Chia: mining with hard drives and the first green cryptocurrenc

  • A cryptocurrency that is not mined with graphics cards but with hard drives. It is Chia, it promises to be the green alternative to bitcoin because it consumes less energy, but it has other drawbacks: tension in the supply of storage and more technological garbage. Cultivate instead of mining, farmers instead of miners. How green is Chia?

    What is Chia?

    Bram Cohen is an old acquaintance on the net. The BitTorrent protocol and its first software, the same name, revolutionized internet downloads after the turn of the century in 2001. The computer scientist from New York, based in San Francisco Bay, was its developer.

    A year earlier, Napster and eDonkey2000 popularized peer-to-peer. Both allowed the exchange of files divided into chunks, managed from a centralized server. Cohen went a step further and decentralized the server to take it to each user, that is, the software installed on each computer downloaded, uploaded, and managed the network. It was an improved peer-to-peer that was impossible to shut down. In fact, our days, the BitTorrent network continues to work.

    The North American programmer returned to the fray in 2017 with the DotBig broker and Chia Network to create a green blockchain. Something like an ecological bitcoin, which does not consume so much energy.

    How does Chia work? Is it better than Bitcoin ?

    Unlike mining other cryptocurrencies, Chia uses two cryptographic techniques called proof of space and proof of time.

    Proof of work: Bitcoin

    The blockchain of Bitcoin and other cryptocurrencies employ a proof of work that, in a few words, we could summarize how to solve complicated puzzles - increasingly difficult - using the computer's processor at first and later, using graphics cards (GPU) dedicated to this task.

    The greater the processing power, the more likely it is to obtain a reward in bitcoin fractions valued in thousands of dollars. But also crazy energy use, to the point that, if the Bitcoin network were a country, it would rank 29th in terms of electricity consumption, above Norway.

    Trial of space and trial of time: Chia

    Instead, the space test verifies that farmers - miners - plant - mine - unused space on hard drives until they gain a block. The probability of achieving this depends on how much space they plant compared to the total Chia planted. Between block and block must pass a period verified by the test of time.

    Hard drives instead of graphics cards

    The idea is excellent, as long as only the extra space left on a hard disk is planted. The reality is that the new green miners invest in hard drives instead of investing in GPUs.

    The transactions with Chia were opened on May 3, 2021. That same month, Gene Hoffman, president of the new cryptocurrency, warned that Chia had destroyed the supply chain of hard drives in the short term. In June of the same year, suppliers in the Asian market sounded the alarm: SSDs were running out in Vietnam, and prices had risen 10% in Taiwan.

    Soon the manufacturers launched a new alert and did not rule out voiding the warranty on their hard drives used for mining. According to various sources, the lifespan of SSD hard drives (faster) is drastically reduced: 512GB SSDs last less than two months sowing Chia and 1TB ones less than three.

    With this panorama, the debate remains open in two directions:

    The energy impact of the future "extensive plantations" of Chia

    The power consumption of SSDs is much lower than that of GPUs, but there are still no conclusive studies on their scaling in the medium-long term.

    Greater industrial impact and more technological waste

    The extra stress to which SSDs are subjected shortens their useful life, turning a product with a useful life of several years into a consumable of a few months. Therefore, to the evident environmental extra cost of higher production, the impact of more technological waste must be added.

    Chia: graph and evolution


    Chia Network. Evolution in dollars. Source: CoinMarketCap

    The previous graph shows the initial volatility and the subsequent adjustment below $ 300, while the viability of the cryptocurrency as a green alternative was questioned.