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Intermediate
Mar 17, 2022

Proof of Capacity (PoC)

Proof of capacity (PoC) is an energy-efficient consensus mechanism that allows nodes on a blockchain to use the empty space on their hard drives to mine crypto.

Proof of capacity (PoC) is a consensus mechanism that allows miners to mine crypto using the empty space on their drives.

It works by storing a list of possible solutions on a miner's drive before mining even starts. The more drive space a miner has, the more chances to match the required hash value from the list. That increases the miner’s chances of winning the mining reward.

What makes PoC different from other consensus mechanisms? A key feature of PoC is that it requires very little energy to run, compared to other consensus algorithms such as proof of work (PoW).

PoC also relies on a user's storage capacity to verify blocks, which makes it more environmentally friendly. Proof of capacity is also known as “proof of space.”

How Proof of Capacity (PoC) Works

Before mining even starts, full nodes or miners need to allocate some storage space to store the list of possible solutions. This process is known as "plotting."

During the plotting phase, the hashing algorithm runs against each nonce stored in the blockchain header. The output of this hashing is stored in a new file, called a plot file.

The plot file is a list of hashes that correspond to the header values. After the plotting process is complete, miners can start mining by verifying blocks and adding them to the chain.

Proof of Capacity (PoC) Examples

At the moment, Proof of capacity is used in:

  • Permacoin, which uses Bitcoin's PoW with a simple, more useful task: Providing a strong, distributed storage to its miners.

  • SpaceMint, which uses a consensus mechanism based on the non-interactive version of PoC, in which participants generate and commit to a hard-to-pebble graph.

  • Burstcoin, a mining system which uses free space on your drive instead of draining your GPU and CPU power. Any user can mine with the same chances, since hard disks are affordable and easy to find.

Proof of Capacity (PoC) Limitations

Some of the biggest drawbacks of PoC are as follows:

  • It can be difficult to generate a large list of hashes for the header values.

  • If a node drops out of the network, it can take some time to rebuild the plot files.

  • The more miners that are added to the network, the more storage space that’s required.

If you want to know more about proof of work, click here.