Sanjeev Sabhlok's notes on technology, hardware, gardening

Alt-coin Peercoin

on December 1, 2013, the top ten cryptocurrency market capitalizations were coins such as Peercoin, Namecoin, Megacoin, Feathercoin, Worldcoin, Primecoin, Freicoin, and Novacoin. At the time, one Peercoin (PPC), the “first proof-of-stake” token [Editor’s Note: Peercoin still uses proof-of-work for important parts of its system], was around $7 and held the fourth highest cryptocurrency market cap.

However, Peercoin now holds the 37th position and is only worth 30 cents per PPC. Many of the other cryptocurrencies that used to be in the top ten range are either close to worthless or have non-existent communities. [source]

Unlike bitcion and litecoin, there is no fixed limit on the number of peercoins in circulation. Instead, the circulation is designed to increase in perpetuity at a rate resulting in a steady 1 percent rate of inflation. Peercoin relies on the same proof-of-work mining protocol as bitcoin today, but the community plans to transition to a proof-of-stake system that can be described as “the rich get richer.” The peercoin algorithm will calculate the size of an individual’s holdings and issue a percentage of each new coin blocks proportionately across the community. The more coins you hold, the thinking goes, the more likely you are to successfully mine new ones. Peercoin holders also benefit by not spending or trading their coins, as the “static age” of a peercoin impacts its mining value.

One advantage of this system is that it is far greener than processing power-based mining, and eliminates the hardware arms race that is occurring currently in the bitcoin and litecoin ecosystems. Conversely, it also greatly benefits those who are early to the system, no one more than its creators.

Peercoin markets itself as using less energy and being more environmentally sustainable than some of the other coins on the market. It says it is designed to have a 1 percent rate of inflation.

Print Friendly, PDF & Email

sabhlok

View more posts from this author

Leave a Reply

Your email address will not be published. Required fields are marked *