Gridcoin (Ticker: GRC) is a decentralized, open source math-based digital asset (cryptocurrency). It performs transactions peer-to-peer cryptographically without the need for a central issuing authority.
Gridcoin was the first block chain protocol that delivered a working algorithm that equally rewards and cryptographically proves solving BOINC (Berkeley Open Infrastructure for Network Computing) hosted work, which can be virtually any kind of distributed computing process (GPU/CPU/Sensor/Etc).
BOINC is an open-source volunteer oriented computing grid that combines the processing power of all individual users for the purposes of scientific research. It's free, and harnesses the unused clock cycles from processors and graphics cards to attempt to cure cancer/aids/ebola/malaria, map the milkyway, crack enigma codes, etc..
Gridcoin rewards BOINC computation using the Distributed Proof of Research (DPOR) reward mechanism, which is a combination of Proof of BOINC (POB) and Proof of Stake (POSv2).
Proof of Work (POW) consensus mechanisms are not utilised by the Gridcoin network, making the Gridcoin cryptocurrency network far more energy efficient than any existing POW cryptocurrencies.
To prove his contribution of BOINC work a Researcher installs the BOINC software on his PC. He chooses a Project from the Current BOINC Whitelist. Only projects from the Current BOINC Whitelist will yield a reward. The whitelist is update regularly. The Researcher registers at the project with his email and is granted a CPID (cross project identifier), which keeps track of his unique credits. If the system is now conscious of the email, it automatically knows its pairing CPID. At the moment this is done through Netsoft-online, which will not remain a permanent solution. Netsoft also acts as a credit checking farm, next to BOINC stats, ensuring that the credits claimed by the owner of a CPID, have the same value as what is stored in the project and later the block chain. The Researcher then starts downloading his work from the server. When he is finished with computing this work container, he sends it back to the server together with a recommendation of credits to be granted for this workload. The server compares this recommendation with another one and then grants the lower credit to both Researchers.
To standardize this unit the Researcher calculates his Recent Average Credit (RAC). RAC consists of a daily acquired credits average.
RAC(new) = RAC(old) * d(t) + (1-d(t)) * Credit(new) , while d(t) = (1/2) ^ ( d / 604800 ) ; t being time in seconds since the last calculation in the decay function
This means that Credits older than a week are only weighted half as much. When t=0 (during the first acquistion of credits) RAC=Credits . It is difficult to calculate an accurate prognosis for RAC, since Credits tend to be payed out sporadic.
With this RAC a recent savings account (RSA) is created. It keeps track of a potential overflow of magnitude. The magnitude for a single project is calculated with:
RAC / Network RAC * 100 * Time since last payment in days * Magnitude Multiplier
NRAC is the Average of RAC included in the blocks that have so far been mined with RAC from a single project. If no block has been found so far for this Project, a reward of 30 will be granted for every block. If the calculated reward is is greater than the current maximum block subsidy, the overflow is stored in the RSA. The payout is delivered as soon as a Proof-of-Stake Block has been found by a researcher. The factor 100 ensures that the Researcher's RAC is greater than 100 before he receives any additional subsidy on top of his Proof of Stake interest for every found block. Gridcoin uses a lookback period of 6 months, to check if the credit has been gathered later than 6 months ago. Credit older than 6 months is therefore disregarded. A single Researcher can accrue rewards in a Research Savings Account across multiple devices for up to 6 months. The payments are subject to caps in the Maximum Block Subsidy. The Maximum Block Subsidy is the maximum reward that can be accrued per block from the Research Savings Account, and also serves as the daily limit of how much credit can be added to the Research Savings Account.
How Gridcoin is Created
Gridcoin is created daily from two activities, Proof-of-Stake and Proof-of-Research. Proof of Research is produced at a targeted rate of about 50,000 coins per 1000 blocks. A factor is used to adjust rewards to achieve this target and is called a Magnitude Unit and is stored in the blockchain. If the number of coins generated is too low the Magnitude Unit increases, this increases the number of coins paid for a certain magnitude, if the number of coins generated is too high the Magnitude Unit decreases, this decreases the number of coins paid for a certain magnitude. This has the effect of balancing Proof-of-Research payments with Proof-of-Stake payments. Effectively, if fewer researchers are helping to secure the network, the incentive is increased. The second activity is Proof-of-Stake, and it is produced at an target rate of 1.5% per year, as the coin base increases the number of coins created increases but always at a rate of 1.5% per year. Proof-of-Stake is in every block, when a Proof-of-Research block is staked the Proof-of-Stake reward is also included.
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