Jan 7, 2019 23:20 UTC
Jan 8, 2019 at 11:07 UTC
How to Mine Cardano?
Cardano is a decentralized public blockchain and cryptocurrency project and is fully open source. Cardano is developing a smart contract platform which seeks to deliver more advanced features than any protocol previously developed. It is the first blockchain platform to evolve out of scientific philosophy and a research-first driven approach.
Agelos Kiayias, the chief scientist of IOHK came up with the method for mining Cardano(ADA). The method was verified mathematically and was also looked into by the peer network. This method registers the coin owners as slot leaders. The role of a slot leader is similar to that of a miner on Proof-of-Work system.
The ADA holders are able to create new blocks. They are also allowed to perform and validate new transactions. All the nodes on the network that abide by the rules of Proof-of-Stake system are registered as a stakeholder and get qualified to become a slot leader.
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How the Proof of Stake Help Cardano Network?
The Proof-of-Stake algorithm ensures that the process through which the stakeholder is selected is random and will be given the responsibility according to the stake they hold.
The relative value of their stake is calculated as a fraction of the tokens on a specific node divided by the total number of tokens in the system.
The stakeholder is registered as a slot leader when their node generates its first block. They will be making sure the transactions verified by the other nodes in the network are genuine.
Also, they would be generating new blocks for every set of transactions that are made and would assign private keys for each of them. Then these blocks would be added to the existing blockchain.
The time allotted to each slot leader to create a block is fixed and the system is designed in such a way that even a time period of 20 seconds could be fixed if the situation calls for it.
If the slot leader is unable to generate the block under the given time period, he/she will lose the authority of that block and it would be re-assigned to another slot leader.
“Follow the Satoshi” is another method to mine the Cardano(ADA). This method also works on the principle of random assignment. A coin would be selected at random by the algorithm and then the system will look for its owner. The owner of this coin then automatically becomes the slot leader. The probability of selection favors the one who has the put in the highest number of coins at stake.
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This method is a modification of the previous one where the selection was a bit electoral. It changed the algorithm to suit the standards that expect complete randomness.
This system is capable of generating passive income for a slot leader as all it requires from you is to keep your wallet open. The node will then perform and verify the transactions automatically which then fetches you the tokens assigned to it as transaction fees.
This algorithm acts as a cost-effective mining system for the slot leaders who have placed a large number of their coins at stake.