only uses PoB for the production of its tokens. In it, the client will send bitcoins to the user's address and will obtain a counterpart token.
Factom (FCT) again uses a mixed interaction method called "consumption and mint". In the Factom environment, tokens are continuously produced through methods related to corporate money. Then the token is again concentrated on the blockchain as information. Basically, the more the Factom network develops, the more tokens burned, and eventually the stock of tokens should decrease.

Conclusion

Consumption confirmation is a novel technology that is used to reach an agreement on the blockchain, and since it guarantees the guarantee of decentralization and there is no asset update tool, it can be used gradually. Some companies have effectively used the consumption of some coins as a way to help liquidate and increase the cost of their tokens, making them more attractive to financial supporters. Have any of you bought any form of cryptocurrency that proves to burn money? Do you think PoB is better than other protocol strategies (like job confirmation and proof of interest)? I can't imagine anything except hearing your contemplation.

Cc:
@steemitblog
@alphafx