Bram Cohen, creator of the BitTorrent protocol and the Chia Coin cryptocurrency, revealed this Monday on Twitter that he plans to launch his own decentralized exchange, as well as other decentralized finance (DeFi) products.
Last May, Chia Network President Gene Hoffman announced a public offering for sale (IPO) for the end of this year. On the 15th of that month, the value of the digital currency reached an all-time high of about $ 1,640.
However, since then the value of the Chia Coin has fallen by 85% and the token has a current capitalization of about 260 million dollars, according to data from the portal CoinGecko.
What is Chia Coin and why did it become so popular?
Chia Coin is a cryptocurrency of the Chia Network blockchain, which is based on the ‘Proof-of-Space-and-Time’ (PoST) algorithm instead of the ‘Proof-of-Work’ (PoW), as in the case of bitcoin. According to Cohen, PoST consumes less electricity than its rival by using storage disk space as a transaction validator.
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Users who donate their own disk space to support the network are rewarded for doing so: in this way, to mine Chia Coin, computational power is not used, but disk space. That is, anyone who has free space on their storage device can start mining the coin.
Interest in this digital currency began in mid-April, according to data from Google Trends. Its sudden popularity led to a shortage of hard drives (HDDs) and solid state drives (SSDs) in Hong Kong, which saw their average cost triple as demand increased. However, Chia Coin was not listed on any exchange in April. Currently, the currency is traded on Huobi’s Tether Stablecoin (USDT), Gate.io, OKEx, BKEX, and XT.com.
Is Chia Coin Mining Worth Starting?
According to official calculator for Chia, a 4TB hard drive could generate $ 0.26 per day, while a 10TB hard drive would produce $ 0.64 per day.
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However, the director of the cryptocurrency exchange service Alfacash, Nikita Soshnikov, commented to RBC that the profitability of mining this digital currency has fallen significantly compared to the spring due to the attraction of a large number of miners and the increase in equipment prices. Therefore, it is unlikely that a multiple return on investment will be expected in the coming months, the expert predicts.
“The coin was promoted through hype and got a fairly broad and decentralized network of miners, which is what was required to develop this ‘blockchain’ project,” he said.
Meanwhile, Eduard Bark, founder of the company EXMO Exchange, the information noise was too positive for the cryptocurrency. “Expectations are inflated, successes are hyperbolized,” he summarized.
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