Smart Mining — Reinventing the Cryptographic Puzzle to Make it More Meaningful
Dynex about cryptocurrency mining, energy efficiency, our environment and the need to find a more sustainable and meaningful way to perform mining computations, leading to a new, innovative mining algorithm: DynexSolve.
Cryptocurrency mining is the process by which new coins are entered into circulation. It is also the way the network confirms new transactions and is a critical component of the blockchain ledger’s maintenance and development. “Mining” is performed using sophisticated hardware that solves a computational math problem. The first participant to find the solution to the problem receives the next block of coins and the process begins again.
The coin reward that miners receive is an incentive that motivates people to assist in the primary purpose of mining: to legitimise and monitor transactions, ensuring their validity. Because many users all over the world share these responsibilities, we all it “decentralised”, or one that does not rely on any central authority like a central bank or government to oversee its regulation.
But crypto has a dirty little secret that is very relevant to the real world: it uses a lot of energy. How much energy? Bitcoin, the world’s largest cryptocurrency, currently consumes an estimated 150 terawatt-hours of electricity annually — more than the entire country of Argentina, population 45 million. Producing that energy emits some 65 megatons of carbon dioxide into the atmosphere annually — comparable to the emissions of Greece — making crypto a significant contributor to global air pollution and climate change.
And crypto’s thirst for energy is growing as mining companies race to build larger facilities to cash in on the 21st century gold rush. We have CPUs, GPUs, FPGAs and ASICs solving cryptographic puzzles, of which there are a lot of different variations of it (SHA-256, Ethash, Equihash, Cryptonight, X11, RandomX, Autolykos2, CuckooCycle, Cuckaroo,Beam, the list is endless). Some of them position themselves to be “ASIC resistant”, which means there is (currently) no ASIC available to mine that specific algorithm, usually because of memory requirements or because nobody produced an ASIC yet.
What all of these mining algorithms have in common is:
a) finding the solution is a computational intensive process, but one whose difficulty can be adjusted to the current “hash-rate” of the network; and
b) the found solution can be easily verified.
To earn new coins, you need to be the first miner to arrive at the right answer, or closest answer, to a numeric problem. This process is also known as proof of work (PoW). To begin mining is to start engaging in this proof-of-work activity to find the answer to the puzzle. No advanced math or computation is really involved. You may have heard that miners are solving difficult mathematical problems — that’s true but not because the math itself is hard. What they’re actually doing is trying to be the first miner to come up with a 64-digit hexadecimal number (a “hash”) that is less than or equal to the target hash. It’s basically guesswork.
So it is a matter of randomness, but with the total number of possible guesses for each of these problems numbering in the trillions, it’s incredibly arduous work. And the number of possible solutions (referred to as the level of mining difficulty) only increases with each miner that joins the mining network. In order to solve a problem first, miners need a lot of computing power. To mine successfully, you need to have a high “hash rate,” which is measured in terms gigahashes per second (GH/s) and terahashes per second (TH/s).
To summarise, cryptocurrency mining consumes an estimated 150 terawatt-hours of electricity annually — more than the entire country of Argentina, population 45 million, producing that energy emits some 65 megatons of carbon dioxide into the atmosphere annually — comparable to the emissions of Greece while basically doing guesswork.
We think everybody agrees with us, this doesn’t make much sense. Or at least, there must be a way to make this process more meaningful for everybody.
At Dynexcoin for example, we are currently using two different proof-of-work schemes in parallel: The “regular” PoW to mine and confirm transactions within the Dynex blockchain (in the moment Cryptonight) and the PoW where solutions are submitted while running our Dynex Chip on the user’s equipment.
What basically our Dynex Chip is doing is simulating (by numerical integration of equations of motion) a neuromorphic circuit we have designed over the last two years. Alone that simulation is orders of magnitude faster in solving computational problems than existing methods. There are numerous use-cases, for example, a logistic company wants to optimise routing and shipping, an airline wants to improve loading of their planes, an automotive company seeks better performance of their engines or researchers want to find answers to problems related to health or our environment.
In the Dynex network, such computations are being performed jointly by all Dynex chips in the network collaborating in a decentralised way. In fact, the intend is to build the world’s first decentralised neuromorphic computing platform together with our community.
The DynexSolve Algorithm
We have been doing a lot of thinking and lab-research and we believe it is possible to entirely replace any regular PoW scheme with Dynex Chip computations. Rather than brute-forcing random hashes, we can perform meaningful computations. Do we even need two different schemes in parallel? We don’t. Dynex Chip operations already fulfil the two core requirements of any mining algorithm, there is no short-cut or any other way of finding a solution than running the Dynex Chip simulation, and the computational result can be verified instantly.
For us, this makes perfect sense. The DynexSolve algorithm is (at least to our knowledge) the first mining algorithm which solves real-world computational problems while providing Proof-of-Work during the mining process. As larger memory is required and the problems to be solved are constantly changing, this algorithm is perfectly suited for CPU and GPU miners. Energy consumption of the process is very low compared to brute-force hashing (we will publish its energy efficiency when we officially publish the DynexSolve algorithm) and every single computation contributes to solving real world problems. Effectively, mining moves from hashing to numerically integrating equations of motions, or simpler said: Mining is becoming smart.
We are working on publishing the technical details of the DynexSolve algorithm shortly. Make sure to check in with us soon again.
The World’s First Decentralised Neuromorphic Supercomputing Platform
Dynex is a next-generation platform for neuromorphic computing based on a groundbreaking flexible blockchain protocol. It consists of participating nodes that constitute a decentralised neuromorphic supercomputing network which is capable of performing computations at unprecedented speed and efficiency — even exceeding quantum computing. By transforming traditional inefficient computers into neuromorphic chips, we will finally be able to create new discoveries. To achieve this, every computer, every laptop and even every mobile device available needs to be connected. As a community and with collaborative effort we can take the next step towards sustainability and efficacy. Transform your phone, your old computer or your dormant mining equipment into neuromorphic machines, earn money and generate wealth.