An introduction to Gridcoin
Gridcoin is an open source transaction blockchain that mints and distributes cryptocurrency with relation to the processing power users direct toward data driven analysis and scientific discovery. The Gridcoin blockchain is currently secured through a proof-of-stake protocol and monitors processing contributions to the distributed computing infrastructure, BOINC. BOINC, the Berkeley Open Infrastructure for Network Computing, hosts major citizen science computing projects such as IBM’s World Community Grid, SETI, and the Large Hadron Collider, alongside projects developed by students, enthusiasts, mathematicians, researchers, and citizens.
SETI@Home was launched as a distributed computing project in May 1999 by the Berkeley SETI Research Center. It operates by packing data recorded in the 2.5 MHz wide band of the SERENDIP IV instrument into “work units” to be analyzed by the idle processing power of volunteers. After analyzation, the completed work units are returned to SETI@Home servers in california. This concept was developed further in 2002 and resulted in the BOINC software being released in 2004.
BOINC is an open source distributed computing infrastructure which provides anyone with the means to process data via a global volunteer based distributed computing network. BOINC has been used to identify pulsars, create patient specific cancer treatments, expand on our knowledge of efficient molecular combinations for solar panels, and complete countless other scientific and mathematical computational tasks. While BOINC has been used primarily for science and math, it can host data from any field so long as the data can be formatted for BOINC’s processes. Examples of projects include tasks on engineering, rendering, weather and climate prediction, and social, market, and resource analytics.
The Financial Crash of 2008 and Bitcoin
As a result of the 2008 financial crash, many groups and individuals pushed for alternative financial systems which would help prevent similar disasters in the future. A pseudonymous individual or group known as Satoshi Nakamoto was one of them. They seem to have worked under the assumption that a principal problem of the contemporary financial system can be traced back to the system’s reliance on centralized middlemen entities. Following these assumptions led to their creation of blockchain technology with the bitcoin cryptocurrency as its incentive mechanism. Blockchain technology uses cryptography to ensure a public and unforgeable digital cash system that does not need to rely on any middleman entities. The cryptographic method used to secure the public ledger requires individuals to use processing power to solve complex hashes. This process, known as proof-of-work, works, but accomplishes nothing beyond securing the bitcoin network, thereby moving the ledger forward. Over time, alternative processes for securing the public ledger were and continue to be developed. Nakamoto released their blockchain technology through an open source medium. This allowed thousands of individuals and entities to examine, learn from, and improve upon the code and protocols of the technology.
One such entity was the pseudonymously named Rob Halförd. They took the concept of the blockchain and altered its incentive structure to create an entirely novel protocol which marries the second blockchain protocol developed, proof-of-stake, with a cryptocurrency generation mechanism based on processing contributions to BOINC.
The Gridcoin blockchain was genesised on October 16th 2013. It started with a proof-of-work protocol based off of Bitcoin. On October 11th, 2014, Gridcoin was forked onto a proof-of-stake protocol which secures the blockchain based on the number of active GRC on the Gridcoin network. Gridcoin has evolved through several iterations of proof-of-stake and incentive structures. Currently, it uses proof-of-stake to secure the blockchain while using processing power contributed to approved BOINC projects to mint the cryptocurrency, GRC. To accomplish this, Gridcoin developed a tool defined as a superblock which collects and records each Gridcoin participant’s contributions to BOINC. This data is then translated into the Gridcoin variable known as magnitude, which then determines how much of the planned GRC minted each user receives.
Gridcoin mints about 27,000 GRC through research a day. This GRC is split evenly among approved BOINC projects. The Gridcoin Network then distributes each project’s allotted GRC among its participants relative to each participants contribution to that project.
Currently, additional minting occurs through an interest structure that awards 1.5% annual interest to each GRC in circulation.
Currently, a Gridcoin block contains information pertaining to transaction data between users participating in the Gridcoin blockchain. In addition to these standard blocks, Gridcoin compiles records of individual performances on projects and events provided by third-party data sources into a superblock. Superblocks maintain all of the qualities of standard blocks including immutability based on consensus. Currently, superblocks contain information related to credits awarded by projects utilizing the BOINC computing management platform, representing the completion of analysis of sets of data provided by the project. Each superblock thus contains unique user information regarding the processing power that a user contributes to BOINC projects. Superblocks have the theoretical potential to collect statistics from a vast array of sources so long as those sources are capable of ranking individual contributions or performances and can provide that information in a suitable format.
Rain is a unique feature of the Gridcoin Research wallet. It permits anyone to distribute a set number of their GRC to the participants of a particular BOINC project. This has the potential to draw more participants and their computing power to that project. We intend to explore the way Gridcoin utilizes this feature in a future post.
Gridcoin utilizes a voting system built directly into the Gridcoin Research wallet. Any community member or developer with a significant stake in Gridcoin (currently 100,000 GRC) can create a poll. A poll can be made to weight a vote based on a user’s stake, contributions to BOINC, or both. Additionally, a poll can be made to weight votes through a one-wallet-one-vote or one-CPID-one-vote mechanism.*
*A CPID, Cross Project ID, is a tool that is assigned by BOINC. Gridcoin uses it to distribute GRC to the appropriate user. This will be explored further in another post.
We hope you enjoyed this brief summary of the Gridcoin Network. There is, of course, much more to Gridcoin. Join us in the future as we explore different aspects of the Gridcoin network and community in detail. If you would like to see anything specific explored further, feel free to leave us a comment and we’ll see what we can do!