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Will the halving effect of PoW currencies steer a renaissance for the PoW ecosystem?

6min Read
CoinEx

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In 2023, the PoW track gave birth to a phenomenon—Kaspa, causing a sensation in the cryptocurrency field. Since the launch of the Kaspa manner, its token KAS has surged by over a hundredfold, leading to many small and medium market cap coins being sought after by the market. On April 4th this year, BCH completed its halving, with the price of BCH rising by 147.85% in nearly 3 months, surpassing $700 at one point. Similarly, with the Bitcoin halving approaching, the price of BTC has soared by as much as 55.28% in nearly 3 months, skyrocketing from $40,000 to $67,000. Furthermore, more and more coins are choosing to utilize GPUs in more meaningful ways, including integrating with AI, renting hash power, and Train-to-Earn initiatives, rejuvenating the PoW ecosystem, and demonstrating renewed vitality and growth.

Prospects for PoW Ecosystem Development

In 2024, the PoW ecosystem is in a period of great potential, poised to spark a new wave of enthusiasm with the upcoming Bitcoin halving event.

Firstly, as the cryptocurrency market continues to mature and develop, the PoW algorithm, as one of the earliest consensus mechanisms applied to cryptocurrencies such as Bitcoin, will continue to play a significant role. Despite new consensus mechanisms such as PoS (Proof of Stake) emerging, PoW, known for its high level of decentralization and resistance to attacks, is still widely regarded as a secure and reliable consensus algorithm.

Secondly, with the continuous progress and innovation in blockchain technology, the PoW track has seen more innovations, ushering in a series of new projects by effectively integrating PoW with AI, IoT, and other technologies, enabling coins to have more practical use cases.

  • PoW + AI Trend

Due to GPU’s proficiency in parallel computing, it is well-suited for running AI models like deep learning, allowing miners to accelerate the training and inference processes of AI models. With the rising popularity of AI, the narrative of PoW + AI is more likely to attract attention from the crypto market, as seen in projects like Bittensor (TAO) and Clore.AI (CLORE).

Bittensor (TAO) is a peer-to-peer intelligence market, combining PoW and AI to form a decentralized marketplace for large AI algorithm models, aimed at driving innovation and sharing in AI technology. Miners in the Bittensor network need to provide computing power to run AI models. (For more information, please refer to: https://www.coinex.com/en/info/TAO)

Clore.AI (CLORE) is an AI computing power leasing platform equipped with nearly 6000 high-end Nvidia GPU chips that can be rented for mining, rendering, AI training, etc. In their business model, individuals with Nvidia GPU computers can connect their GPUs to the network and earn CLORE tokens as incentives. (For more information, please refer to: https://www.coinex.com/en/info/CLORE)

  • PoW + IoT Trend

PoW can provide decentralized, secure, and trustworthy infrastructure support for the Internet of Things (IoT) while achieving decentralized and fair incentive distribution, such as the Neural project.

Neurai (XNA) is a PoW chain focusing on AI and IoT, aiming to leverage the power of artificial intelligence algorithms for efficient data analysis, predictive modeling, and decision-making, using PoW to address distribution limitations and lack of transparency. It can also connect blockchain assets with IoT devices for wider application scenarios. (For more information, please refer to: https://www.coinex.com/en/info/XNA)

Whether in partnership with AI or IoT, PoW plays a crucial role in improving the speed and efficiency of decentralized networks. By introducing new algorithms or technologies, PoW coins can have longer-lasting development potential, opening up new possibilities for the development of the PoW track.

Challenges Facing the PoW Ecosystem

Bitcoin’s Proof of Work (PoW) consensus mechanism pioneered a new model, serving as a benchmark for numerous PoW tokens and contributing to the computational power and value in the crypto world.

However, the PoW ecosystem still faces various challenges:

  • Difficulty in meeting transaction demand

Compared to token projects, PoW projects face challenges in meeting user transaction demands. Due to the high development barriers and complexity of PoW projects, along with an incomplete ecosystem (such as the lack of mature decentralized exchanges DEX) and insufficient support from centralized exchanges CEX, PoW coins currently have poor liquidity, making it challenging to meet user transaction demands, resulting in inconvenient trading and high risks in OTC trading.

During the past year, some incidents in the industry further highlighted these issues. For example, the closure of the small mining coin exchange Txbit and exposure of issues like SafeTrade’s suspected Rug Pull have caused significant trouble for mining coin investors. These events indicate weaknesses in PoW projects in the trading area, requiring further improvements and development. Users may consider selecting the established and professional mining coin exchange CoinEx to enhance their trading experience.

  • Regulatory pressure on privacy PoW coins

In recent years, with governments worldwide strengthening regulations in the cryptocurrency field, privacy-focused PoW coins like Monero (XMR) are facing increasing regulatory pressure. Due to their support for anonymous transfers, these coins make it difficult for regulatory authorities to trace transactions, posing risks of being utilized for money laundering, illegal financing, and other illicit activities. As a result, some countries and regions have adopted strict regulatory stances on privacy coins, prohibiting exchanges from listing them. Additionally, some exchanges have started delisting private PoW coins to comply with regulatory requirements. In general, private PoW coins are facing growing regulatory pressure, with their future development prospects subject to observation.

  • Security

Small-scale mining coin projects on the market have lower total hash rates, making them more vulnerable to 51% attacks and other malicious activities. The existing hash power rental market allows attackers to temporarily rent sufficient hash power to launch attacks, with attackers only needing to control over 51% of the hash power to execute a 51% attack, including double spending and preventing transaction confirmations. The specific costs can be found on the 51% Attack Cost website: https://www.crypto51.app/.

Preferred Platform for Mining Coin Trading: The Unique Charm of CoinEx

Currently, CoinEx is one of the most comprehensive mining coin exchanges on the market.

As a secure, professional, and reliable cryptocurrency trading platform, CoinEx is dedicated to supporting promising high-quality cryptocurrencies, offering a wide range of PoW coin trading pairs and coin market information to meet diverse user needs and actively contribute to the development of the PoW ecosystem.

CoinEx has become renowned for its comprehensive coin listing strategy, including rapidly launching projects with potential and providing extensive asset support to users. Its unique “good, fast, comprehensive” coin listing strategy encompasses the following aspects:

  • Curating high-quality assets

Before listing, CoinEx conducts professional and comprehensive evaluations of cryptocurrency projects from various dimensions, including technical aspects, community, and token economics, to deeply explore cryptocurrencies with high potential.

  • Rich and prompt cryptocurrency selection

CoinEx was among the early platforms to support KAS trading, launching KAS in November 2022, alongside cases like the listing of FLUX in May 2021 and XNA in August 2023. Since its inception, CoinEx has maintained a keen observation of the PoW ecosystem, continuously and swiftly uncovering potential projects, and providing comprehensive technical development support to PoW projects based on its excellent technical development capabilities.

  • Extensive and complete cryptocurrency support

The global cryptocurrency trading platform CoinEx has supported as many as 900+ high-quality assets, strongly supporting the development of the PoW ecosystem. The platform has listed hundreds of PoW coins, including projects with various consensus mechanisms, providing real-time tracking of market trends and coin price changes, offering users comprehensive coin market information to grasp market dynamics.

Therefore, CoinEx Exchange is well-known for its excellent coin listing strategy, including promptly launching high-potential projects and providing comprehensive asset support to users, garnering widespread acclaim. For more PoW coin trading, visit CoinEx: https://www.coinex.com/en/markets/coin?tag=7&page=1

 

Disclaimer: This is a paid post and should not be treated as news/advice.

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