$ 9.54
27 days ago
(1.49%)
Counterparty is not a traditional cryptocurrency and is more of a payment network - using bitcoin as the transport layer.
Counterparty is a free and open platform that puts powerful financial tools in the hands of everyone with an Internet connection. By harnessing the power of the Bitcoin network, Counterparty creates a robust and secure marketplace directly on the Bitcoin blockchain, extending Bitcoin’s functionality from a peer-to-peer payment network into a full fledged peer-to-peer financial platform.
In addition to sending money without third-party intermediation, you can trade, do business, and engage in advanced financial contracts without having to trust anyone else to hold your funds or do your accounting. Along with the Counterparty protocol, the platform consists of the native XCP token to perform advanced operations, and the secure, browser-based Counterwallet to provide the functionality.
What is Proof of Burn (PoB)?
Proof of burn (POB) is an alternative consensus algorithm that tries to address the high energy consumption issue of a POW system.
POB is often called a POW system without energy waste. It operates on the principle of allowing miners to “burn” virtual currency tokens. They are then granted the right to write blocks in proportion to the coins burnt.
Balances in Counterparty’s native currency, ‘XCP’, will be initialised by ‘burning’ bitcoins in miners’ fees during a particular period of time using a burn message type. The number of XCP earned per bitcoin is calculated thus:
XCP_EARNED = BTC_BURNED * (1000 * (1 + .5 * ((END_BLOCK - CURRENT_BLOCK) / (END_BLOCK - START_BLOCK)) ))
END_BLOCK is the block after which the burn period is over (block #283810) and START_BLOCK is the block with which the burn period begins (block #278310). The earlier the burn, the better the price, which may be between 1000 and 1500 XCP/BTC.
Burn messages have precisely the string ‘ProofOfBurn’ stored in the OP_RETURN output.
Try our free CounterParty (XCP) portfolio tracker if you want to efficiently keep track of your XCP and other coin/token investments.