Cryptocurrency platform Chia is being blamed for shortages of hard drive storage devices, which are used to mint new tokens.
Chia, created by BitTorrent founder Bram Cohen, is designed to remove the massive power draw currently seen by crypto assets like Bitcoin and Ethereum by using a “proof of space and time” system.
Proof of space and time uses hard drives to store massive amounts of data, with rewards being given to users who have the largest amount of data stored. This removes the need for large “rigs” with multiple graphics cards running constantly to solve the equations used in proof of work systems, like Bitcoin or Ethereum.
The increasing value of crypto assets has caused miners to buy hard drives at an alarming rate, particularly large capacity drives and high-end Non-Volatile Memory (NVMe) solid state drives.
According to crypto expert David Gerard of Libra Shrugged, Chia’s proof of space time system is already affecting the market for storage devices and will waste nearly the same level of resources as popular crypto assets like Bitcoin.
“Chia claims to do decentralisation just like bitcoin: waste some resource as unfakeable proof that you are claiming a share of the winnings,” Gerard says. “Instead of just wasting electricity, Chia chews through SSDs at a fantastic rate, and also has thoroughly wrecked the market for big HDs.”
The global microchip shortage has exacerbated the problem, with experts expecting that shortages coupled with rising demand for mining hardware will continue to drive up prices for the average consumer.
Cryptocurrency in general has been under heavy scrutiny in recent weeks, with the Binance exchange under investigation by the U.S. Justice Department for money laundering, and Bitcoin mining in Iran being halted until September due to power outages.
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