Steemit Crypto Academy Season 2 Week 5 Homework Task for @alphafx

Another wonderful lesson by professor @alphafx. He detailed the topic -consensus algorithm- in a simple fashion. From the lesson, I understood the Proof of Work, the Proof of Stake, the Delegated Proof of Stake, and realized that there are "Hybrid or Special consensus algorithms" that combine the principles of the originals.

I would like to discuss the Proof of Capacity consensus algorithm.

Proof of Capacity

In every mining network, something has to be contributed to the decentralized network. Cryptocurrency coins are given as rewards for the contribution to the network.

The Proof of Capacity consensus algorithm is a method that allows miners to commit the hard drive spaces of their machines in order to validate blocks in the network.

In Proof of Capacity -also known as Proof of Space, Proof of Storage, or Storage mining( in a less popular fashion)- possible solutions required for validation of blocks are stored on the hard drive. These possible solutions are implemented during the mining process to receive rewards. As a result of this, a bigger hard drive capacity has a better chance of validating blocks because they can store more possible solutions.

Pros of Proof of Capacity

• The Proof of Capacity consensus requires less electrical power compared to the outrageous power consumption of the Proof of Stake.

• Lack of specialization as anyone with extra space can contribute to the mining network without much complication.

• It solves the problem posed by the Proof of Stake consensus. In PoS, powerful nodes can lead to the disintegrity of the network. The Proof of Capacity consensus is ASIC resistant and this prevents powerful nodes from being malicious in the network.

From my research, I haven't found any shortcomings associated with the Proof of Capacity consensus. I think this is because the method has only been fairly implemented in certain projects. As this technology is used more frequently, maybe certain shortcomings associated would become known, maybe not.

Examples of Blockchains that Implement the Proof of Capacity Consensus

• Stork
• Burstcoin
• Chia
• SpaceMint

Chia

source

Chia is one of the few networks that utilize the Proof of Space consensus algorithm. It also makes use of another consensus algorithm in addition to the PoC, called the Proof of time. This network was created by Bram Cohen who is popularly known as the creator of BitTorrent.

The project, popularly called the "Green Bitcoin or Green Coin", has a lot of hype around it presently.

To make things more exciting, Amazon has now announced that Chia can be mined directly on the Amazon Web Services (AWS) cloud servers.
source

The network released its Whitepaper on February 9th of this year. Mainnet was launched on March 19, 2021 and transactions enabled just 2 months after, on May 3, 2021

source

Property	Detail
Rank	#2517
Self Reported Market Cap	$517,719,173
Self Reported Circulatory Supply	514, 760 XCH
Total Supply	21,514,760 XCH
All Time High	$1,749.38
All Time Low	$563.19
Current Price	$1,002.33

The properties tagged as "Self Reported" means that the values have not been verified.

Conclusion

The Proof of Capacity consensus algorithm has theoretically made up for areas where the Proof of Work and Proof of Stake proved problematic. This technology has yet to be intensively deployed and as a result of this, much can't be said about it. Let's watch out for the near future and see how good (or bad) the PoC proves to be.