Blockchain startup “Chia Network” raised $61 million in a round of financing. It includes investments from top venture capital firms Andreessen Horowitz and Richmond Global Ventures.
The value of the decentralized innovative contract platform in this round of financing is approximately US$500 million. This financing round also received support from AngelList Naval Ravikant, CEO and co-founder of Breyer Capital and True Ventures.
Gene Hoffman, Chia’s president and chief financial officer, hopes to go public through an initial public offering (IPO) this year.
Chia Network was founded in 2017 by Bram Cohen, the creator of BitTorrent. It has raised more than $3.3 million in a seed round led by Ravikant and Andreessen Horowitz in 2018. The company describes its Chia token (XCH) as a “digital world.”
The principal value proposition of Chia Network is its unique consensus mechanism, “Proof of Time and Space.”
The consensus method aims to provide higher energy efficiency than proof-of-work mining. This method attempts to identify unused computing power on the verifier’s hard drive.
How to create or “plant” XCH
Users need to install Chia’s software, which writes password data called “pictures” to their hard drives. The problem of blockchain broadcasts approximately every 18 seconds for each new block. The probability of an individual winning the block depends on the availability of unused computing resources provided by farmers.
The company claims that XCH is a green alternative to Bitcoin and other cryptocurrencies. However, some people still question the network’s environmental claims.
Chia’s drawing process usually uses the computer’s solid-state drive or SSD. Though, the SSD can be burned in less than six weeks. In contrast, the service life of frequently used SSDs usually exceeds ten years.
The company predicts that Chia will promote the growth of computing waste landfills, which seems to have been substantial. Fortune reported that due to the launch of XCH, there is a shortage of hard drives throughout Southeast Asia.