New Cryptocurrency May Lead To Hard Drive Shortages

The rise in popularity of the new cryptocurrency ChiaCoin could lead to a shortage of hard drives and solid state drives in the consumer market. In Hong Kong, the average price for HDD has already tripled.

ChiaCoin was invented by Bram Cohen, the creator of BitTorrent. Unlike traditional cryptocurrency mining algorithms, which rely heavily on GPUs or ASICs, ChiaCoin relies on solid state drives and hard drives.

Bram Cohen believes that bitcoin and other cryptocurrencies running on the Proof-of-Work (PoW) algorithm use too much electricity, writes RBC.

Chia runs on a Proof-of-Space-and-Time algorithm and uses disk space as a transaction validator. Users who provide their own disk space to support the network are rewarded for this.

The process itself is called farming, not mining, since the principle of mining is different: the more data a user can place in his farm, and the faster access to it, the higher his chance of receiving a reward.

The Chia Network is currently in beta testing and the ChiaCoin blockchain coin is not yet listed on any of the exchanges.

However, users in China have already begun to massively buy hard drives and SDD drives for the future; drives with a volume of 4 to 18 terabytes are especially popular.

Given the concentration of production in China, the shortage of storage devices will first affect the domestic market and then spill over to the external one.

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