What Does Overstock See in the Digital Bank of Westeros, Ravencoin?
The little-known Blockchain project, Ravencoin, has been thrust into the limelight with Overstock.com CEO Patrick Byrne mentioning that his company had invested “millions of dollars” into the “use case specific Blockchain focusing on the transfer of assets.”
Ravencoin’s opening line on a blogpost from Nov. 1 opens with a line referencing the popular HBO series Game of Thrones: “In the fictional world of Westeros, ravens are used as messengers who carry statements of truth. Ravencoin is a use case specific Blockchain designed to carry statements of truth about who owns what assets.”
But other than linking itself to the TV show, what else does Ravencoin offer that has sparked Byrne’s interest? Its four-page white paper is succinct, to say the least, but primarily focuses on its mining algorithm:“X16R - ASIC Resistant by Design.”
New algorithm has promise
Byrne has offered some pretty high praise of Ravencoin in his interview, comparing it to Bitcoin, but “a thousand times more energy efficient.” He goes on to outline the problem with mining price increase and the centralization around ASIC production and cheap electricity. Byrne also mentions the whitepapers tagline, saying it solves problems by being “ASIC resistant” and “redemocratizing mining,” going on to describe the current concentration of industrial-level mining in China.
If Ravencoin has found a new mining algorithm that reportedly thousands are already mining, and managing to keep the difficulty down in order to make it available to all, is this something worth looking into?
The hashing algorithm employed by Ravencoin is intended to totally negate the use of ASIC hardware and redirect the mining power back into the hands of GPUs and computers everywhere. In their whitepaper, Ravencoin lay out the history of the current algorithm claiming that the X16R is the latest step.
The whitepaper notes: “The history of hashing for cryptocurrencies began with SHA256 for Bitcoin, then Scrypt for Litecoin, Ethash for Ethereum, X11 for Dash, followed by X13, X15, and X17. X16R is the next step in this evolution to find a better mining algorithm.”
They go on to explain how even coins like Dash with its X11 hash, which uses eleven chained hashing algorithms in an effort to thwart the move to ASIC mining, has still not been wholly successful as several manufacturers now produce ASIC miners for X11.
“The X16R algorithm intends to solve this problem by constantly disrupting the ordering
of the hashing algorithms” the white paper explains. “The hashing algorithms are the same proven algorithms used in X15 + SHA512, but the ordering is changed based on the hash of the previous block.”
“This reordering does not make an ASIC impossible to build, but it does require that the ASIC adapts to additional input, which is more easily accomplished by a CPU or GPU.”
Clearly Ravencoin’s primary focus is de-monopolizing mining, but what is the company and the coin all about, do they have a solid platform that is worth mining and investing money into?
The transfer of assets
In a nutshell, Ravencoin’s primary task is to “implement a Blockchain which is optimized specifically for the use case of transferring assets such as tokens from one holder to another.” This sounds a bit like Bitcoin, and Bitcoin comes up more than once in its publications. More than that, Ravencoin credits: “the hard work and continuous effort of over 400 Bitcoin developers who made over 14,000 commits over the life to date of the Bitcoin project.”
This does not necessarily mean that they employ 400 developers, rather that the legacy of their coin is that of Bitcoin because Ravencoin is a fork of the original coin:
“Ravencoin is built on a fork of the Bitcoin code. Key changes include a faster block reward time and a change in the number, but not the weighted distribution schedule of coins.”
Ravencoin goes on to list other characteristics of their product, such as being free and open source, that it will be issued and mined transparently with no pre-mine, and developer allocation. They also state it is not intended to be cash.
As reported by Cointelegraph on Feb. 24, when a reddit post asking people’s thoughts on the coin was only four days old, there was not much feedback. Only one person had responded the day it was posted, saying: “Never heard of it until now.” However, interest has indeed picked up, perhaps fueled by Byrne, as more and more user delve into the potential, if any, of Ravencoin.
Reddit user Reigningchamp4eva said: “raven coin seems to be a copy paste of Bitcoin with another of the "chain a bunch of old algorithms together and call it innovative" flare and 1 minute block times...and that's about it. No privacy features, no contracts, no PoS, no free transactions...Let me know when this coin actually brings ANYTHING new the table [sic] and I'm down.”
TomatoKing77 also focused in on Overstock’s investing strategy: “What does the CEO of Overstock know that we don't, dropping a couple mil [sic]? Especially since there is no marketing going on at all. Admittedly an ideological experiment meant to improve BTC and ETH functions, and nicely open source. A project that a large amount of BTC developers are working on because they like it speaks volumes to me.”
Others are taking a more pragmatic approach as SlappyMcFartsack says: “I've already figured out how to mine it, and am doing so now. Let's see where it takes us.”
His sentiments are echoed by Whacktool: ”Pretty much what I am doing. Mine it and see where it goes. The most I am out is a larger power bill.”
A lot present, a lot missing
Ravencoin, with its new algorithm seems to have a hash that could well be resistant to ASIC mining, but of course it remains to be seen if ASIC manufacturers will take on the challenge. However, at it stands, people are seemingly mining it and keeping the difficulty down.
However if this is all they company is really offering, and with a four page whitepaper talking only of X16R, then they are lacking a lot to be taken seriously. For example, there is no roadmap to be found, and the exact team behind Ravencoin is hard to tie down as their blog post references over 400 developers, but talking about their work on the original chain which Ravencoin has forked off of.