- Chia “farmers” are likely behind a surge in demand for hard drives in the European market
- Mining the XCH cryptocurrency requires large amounts of computer storage
- Chia is designed to be an environmentally friendly cryptocurrency
Chia “farmers” are buying up hard drives in Europe, research firm says
Chia is a cryptocurrency that maintains consensus through a concept called Proofs of Space and Time, in an attempt to create a more environmentally friendly cryptocurrency.
In Bitcoin’s Proof-of-Work system, the network arrives to a consensus through “miners” performing resource and energy-intensive computations. In Chia, consensus is reached through “farmers” storing cryptographic information on unused sections of their computer storage. The more space a farmer allocates, the bigger chance they have of adding a new block to the blockchain and earning the associated XCH reward.
The “farmers” who want to earn XCH instead of buying it on an exchange need a lot of storage, and this has been reflected in demand for hard drives. The Register cites figures from research company Context, which reveal that in April 2021, 240% more enterprise-grade hard drives with a capacity of 10 terabytes were sold in Europe than in April 2020. Sales of NAS (network attached storage) and surveillance disk drives also saw increases of 167 and 116 percent, respectively, in the same time period.
Gurvan Meyer, a senior enterprise analyst at Context, told The Register that the large increase in demand for storage is caused by Chia:
“It has taken everybody by surprise following the launch of Chia. Even Western Digital and Seagate were not expecting high demand like this.”
One of the factors contributing to the excitement about Chia is the fact that the cryptocurrency was created by Bram Cohen, who also invented the BitTorrent peer-to-peer file sharing protocol. In May, Chia raised $61 million in an investment round which included backers like Richmond Global Ventures and Andreessen Horowitz. Unlike most cryptocurrency projects, the Chia team is planning to take the company public.
XCH, the native cryptocurrency of the Chia network, is currently trading at around $531. The cryptocurrency hit the open markets in early May, and its price peaked at around $1,600 before the market was hit with a strong correction.
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