‘Although it is taking a long time, it is on its way. It never turns back and never stops. It is always moving forward.’ -A Tale of Two Cities by Charles Dickens
Before May 2017, less than 1% of people from all over the world knew about blockchain or cryptocurrency. CZ, who just left OKEx, was discussing the development and opportunities of the industry in a café with his friend Guo Hongcai depressingly. At that time, he wants to create his own business. But he had no idea about what he wants to start nor his team.
Not far away from him, Justin Sun just screwed up his last Dot-com company entrepreneurial project ‘Peiwo app’ with his title ‘ Jack Ma’s first trainee who was born after the 90s’. Despairing and Frustrated, he speculated on a relative niche market at the time — Cryptocurrency. Unexpectedly, he made his first pot of gold in the blockchain market. Realized the benefits in this market, Justin decided to make something big, to build a public chain with strong marketing features: TRON. On the other side of the ocean, Dominic Williams, who went to Silicon Valley from the UK, was running around for his blockchain project, but raised only $1 million, which can barely allow him to do anything in Silicon Valley. Nevertheless, he tried to use the only financing to develop in the industry. Like these people, there was a young man named Alex. At that time, he was busy with the development of the send version of his POC product. Meanwhile, the operating cost of the product was troubling him. In order to continue the research and development, he has to cut down staff and reduce costs by moving the company from the office to a very small residential building.
Time move forward to September when the traditional internet industry had just cooled off from the concept of sharing economy. Many large-scale sharing economy entrepreneurial projects were not able to be sustained. Venture capitals have decisively chosen to abandon this new economic concept that they once touted. Meanwhile, Bitcoin has attracted some people from gray industries who need to do private transactions and some spectaculars, thus driving prices up all the way. The continuous rise in prices has attracted venture capitals and some small traditional Internet entrepreneurs. With the entry of venture capitals and the emerge of ICO, the price of cryptocurrencies began to rise sharply. The market was becoming more and more active. Until the turning point in 4th Sep, the Central Bank of China halted all ICO projects. The three major blockchain companies OKex, HuoBi, and ZB had to shut down their services in China. CZ, who was overseas at that moment, seized this opportunity to lead Binance to become the world’s largest cryptocurrency exchange. CZ is not the only one who seized this opportunity. Justin Sun, through live broadcast marketing with Binance, has raised hundreds of millions of dollars for his project TRON which raised the valuation of TRON to the top 15 in the world. Meanwhile, Williams just updated the white paper, his project Dfinity, will complete the largest financial in the history of blockchain in the next few months.
Alex raised funds as well. After carefully comparing and studying the various verification methods of the consensus algorithm, he had his own judgment: both the POW and POS are not working, only POC can trigger the most primitive spirit of BTC: Decentralization/spread the power. The advantages of POS are also very obvious compare with the POW and POS: It greatly reduces the waste of resources, employs the user cost more efficiently, and perfects the consensus user joining mechanism. （Park S, Pietrzak K, Alwen J, et al. Spacecoin: A cryptocurrency based on proofs of space[R]. IACR Cryptology ePrint Archive 2015）Alex’s judgment on the industry has been affirmed by leading institutions in the industry. By making equity investment, Wanxiang blockchain labs supported Alex to create a near-monopoly project in the POC field in the future: HPool.
The role of the mining pool is to allow miners to concentrate their computing power and share the computing power income. So they can obtain a more stable income per unit of time. This has great significance to build consensus in a decentralized network. Large miners can calculate a stable return, small miners will not worry about not being able to obtain income on time in the competition with large miners, thus forming a virtuous circle. In other words, the role of the Mining pool is to disperse scattered computing power, integrate it so that small computing power can get smooth income. Instead of waiting too long for the block generation. It can be considered as a task distribution and revenue smoothing system for block generation. User orientation has always been the principle of HPool since it was founded. In addition to the basic mining pool services it provides to users, it also has a user service system which includes online status monitoring, offline push notifications, joint pledge mining, etc. These can lower the barriers for ordinary users to participate. The complete user service made HPool popular in the market since it was established. For a long time, HPool has been in the top few POC mining pools, but the entire industry was focusing more on POW and POS algorithms at that time. There were not many projects involved in the underlying algorithm of POC.
But for POC, 2017 is still a year of great historical significance. The legendary programmer Bram Cohen had retired from BitTorrent’s great success, planning his next big move: Decentralized hard disk mining blockchain project: Chia. His vision is to create a better BTC to solve the problems of energy waste and centralization. And 3 years later, his Chia will have a close intersection with Alex’s HPool.
From 2018 to 2020, HPool has been in a tepid state. One thing should be mentioned in this period is the investment from Fenbushi capital. This investment from the well-known capital in the industry has further consolidated HPool’s leading position in the POC sector. Even though the market doesn’t have much enthusiasm for POC at this time, Alex’s enthusiasm remains the same. This comes from his belief in POC consensus algorithms and the technical logic behind them.
The characteristics of POC make the cost of consensus lower, more environmentally friendly, and more secure. The consensus algorithm, as the bottom layer of the blockchain, is more fundamental than the public chain itself. These features will make the next ecological development extremely rich. The consensus algorithm is not a specific project, but the language that everyone chooses when they develop a program. The consensus algorithm is the most fundamental underlying component.
The time comes to 2021, this year will be another legendary year in the history of blockchain. With the aggravation of the global pandemic, the downturn of the real economy brings the social economy from real to fictitious. The accumulated quantitative ease of dollar exceeded 23 trillions, the US stock market once became the focus. Together with the US stock market, the cryptocurrency market has become the focus as well. In April, the price of Bitcoin reached $63,000. The market cap surpassed Amazon, Tesla, and Facebook, only after Apple and Google among those giants of enterprise. The value of Chia, a project that Bram Cohen has run for three years, has increased as well. Through the investment and support of CoinBase. The world’s only listed digital asset exchange, Chia quickly started a whirlwind among miners. From mining pools to individual miners, they all actively participated in this hard disk mining experiment. The reason behind this is very simple as well. In the beginning, Chia’s cost could be covered by its return in one week. This star project of POC has naturally drawn attention of Alex. He began to promote Chia in HPool’s mining pool. Due to the years of accumulated technical experience and the leading position in this industry, HPool has been chosen by most miners naturally as the link of their mining pool.
However, just like all destined great undertakings will not go smoothly, at this point of the user growth stage. Alex met a crisis that almost destroyed them.
The first problem was the loss of computing power. Users have reported in some forums that HPool was secretly deducting computing power, resulting in a decline in their earnings. At that time, HPool was the only mining pool with large computing power on the market. This problem was repeatedly spread among miners and over-exaggerated. A typical case was the computing power displayed by Chiaexplorer does not match the computing power data provided by HPool, which makes the brand of HPool suddenly became negative. There were even some irrational miners conducted personal safety threats to Alex and the employees of HPool.
When Alex and the team discovered this problem, they studied Chiaexplorer’s technical vulnerabilities and data broadcast therefore identified the problem: Chia’s daily block-generation number is not fixed at all, but Chiaexplorer has always used a fixed number of block-generation, which leads to a huge difference of computing power calculation. During this period, the HPool team began to work extremely hard to dispel rumors. They use simple words explaining to every miner and user the technical principles and computing power issues in major forums, media, and websites. As Alex and his team were struggling to deal with the misunderstanding issue of computing power. Another mining pool company UUPool also started mining Chia. When everyone found the same problem in UUPool, then the third mining pool, no one attack HPool anymore. HPool finally went through this crisis. However, another bigger crisis approached quietly. The popularity of Chia made the mining rigs difficult to buy. Some suppliers began to sell the mining rigs under the name of HPool, hoping to get more profits from it. Later, when the price of Chia dropped, they then pretended to be the official to publish radical articles, trying to lead their conflict of interest with the users to the official. This caused many miners who bought mining rigs to go to HPool, asking for an explanation and solutions. HPool has to explain to customers one by one. The whole incident finally drew the attention of Bram, founder of Chia. At the beginning of this incident, based on the principle of the community first, he chose to stand with the miners to criticize HPool, ask users do not use HPool because of the problem of stealing computing power.
This must be the darkest moment of Alex and HPool. From the Chia official to the mining rig business, and then to the miners, everyone was against their key ecological structure: mining pool. Facing the crisis, Alex did not choose to escape. Instead, he shared the latest technical knowledge with the miners, meanwhile dealt with the remaining problems of the mining rigs business. At the same time, he actively contacted Chia officials and provided all necessary materials, showing the fairness of HPool by the transparency. With Alex’s continuing efforts and the improvement of Chia’s mining ecology, the crisis was finally resolved. Miners found that HPool can get the highest profit compared to new mining pools, so most of the miners finally chose HPool. HPool withstood the test of the market. On the other side. The Chia official has also recognized the efforts made by HPool as an essential part of the ecological node and gave it affirmation. Moreover, as the price of Chia returns to rationality, speculation in this field does not exist anymore. Since then, HPool has been firmly occupying the first position in the global ranking of POC and Chia mining pools.
Surely this does not mean that HPool can relax and develop as a monopolist in this field. It is foreseeable that in the near future, more mining pools will participate in the competition and share HPool’s market. But Alex doesn’t seem to be worried about this possibility. For him, what he wants to see is that, firstly, their various misunderstandings can be clarified. Secondly, POC mining pools can bloom. Each mining pool has its own characteristics, there is no product that could satisfy everybody. Sufficient service providers of mining pools can bring positive competition to the industry therefore meet the different needs of various users better.
As Charles Dickens said: ‘Although it is taking a long time, it is on its way. It never turns back and never stops. It is always moving forward.’
