Principally, digital currencies have been perceived by the wider world as the domain of the technically minded; reserved only for those with an in depth understanding of ledgers, cryptography and with access to the vast amount of computer power supposedly needed for the mining process.
Technical jargon aside, digital currency can actually offer something incredibly valuable to the masses and to the global economy. At LEOcoin we have always maintained that the real power of this monetary innovation lies in its ability to level the playing field and democratise finance.
That is why we have taken the exciting step to change how everyone can mine LEOcoin, by shifting to a 100% Proof of Stake system. Continuing our ambitions to be the digital currency for the mass market, we are hoping that this change will lower the barrier entry to make LEOcoin accessible for everyone.
Methods of mining digital currencies have traditionally necessitated that individuals use a Proof of Work system. In essence you 'lend' the processing power of your computer to the network to solve algorithms that generate digital currency. It's a process that requires expensive and powerful computers with a huge amount of power. To date, this of course means that individuals have needed to have a certain level of technical know-how to be able to invest in digital currencies. These investors must take an active part in processing the blockchain ledger and lend their computer power, to be able to earn any currency in return.
Many currencies like Bitcoin still rely on this system, and individuals across the world have set up large mining farms; filling them with hundreds of powerful computers.
There a clearly a number of flaws with Proof of Work however, aside from the obvious bias towards individuals who have the finance to buy big machines and knock smaller players out of the market. The method is also hugely energy intensive. The carbon footprint of running the current 'mining rig' computers roughly equates to the carbon footprint of a country the size of Cyprus.
But mining digital currencies needn't be this environmentally damaging or indeed so reliant on a high level of IT expertise. With Proof of Stake there is less work involved for an individual who is interested in investing in these types of currencies and less strain on the world's resources. The process is accessible to anyone who owns and can manage a computer; your earnings are simply based upon the number of coins, or "stake," that you hold rather than you having to provide any computer power.
At LEOcoin we have always said that this process should be as straightforward as clicking a button in your e-wallet to stake your coins onto the blockchain. Our move to Proof of Stake will allow consumers to mine LEOcoins from their home computers with ease. Simply put, the more people invest, the more they are likely to earn.
Digital currency has the potential to fundamentally revolutionise the way that business is done, but it can only do this by appealing to a mass market. By opening up this process to people we now have a much greater opportunity to spread and build our economy.