In simple and clear language, tell you what is and what are the characteristics of the recently normalized blockchain project Chia.
Written by: Leo Yang
Chia Network was founded in August 2017 by Bram Cohen, the founder of the peer-to-peer file-sharing software BitTorrent, and has successively received investment from 9 institutions and individuals including a16z, Naval Ravikant, Slow Ventures, and True Ventures.
Chia pursues environmental protection, efficiency, embraces supervision, and strives to build a safe and easy-to-use open source decentralized blockchain network, aiming to become a global payment settlement network system to meet the needs of sovereign countries, financial institutions, and large enterprises.
Technical characteristics
According to the description of its white paper, Chia uses the new Satoshi Nakamoto consensus -Proof of Space and Proof of Time. Under the premise of ensuring the lowest energy consumption, anyone can use a computer, mobile phone or enterprise-level network to mine as long as the device has a certain amount of storage space. No need for miners or deployment of dedicated GPUs. Chia’s business white paper reads:
“We expect that compared to Proof of Work (PoW) and Proof of Stake (PoSe), Chia mining (farming) will significantly reduce energy consumption and resource concentration.”
In order to ensure commercial application and customization, Chia independently developed the Lisp-based smart contract language Chialisp. According to the Chia team, the Chilalisp language is safe and concise, and is designed to meet the needs of banking, payment and financial applications and needs.
Unlike non-custodial assets in existing blockchains, Chia allows users to customize asset custody and clearing settings to prevent accidents such as key loss, hacker attacks, etc. Chialisp will also promote blockchain applications in compliance with “General Accounting Standards” (GAAP) and “International Financial Reporting Standards” (IFRS).
Other special features include:
- Multi-signature and atomic swaps: Allow companies to use multi-signature accounts to quickly complete transactions.
- Authorized receiving wallet: Set up a designated receiving account for a specific wallet to reduce the risk of attacks and misappropriation of funds.
- Transaction rollback: Allows the rollback of transactions within a certain block to meet the needs of transfer errors, shopping refunds, etc.
- Deploy ” color coin ” smart contracts to allow institutions to issue assets on the chain. The “Colored Coin” smart contract allows Chia on-chain applications to complete complex arbitrage transactions without “lightning loans”, perfecting DeFi applications.
- And limit the transfer amount, sub-account paper wallet, and decentralized identity.
Compliance
From the perspective of technology adoption and function settings, Chia is fully prepared for compliance.
As early as 2018, Chia Network applied to the US Securities and Exchange Commission (SEC) for a micro IPO, trying to raise funds from the public through Reg A+, but in the end Chia Network did not succeed, and another blockchain company, Blockstack, was approved by the SEC. Fundraising was completed through Reg A+.
Since then, Chia has slightly changed direction and plans to list on the U.S. stock exchange. After the mainnet goes live, Chia will apply to the SEC for an IPO at a suitable time.
Economic model
The Chia Network mainnet was launched on March 17, 2021, the native token XCH.
There is no upper limit on the total amount of tokens issued. Adopt a block reward halving measure similar to Bitcoin. The initial halving is as follows:
- Three years before the mainnet launch, each block will be rewarded with 64 XCH (a block every ten minutes)
- From the fourth to the sixth year, each block rewards 32 XCH
- From the seventh to the ninth year, each block rewards 16 XCH
- From the tenth to the twelfth year, each block rewards 8 XCH
- After twelve years, each block will be rewarded with 4 XCH
When Chia went online, the “Strategic Reserve” managed by Chia was created to receive 21 million XCH. The strategic reserve is used for Chia’s economic growth, shareholder rewards, or investment in Chia’s network application development. Chia also hopes to reduce XCH currency price fluctuations by using strategic reserves.
Mining
Mining such as Bitcoin and Ethereum requires a lot of electricity and specialized equipment. In comparison, Chia is more environmentally friendly, as long as the idle equipment has enough hard disk space, you can mine to earn revenue. The Chia team has stated many times that from this perspective, Chia can better achieve decentralization.
Chia mining requires two steps-equipment configuration (Plotting) and mining (Farming). The so-called configuration is to install and debug mining software on idle equipment. The configuration software needs to temporarily occupy about 332 GB of hard disk space. After installation, the software occupies 103.3 GB to 108.8 GB. After the installation is correct, you can start mining.
The mining process consumes very little broadband resources. Except for a certain amount of hard disk space, there is no other large resource consumption.
For Chia configuration hardware requirements and details, please refer to ” Chia Blockchain Wiki “.
to sum up
Chia puts special emphasis on the universal application of payment. Chia can be loaned to creditworthy institutions such as governments and financial institutions for asset issuance and market liquidity. At the same time, it helps global top 500 companies realize low-cost and secure cross-border payment solutions.
Chia’s vision can be summarized in one sentence in the white paper:
“One day we can use Chia to buy coffee in California. At present, banks, governments, and DeFi organizations will use it to build new financial technologies and solve cross-border problems, so that these will not be needed in the future without too many middlemen.”
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