Place/Date: London, United Kingdom - June 28th, 2018 at 7:55 pm UTC · 3 min read
Contact: Dilip Chandar, Source: DICE
One cryptocurrency, DICE stands out from the rest because of the fact it does not need the support of Blockchain technology. Let us understand a bit about DICE and its mining methods.
DICE (Digital Certificates) are small blocks of data that are difficult to make. The process of making DICE blocks is known as mining. Mining of DICE requires significant computing power. This computing power gives the minimal intrinsic value to DICE in the same way banknotes, and coins issued by central banks carry inherent value.
DICE works on the cluster-based approach rather than the single ledger methodology that the Blockchain technology uses. You have the concept of the miner excavating DICE units for an operator. The operator has the responsibility of validating the DICE units that a miner excavates for it.
In the process, the miner is the one that owns the DICE. DICE works on a unique methodology that incentivizes both the miner and the operator. It is because the operator does not get the ownership of the DICE units that the miner excavates for it.
DICE employs two external parameters while mining, the global complexity, and the local complexity. The global complexity is a unique number (as on date, it is 40) representing the degree of difficulty of mining one unit of DICE value equal to 1. The global minimum is 10 less than the global complexity.
Hence, the global minimum today is 30. The operator decides the local complexity number that is marginally more than the global minimum. The critical element is the difference between this local complexity and the global minimum. The miner does not get the ownership of the DICE units if their complexity is within this critical difference.
These DICE units are available for scraping. The operator can scrape these DICE units thereby incentivizing the operator. Thus you see that both the miner and operator get incentives in the mining of DICE units.
Donation mining is a new concept in which the miner does the excavation for the operator without getting any incentives. Usually, charitable organizations, NGOs, and the institutions offering loyalty benefits engage in this type of mining.
It is similar to the donations we make for philanthropic purposes. You work for someone else without expecting any gain or incentives in return. In fact, you donate your earnings to them. Donation mining works on a similar concept.
Yes, it is a new concept as far as cryptocurrencies are concerned. However, it is an important one as well because such transactions happen in Fiat currencies. DICE tokens have qualities of fiat currencies. Hence, such operations have started gaining significance in crypto space today.