Chia XCH/USD launched its mainnet on March 17, with the first transaction going through on May 3. This is in response to the idea of having cryptocurrencies reduce the carbon footprint they have with the eventual goal of hitting mass adoption.
In other words, it is a blockchain and a smart transaction platform created by Bram Cohen, who also invented the BitTorrent peer-to-peer protocol.
The interesting part about it, and the reason why it kicked off is due to the fact that instead of using the energy-inefficient proof-of-work (PoW) found in Bitcoin BTC/USD and Ethereum ETH/USD, to process the transactions and mine the coins, Chia uses a storage-based protocol that runs on a proof-of-space-and-time (POST) algorithm that uses unallocated disk space.
Should you buy Chia?
On June 3, Chia was valued at $703. When the transactions started on May 3, its value was at $1,498. This implies it is now trading at a 50% discount and investors should comfortably be able to buy on the dip.
Now, remember how we mentioned that instead of using processing power, Chia uses high storage space? Well, Chia has been a point of discussion in the cryptocurrency space as of late as the green alternative to its competitors.
A few months ago, Elon Musk, Tesla’s CEO posted on Twitter concerns when it comes to Bitcoin driving up fossil fuel consumption.
However, Chia’s demand is encouraging miners to get as much storage space as possible, which is actually causing high-capacity SSD’s to go out of stock in many markets. This in turn also drives their prices up, as there is a higher demand for storage.
An investment in storage
The hard drive maker Galax has warned users on May 1, without naming Chia, that mining cryptocurrencies that require a high amount of volume, as well as speed, will void the warranty of their SSDs.
We even heard from Jason Feist, who’s Seagate’s Managing Technologist for the Office of the CTO say that the company is experiencing strong orders and are trying to adjust to the market.
Bottom line: you can buy Chia now
When we see an influx of high-capacity SSD’s returning back to the market by the end of 2021, we can potentially see the value of Chia going above $1,000 without any issues.
Chia is definitely a currency that you should keep an eye on throughout the rest of the year. Chia has a clear catalyst that could push it to at the very least retest the $1,000 level in 2020 and as demand for storage rises and corporations switch to crypto-based solutions to this need.
We can also reasonably expect Chia to retest the $1,500 level in 2022 because there will be an increased desire for storage, which Chia delivers. Furthermore, once stock of SSD’s increases, a lot more people will be investing in its infrastructure indirectly that will raise its value further.