The chapter deals with the possibilities and limits of payment verification in cryptocurrencies. The verification of cryptocurrency transactions using the Proof of Work (POW) system, or cryptocurrency mining, works on the principle of demanding mathematical calculations, which requires a large amount of electricity and, for example, generates waste heat when mining with graphic cards. In response to this issue, another system, Proof of Space and Time (POST), has emerged, referred to as cryptocurrency farming, and it is supposed to be a greener version of cryptocurrency mining. The aim of this chapter is to describe the most well-known principle of payment verification by the POW mining system and to describe the new principle of payment verification by the POST farming system. Another goal of the chapter is to determine, through an experiment, whether farming cryptocurrencies using the POST system is a greener option for verifying payments than mining using the POW system. The verification was done using a home experiment with a single mining machine mining the cryptocurrency Ethereum and a cryptofarm farming the cryptocurrency Chia.

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Mining and Farming of Cryptocurrencies: Comparison of Economic and Environmental Demands

  • Ondřej Malý,
  • Marie Hubálovská,
  • Štěpán Hubálovský

摘要

The chapter deals with the possibilities and limits of payment verification in cryptocurrencies. The verification of cryptocurrency transactions using the Proof of Work (POW) system, or cryptocurrency mining, works on the principle of demanding mathematical calculations, which requires a large amount of electricity and, for example, generates waste heat when mining with graphic cards. In response to this issue, another system, Proof of Space and Time (POST), has emerged, referred to as cryptocurrency farming, and it is supposed to be a greener version of cryptocurrency mining. The aim of this chapter is to describe the most well-known principle of payment verification by the POW mining system and to describe the new principle of payment verification by the POST farming system. Another goal of the chapter is to determine, through an experiment, whether farming cryptocurrencies using the POST system is a greener option for verifying payments than mining using the POW system. The verification was done using a home experiment with a single mining machine mining the cryptocurrency Ethereum and a cryptofarm farming the cryptocurrency Chia.