Proof of Space
Blockchain networks employ Proof of Space (PoSpace), often referred to as Proof-of-Capacity (PoC), as a consensus mechanism algorithm. Instead of depending on processing power (like Proof of Work, or PoW) or a stake in cryptocurrencies (like Proof of Stake, or PoS), it enables users to mine or validate transactions based on the amount of hard drive or disc space they assign.
Key Components of PoC
An outline of the main elements of PoC is provided below:
Plots: Miners’ files containing pre-calculated cryptographic solutions. Larger plots increase the likelihood that a block will be successfully mined, and miners use these plots to swiftly construct proofs for mining.
Mining Nodes: Network users that donate hard disc space for transaction mining and validation. Plots are stored by nodes, which also participate in the mining process by producing and submitting proofs.
Proofs: Cryptographic evidence produced using the information kept in the miners’ plots. Proofs are sent to the network for validation and show that a miner is capable of taking part in the consensus process.
Consensus Mechanism: The algorithm that network participants employ to reach consensus and validate proofs. Only valid proofs are accepted, ensuring blockchain security and integrity.
Block Creation: Creating a new block by combining a number of verified transactions.The ledger is updated when the new block is uploaded to the blockchain and successful miners are rewarded.
Rewards System: Miners are given incentives for joining the network. Bitcoin rewards miners for mining blocks, encouraging active participation.
Mechanism
Proving Space Allocation: The data that a prover gives to a verifier to demonstrate that they have set aside a specific amount of space is known as a proof-of-space. The verification procedure should be quick and need little time or space. It should be challenging for the prover to pass verification without really allocating the specified amount of space in order to ensure soundness.
Implementation Method: Using hard-to-pebble graphs is one method of putting Proof of Space into practice. In order to do this, the prover is asked by the verifier to construct a labelling for the graph, commit to it, and then open many random points within the commitment.
Plotting: Miners set aside a portion of their hard drive space to form “plots” during this first, one-time setup step. Plots are files that include pre-calculated answers to cryptographic riddles. Plotting can be a laborious operation that uses a lot of storage space. For example, repeated hashing is used to generate a list of all possible nonce values, with 8192 hashes paired into “scoops” for each nonce.
Mining/Farming: Users are referred to as “farmers” when the hard drive has been plotted. Miners swiftly look for reliable evidence when a new block is submitted by using the plots they have saved. A miner’s chances of getting chosen to mine the next block and receive the mining reward increase with the size of their hard drive or the amount of storage space they have set aside.
Proof Generation and Consensus: Miners show that they can contribute to the consensus process by producing a proof based on the information in their plots. The network is then asked to validate this proof. These supplied proofs are validated by the network using a consensus procedure. In order to preserve the integrity of the blockchain, miners who provide convincing proofs are rewarded by having their block added.
Deadline Calculation (Example): Miners compute a scoop number and then use the scoop’s data to generate a “deadline” value in systems such as Burstcoin (now Signum). The amount of time in seconds that must elapse before a miner can create a new block is represented by this deadline. If no one else forges a block within the allotted period, the miner with the minimum deadline will have the opportunity to forge the subsequent block and get the prize.
Origin and Evolution
- Both Dziembowski et al. (2015) and Dziembowski et al. and Ateniese et al. (2013) developed the idea of Proof of Space.
- Because of its general-purpose storage and less energy costs, Proof of Space was investigated as a more equitable and environmentally friendly option to Bitcoin’s Proof of Work (PoW) mining method after its launch.
Advantages and Benefits
Energy Efficiency: Because Proof of Space uses disc space instead than continuous, demanding computations, it uses a lot less energy than energy-intensive PoW techniques. Compared to ASIC-based Bitcoin mining, it may be up to 30 times more energy efficient, according to certain reports.
Lower Hardware Costs and Accessibility: Mining becomes easier by eliminating the need for expensive and specialized equipment and allowing participants to use current storage devices and consumer hardware. Promotes diversity and allows more people to participate.
Decentralization: Proof of Space can foster a more decentralized network and lessen the concentration of mining power in the hands of a select few by allowing users with different hardware capabilities to participate and enticing more users to contribute storage.
Enhanced Security: A lot of disc space makes it harder for hostile actors to take over or attack the network, improving its security and resilience.
Sustainability: PoC reduces energy use and uses hardware resources to address environmental challenges associated to traditional mining and develop a more sustainable blockchain system.
Reusability of Drives: It is simple to wipe out and reuse hard discs used for PoC mining for different types of data storage.
Quick Proof Generation: The overall effectiveness of transaction validation and block formation is increased by the use of pre-computed plots, which enable quicker proof generation throughout the mining process.
Challenges and Limitations
Storage Centralization Risk: Although decentralization is encouraged, there is a chance that over time, storage resources may be concentrated around a small number of powerful miners, which could result in centralization problems like to those in PoW systems.
Disk Space Wastage: Significant quantities of disc space are used during the plotting process, which could result in resource waste if the allotted space is not used for mining.
Initial Setup Time: Some prospective miners may be put off by the lengthy process of creating plots, which necessitates a large upfront investment in system resources and storage space.
Vulnerabilities: PoC is still vulnerable to some types of assaults, like Sybil attacks, in which a hacker assumes several identities in order to exert excessive influence. Mining operations may potentially be impacted by malware.
Limited Adoption: PoC is less popular than more well-known consensus techniques like PoW or PoS, which may have an effect on the value and liquidity of cryptocurrencies that use it.
Hardware Lifespan Concerns: Because of the high write activity required for plot generation, some implementations, like Chia, have been under fire for possibly reducing the lifespan of storage devices, especially solid-state drives (SSDs).
Use Cases and Examples
- Beyond Cryptocurrencies: In classic client puzzle applications, such spam prevention and denial of service attack defence, Proof of Space can be used in place of Proof of Work. By evaluating a processor’s L1 cache, it has also been used to detect malware.
- Decentralized Storage: PoC can be applied to file-sharing programs, decentralised storage platforms, and even Internet of Things (IoT) devices that have storage features.
- Other Applications: It can support community networks where users share storage resources, improve supply chain management transparency, and be incorporated into blockchain-based gaming and NFT marketplaces.
- Notable Cryptocurrencies using Proof of Space/Proof of Capacity:
- Burstcoin (now Signum): It was the first real-world application of a PoS/PoC blockchain technology, having been introduced in August 2014. According to its claims, it has a green algorithm that rewards smaller miners, lowering transaction costs and promoting decentralisation inside the network.
- SpaceMint: This cryptocurrency, which was first proposed in 2015, aims to address real-world design issues with pebbling-based Proof of Space schemes. Additionally, it tackles the “nothing-at-stake” issue by penalising fraudulent miners through transactions.
- Chia Network: A well-known example that combines Proof of Time with Proof of Space. Its proof-of-time technique and plotting procedure have sparked worries about the high write activity reducing the lifespan of SSDs, even though its plots don’t contain any useful data.