Proof-of-capacity is a consensus mechanism that ensures that a party has dedicated a certain amount of storage space toward a specific goal. Burstcoin, the first blockchain platform to use classic proof-of-capacity, continues to use it as the foundation for its upgraded consensus algorithm-proof-of-capacity plus.

Proof-of-capacity decentralizes verification of transactions and generation of blocks.  In this application, disk capacity is filled with plot files that contain deadlines.  A larger capacity gives a better chance of submitting the best deadline.  Submission of the best deadline earns the right to commit pending transactions to the blockchain and collect the associated block reward.  The block reward includes all associated transaction fees-fees from regular transactions, messaging, and smart contract executions.

Proof-of-capacity has a parallel in proof-of-work in that its deadline calculation is arbitrary and analogous to the proof-of-work calculation.  It serves to decentralize the network by distributing consensus and preventing manipulation of the distributed ledger.  The resource-intensive calculations made under proof-of-work serve the same purpose.  Beyond that parallel, the algorithms are fundamentally different based on what happens after block completion.  Proof-of-work systems discard the calculations and continue to make new calculations.  Proof-of-capacity systems retain the calculations.  This is the reason that proof-of-capacity is environmentally sustainable by comparison.

Because calculations are retained, there is no need to make calculations in real-time.  As a result, the mining process in a proof-of-capacity system uses very little energy, just enough to run a program in the background on any consumer-grade computer.  This program reads through a small subset of the stored plot files and submits the best pre-calculated results to the network.  The more resource-intensive calculating process is only undertaken when a miner desires to increase their plotted capacity.

Proof-of-capacity-plus is the unique consensus algorithm developed for the Burstcoin network.  It was designed to protect the Burstcoin network from consequences that stem from its commitment to open-source software, a type of software released under a license that allows users the right to use, study, change, and distribute it to anyone for any purpose.

It is said that “imitation is the greatest form of flattery.”  Indeed, many years after its founding in 2014, there has been a proliferation of quasi-legal, quasi-ethical copies of the Burstcoin network-not the basic concept or a specific part of its innovative code, but the entire network, including everything from its account structure to the format of its plot files.  While many of these projects are already in a state of collapse due to their lack of utility and development, their existence, and the potential for proliferation, presented a complex problem for Burstcoin’s classic algorithm-how could the network be protected from the capacity of copy-cat projects co-mining on the Burstcoin network with no commitment to the project.

Proof-of-capacity-plus is the classic proof-of-capacity algorithm combined with an element of proof-of-stake.

Proof-of-stake is an environmentally friendly algorithm because it does not involve arbitrary calculations. Still, what it gains in this area it makes up for in others.  Perhaps ironically, proof-of-stake suffers from the “nothing-at-stake” problem.  There is also the advisability of substituting “who is the most wealthy” for “who can expend the most energy” to consider.  While proof-of-work remains unrepentant in its waste of resources, many innovations have been made to proof-of-stake to overcome its shortcomings.  Peercoin, the first cryptocurrency to implement proof-of-stake, has been a chief innovator in this area.  Like Peercoin with proof-of-stake, Burstcoin was the first cryptocurrency to implement proof-of-capacity and has continued in its position as the principal innovator for this algorithm.

Proof-of-capacity-plus adds a stake factor to its calculations so that storage capacity is effectively multiplied based on the amount of stake that a miner sets aside for this purpose.  One of its most interesting features is that there is no predefined level of stake.  It is based on average stake so that more than the average must be committed before a benefit can be realized.   Staking benefits are realized in the form of statistically improved deadlines at the time they are submitted to the network.

Although proof-of-capacity-plus was born out of necessity for Burstcoin, it has the added benefit of enhancing the Burstcoin network’s already impressive environmental sustainability profile.  It also expands the methods available for mining so that more people can participate on terms that better suit their circumstances related to hardware requirements.  With small miners able to effectively multiply their capacity, it appears that the elusive system of consensus-based self-regulating enforced moderation and decentralization has been achieved.

Note:  Burstcoin was founded as an alternative to the waste of energy in proof-of-work systems and the lack of fairness in the initial distribution of proof-of-stake coins.  Although it is necessary to use the terminology of proof-of-stake in Burstcoin’s limited application for the sake of comparison, Burstcoin is not primarily a proof-of-stake platform.  The Burstcoin network employs a limited form of proof-of-stake that might be more aptly described as a proof-of-commitment.