Cryptocurrency miners in China join forces to mine Chia, a “green” cryptocurrency that comes from hard drives. The boom is causing price increases as well as shortages.
The rise of a Chia (XCH), a new cryptocurrency that claims to be green and comes from hard drives for extraction, seems imminent. The cryptocurrency is becoming very famous among miners in China, and this situation is causing an increase in demand for hard drives among manufacturers in Asia.
A report in Retail News Asia noted that large capacity hard drives are practically out of stock in Vietnam due to an invasive demand. According to the news agency, local merchants take advantage of the demand to buy hard drives in bulk and resell them in the Chinese market.
Although the digital currency has yet to start trading, Chinese investors seem very keen on mining or mining it. Chia announced in March that its cryptocurrency’s mining is coming from a hard drive or SSD rather than a CPU, GPU, or ASIC (cryptocurrency mining equipment).
The excitement about the new cryptocurrency seems to have inevitably caused a price increase on these storage cards.
What is Chia, and How did this Fever Start?
The euphoria among Chinese investors for cryptocurrency appears to have started in April, shortly after the Chia storage network announced the launch of its mainnet for mining in late March.
Chia Network is a US-based startup that focuses on building a “green blockchain for digital work”. Chia appeared for the first time in 2017 by Bram Cohen, who is also behind the BitTorrent protocol. Chia Network offers a decentralized storage network that decided this year to launch a revolutionary “green” Blockchain with its native token (XCH).
The Chia network bases its core on a consensus algorithm called Proof of Space and Proof of Time (PoST). The algorithm allows network participants to demonstrate that they have expended a “space-time” resource, which means that they have allocated storage capacity to the network.
According to The Block, the idea behind Chia is similar to Filecoin: replacing the consensus proof-of-work (PoW) that Bitcoin uses for mining and consumes large amounts of electrical energy with PoST. Similar to Filecoin, Chia mining also has two steps: tracing and cultivating.
The Shortage of Hard Drives is Real
The lifespan of SSDs is usually facing limitations. Although these limitations may vary for different models, in general, SSDs can only perform a restricted number of delete cycles before becoming unreliable. So, investors interested in Chia are anticipating these limitations to buy as many hard drives as possible.
Recent reports suggest that the growing interest in Chia is affecting the hard drive market in similar ways to what Bitcoin has done to the GPU market: rising prices and letting shortages take the lead.
Since the very beginning, there has been a change of 100% in prices of various hard drives between Chinese businesses such as Taobao JD.com.
By: Jenson Nuñez