In-depth analysis of computing power and value in the encrypted world of POW tokens

Author: WJB

For POW, there has always been a consensus in the industry, that is, "bear markets look at POW". This means that under the conditions of the bear market, when there are various problems in the industry and various methods are not feasible, POW will once again enter the mainstream field of vision and become the focus of everyone's attention.

Many friends who are not familiar with the blockchain will equate the blockchain with Bitcoin, thinking that the two are essentially the same, which is obviously biased. The function and meaning of the blockchain is more like the Internet, which is a general term, and Bitcoin is the most successful and important APP among them.

But there's one thing we can't deny: Bitcoin is where the blockchain began. The proof-of-work (POW) consensus mechanism of Bitcoin has also created a brand-new model. Countless POW tokens use this as a benchmark to achieve computing power and value in the encrypted world. So today, we will talk about POW tokens with you.

POW consensus mechanism, what is it worth? What are the core advantages?

The POW consensus mechanism, the full name of Proof of Work, is the proof of work established by Satoshi Nakamoto along with Bitcoin. Its emergence is mainly to solve the consensus problem to ensure the validity and reliability of the data. POW will require the node host to solve a complex mathematical calculation and publish the record on the network as evidence. If the solution successfully meets all the expectations about the solution, the node can get some token rewards and can be recognized by the network. recognized. It is worth mentioning that POW will require the attacker to split the computing power of the network first, because solving mathematical calculations requires a lot of time and computing power, and the computing power of the network increases with the use of the system, so such attacks are very difficult. Because of this, the POW model can effectively prevent organized malicious attacks.

For distributed ledgers, POW provides validity assurance for data, and realizes decentralization, which can achieve security in large networks. Usually, blocks in the network are verified based on mathematical calculations, which makes the original data more secure, because the data can only be recognized if the calculation meets certain requirements.

The shortcomings are also obvious! What are the challenges that POW tokens are currently facing?

High security, high data assurance, and the ability to achieve decentralization... These are the advantages of POW that cannot be ignored. However, in order to realize these core advantages, the POW consensus mechanism also pays a corresponding price.

First of all, POW consumes a lot of energy. As mentioned earlier, POW will require host nodes to solve complex mathematical calculations. These difficult algorithms must be supported by a large amount of computing power, otherwise the proof of work cannot be completed. This will inevitably lead to huge energy consumption. How much impact will this high energy consumption have on the environment? Is it sustainable? These are all questions that we need to think about in the future.

Secondly, the POW mechanism has extremely high requirements for hardware. If a POW token wants to be mined, it needs to be equipped with special hardware equipment, which has a high investment threshold. This high threshold is not very friendly to ordinary investors and users.

What's more worth mentioning is that although POW wants to build a high-end game of "who has the right to prove", there is a hidden problem behind it: once an entity has mastered more than 51% of the computing power, it may Attacks on the network will be a great hidden danger.

Hit the key! What are the dazzling POW projects in the current market?

POW is becoming more and more mainstream, and POW tokens in the market are also springing up like mushrooms after rain. Next, let’s take stock of the high-profile POW projects in the market this year.

When

Kaspa is a POW public chain based on the GHOSTDAG protocol. Compared with Bitcoin, Kapa has an obvious feature, which is to change the structural model of the blockchain. Bitcoin uses a single chain structure, while GHOSTDAG uses a directed acyclic graph (DAG) structure: one block can point to multiple blocks.

Kaspa's KAS currency will be launched in November 2021, with a total supply of 28.7 billion and a circulation of 19.8 billion, accounting for 69% of the total. The market value has reached 750 million US dollars, and the FDV (full circulation market value) has reached 1.08 billion US dollars. Since its launch, KAS currency has increased hundreds of times. Such achievements are inseparable from the reason why Kaspa itself has a strong development team and a solid foundation. At present, the market value of KAS currency is relatively high (750 million US dollars), ranking around 60 in the world.

However, investors also need to pay attention to that although the prospect of KAS currency is good, the potential selling pressure is relatively high. Early miners held a large number of low-priced chips, and new chips were produced every day. If these chips are sold off, it will have a huge impact on the price.

DNX

DNX Coin is a virtual currency created by DNX Capital, which builds a decentralized financial ecosystem. The goal of DNX is to create a powerful service platform for managing smart contracts and decentralized finance.

The technical features of DNX coins include smart contracts, on-chain governance, and anonymous transactions. Among them, smart contracts are the core of DNX coins, which provide developers with a fast and efficient way to build blockchain-based applications. In addition, DNX currency also provides a decentralized financial platform to provide users with financial services such as reinsurance, micro-insurance, and P2P loans.

DNX currency has performed well recently and has become a hot new star, especially it also has the advantage of "resistance to mining by ASIC mining machines", which other currencies do not have. But we still want to remind everyone here that DNX's future business scope will involve micro-insurance, P2P, etc., which is somewhat suspected of being "grey production". You still need to do more research, research, and calculations before investing.

The future development of POW, where will it go?

From the moment Bitcoin appeared, POW has entered everyone's field of vision, and it has been 14 years since then.

Because it has existed in the industry for too long, it has become the air and water in the industry, and it is an existence that everyone is very familiar with. Perhaps it is because the starting point of POW is too high, and the follow-up performance is rarely eye-catching, and there is a feeling of "the debut is the peak".

However, for POW, there is always a consensus in the industry, that is, "bear markets look at POW". This means that under the conditions of the bear market, when there are various problems in the industry and various methods are not feasible, POW will once again enter the mainstream field of vision and become the focus of everyone's attention.

After all, in times of recession, the main funds will be withdrawn from targets that are driven only by narratives (to put it simply, those projects that are not supported by strong technology and are only famous for telling a good story), and the remaining funds It will also become more pragmatic, and will focus on targets with objective value evaluation standards, and projects related to POW will also win based on this.