Best SCRYPT Cloud Mining Companies
What is Scrypt algorithm?
The Scrypt algorithm is a modified version of the algorithm created by Colin Percival for an online backup service. The main reason for the original algorithm was to create a computationally intensive algorithm, which requires a large amount of memory to perform. This way the brute force attacks becomes too expensive to execute on large scale.
The Scrypt cryptocurrency mining algorithm is used as a Proof of Work algorithm.
Which coins are using Scrypt?
The Scrypt algorithm has been originally designed in cryptography to prevent large-scale custom hardware attacks by requiring large amount fofmemory. It is used as a proof-of-work scheme by a number of cryptocurrencies by now.
The first altcoin introducing Scrypt as a hashing algorithm was Litecoin in 2011, developed by Charlie Lee, a former Google employee.
Litecoin has been followed by Dogecoin and Gridcoin in 2013. Dogecoin was introduced as a joke currency based on the featuring a Shiba Inu dog from the “Doge” Internet meme. It is however quickly developed its own online community and proved it can be a valuable asset for charity based payments. Gridcoin seeks to distinguish itself from Bitcoin by adopting “environmentally-friendly” approaches to distributing new coins and securing the network. Most notably, Gridcoin implements the novel Proof-of-Research (POR) scheme, which rewards users with Gridcoin for performing useful scientific computations on BOINC (Berkeley Open Infrastructure for Network Computing), a well-known distributed computing platform.
In 2014 additional Scypt algorithm based crytocurrencies appeared on the market. Auroracoin has been created to serve as an alternative to fiat currency in Iceland due to the reaction to the recent financial crisis experienced in the country. BlackCoin was created by the developer Rat4, the expected time for a confirmation is only 64 seconds. Its Proof of Stake system secures the protocol through an efficient, decentralized process called “minting”. And at last, but not least, PotCoin is also using Scrypt algorithm. This coin was developed to service the legalized cannabis industry.
Which hardware can you use for mining with Scrypt algorithm?
In order to perform cryptocurrency mining based on Scrypt algorithm, sufficient amount of memory needs to be built into the mining system. This implementation was a direct response to the dominance of ASIC miners on the Bitcoin network. ASICs were originally designed to perform SHA-256 calculations. Due to the need of memory for a long time, Litecoin was more decentralized than Bitcoin as being ASIC-resistant.
Until the ASIC miners appeared on the market for Litecoin and other similar altcoins, the Scrypt based mining with power CPUs was a profitable option to mine cryptocurrencies. However, as the industry evolved Scrypt based ASIC miners appeared on the market. These Application-Specific Integrated Circuit chips (ASICs), the mining hardware which is created solely to solve the hashing function of this specific algorithms is the most cost-efficient way to run your mining equipment nowadays.
- widely supported and documented
- several coins use Scrypt based algorithms
- profitability issue for home based mining rigs, since ASIC miners took over the market
- less energy efficient