This year’s buzzword in financial technology is undoubtedly ‘blockchain’. So what is it? Essentially, blockchain is the open-source public ledger that underpins cryptocurrencies including DasCoin. It is a digital record of information secured and verified through cryptography and can be used in anything from monetary transactions to passport details.
Traditionally, valuable information is stored in one place, by a bank, financial institution or government. But the blockchain method is different: instead of keeping that information in a single place, technology allows it to be distributed across a network of computers.
Each computer, or ‘node’ in the blockchain network has a copy of the blockchain – a chronological list of every transaction ever made. Once a transaction is added to the blockchain it can’t be edited or deleted. If any person or machine tries to change a copy of the blockchain without permission, all the other computers in the network reject any changes that do not match up to the ledger.
We believe this technology will be revolutionary in various sectors like finance, health and voting. However many people won’t be aware of the environmental implications of this technology on our world.
Blockchain Technology and Energy Consumption
While Bitcoin remains the most talked about cryptocurrency its limitations are currently being exposed. One of its drawbacks is the cost to the environment caused by its “miners”.
Mining is a crucial part of the process that allows the coins to be created. Miners compete with one another to create the next Bitcoin. Special software is used to solve highly complex mathematical problems which form a key part of the cryptography behind the blockchain.
According to the Bitcoin Energy Consumption Index, if Bitcoin were a country it would be using somewhere between Bahrain and the Slovak Republic’s energy. This is what a ‘proof of work’ blockchain looks like, and if this pattern of energy consumption continues, it may require all of the world’s current energy production in order to support itself. It is surely an unsustainable mechanism.
Minting: The DasCoin production process
DasCoin points the way to a better, cleaner environmental future with a long-term perspective. It cuts out the faults and focuses on the strengths of a number of existing systems. Principally, DasCoin uses minting instead of mining. To obtain DasCoin, Cycles from a license purchased through the Netleaders website are submitted to a Minting Queue, where they are placed behind all previously submitted Cycles and await further processing.
This process uses far less energy than the “proof of work” system that Bitcoin uses. DasCoin’s blockchain functions through a proof of stake protocol.
The highly efficient node architecture means that only highly maintained ‘master nodes’ have the ability to write to the blockchain. This avoids thousands of miners competing to validate the same block and therefore drastically reduces the energy consumption of the system whilst increasing performance.
You can visit the DasCoin blockchain here where you’ll see a block interval of just six seconds. The DasCoin blockchain fully confirms transactions in just six seconds, and always will, no matter how big the network grows.
It’s already producing great results for us given that DasCoin’s blockchain is now helping support fashion designers authenticate their designs. And it will continue to do so with innovations like DasPay – a mobile payments solution featuring both fiat and cryptocurrency on one application – set to come online in the summer.