What is Chia? Eco-Friendly Storage-Based Crypto

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Chia has been all the craze lately. They launched their testnet about a month ago, and since then, a few millionaires have been made just by renting out their harddrives. But what exactly is Chia? Well, we had this question as well… in fact we realized there were 0 videos on Youtube actually explaining what it is (and not specifically how to mine it), so we realized it was time to cover it. 

Let’s dig in. 

Proof of Space and Work

Chia is a cryptocurrency using blockchain technology and it uses what is called the “proof of space and work” mechanisms. In short, to “farm” anything using proof of space and work, you need to be able to hold large amounts of data, and then be able to provide that data to prove you held it at any time. For example, there might be 1,000,000 terabytes of data on a network and the protocol might be asking you for around 200 bits at a certain location on your hard drive. If you can provide what it originally gave you – it’ll reward you for allow it to store data in “space” on your hard drive, and for the “work” you did to put it there. 

Winning is like playing bingo – you fill up your Bingo card with the different letters, and then the network chooses randomly which parts get called. If you get called, AND you can prove that you held the information that the network originally gave you… you win – Bingo!


When it comes to Chia, there are 2 main processes. The first is plotting and the second is Farming. Plotting is essentially putting the data on a storage device you own, and Farming is checking that you still have it on that storage device. 

Before we continue, let’s go over 2 key terms:

SSD: Solid State Drive – this is a form of a storage device that can read and write very quickly – it is one of the fastest, affordable ways to read and write data, although there is a limit to these devices until they don’t work anymore. 

HDD: Hard Drive Disk – This is a form of a storage device that can read and write quite slowly, but is reliable, affordable, and has been used for years. You can store a lot more data on a HDD than you can an SSD for the same price. 


Plotting is the process of putting a bunch of data on a hard drive. Essentially, you are doing a ton of math and filling up a bunch of 1 and 0s on a hard drive – You could use an HDD, but it would be very inefficient, and you could technically use a USB thumb drive, but it would be very slow and unreliable. 

Most people use an SSD, as it will create the finalized plots fast. Plotting is very intensive on SSDs though, in fact some people are plotting so much on them that it completely wears out the unit. A good analogy for this is a pickaxe in the game Minecraft. The more you use the pickaxe, the more wear you put on it, and eventually the pickaxe will break and pop away from your inventory. The same goes for a plotting SSD, as time goes on, it will break and essentially it is unusable. If you’re looking to plot, make sure you check the SSD’s TBW – or Total Bytes Written before it is probably going to die. In any case, if you buy an “enterprise-grade” SSD, the TWB will be much higher than any SSD you buy for a gaming or personal desktop. 

Why does it wear it out so quickly? Without getting too technical, let’s say you want to use 100gb of your hard drive to farm Chia on. Well, you would actually need like 256gb of storage on an SSD so that it can do all those calculations and run a certain algorithm quickly to figure out what it needs to put on the hard drive. Once it is done modifying all those 1s and 0s to what they need to be, it moves it from the SSD to the Hard Drive. 


From what I understand, farming is the process of having the network check that you actually did the work to store the 1s and 0s on those drives. For example, in plotting you are putting the data on your harddrive, and farming is making sure you still have it. Using an algorithm, the entire Chia network will pick a random part of the network and check if it is actually there – if it is… it will reward whoever kept it there with some Chia. 

Think about it like this – if you want to farm some asparagus, you have to first buy the land, then you have to buy some equipment to chop down the trees, then have some specialist come in and make sure the soil is in good shape, then you have to buy an expensive tractor to till the asparagus, and some other tractors to plant the seed. This is a lot of work – think of this as plotting. 

After you do all the plotting, you just have to wait and let it rain for the asparagus to grow, in the most general aspect. We live in Missouri so we know there’s more to it, but let’s keep this analogy simple. Farming in terms of chia is just letting that “plot” sit there – you don’t have to do anything to it and it doesn’t require much upkeep. 

The cool thing about farming, is you farm on a Hard Drive – these HDD’s are slow, older pieces of technology that are much more affordable in comparison to newer SSD’s. This means you can plot to a hard drive, and then will participate in the Chia network for the rest of the Hard Drive’s life – which will actually be quite long due to how the Chia network works.

Crazy Profitability

You might be wondering “Why in the world would I burn out my SSDs and fill up my Hard Drives with extra useless space?” Well, right now, in May… Farming chia is crazy profitable. 

With current calculation, an 8tb hard drive, which costs roughly $200 on Amazon right now, can earn roughly .73 Chia a month with a network size of 2.9 EiB. If you sold those Chia at today’s market price, you would earn $809 a month. As the network grows and more people join it, this profit rate will go down… and you also have to include the fact that the price of Chia may rise or plummet. 

If you want to learn to farm Chia with your own personal computer, in fact you could even use a laptop if you wanted to – it is very easy to start. In fact, all you have to do is download the main Chia application, select your plotting location and your farming location, and then start the plotting process. 

Something else I want to share in this video is that Chia isn’t really the first cryptocurrency to utilize storage hardware as their main network. Storj, Filecoin, and Sia are among some large market-cap coins that essentially use the same thing. One interesting key for Filecoin is that instead of storing random data, they actually store useful data on your hard drive- you are essentially renting out hard drive for someone that wants to pay for it. Of course, the data is all encrypted and is split up among a bunch of computers so there’s not a single point of failure, but it has been around for a few years now. However, mining or farming Filecoin isn’t near as profitable because their network is so large. One of Filecoin’s main goal was to create a large decentalized storage system that was more affordable than Amazon’s web servers – and they did! Even though Filecoin is decentralized and not regulated the way Amazon servers are – Amazon is still 100 times more expensive to store your data on. That’s actually very interesting and makes Filecoin a purposeful coin. 

If you’d like to learn more about specifically how the Chia cryptocurrency works, along with current profitability rates, mining pools, and even how to set up a mega Chia rig… I highly suggest Coin Breakthrough, a channel created by my friend named Caleb, who actually just posted a video we collaborated on onto his channel that explains some differences between Chia and Filecoin. You can click the link in the description or the link on this endscreen to go over to Caleb’s friendly and super informative channel. 

As we end this video, I hope that you have learned something. Thanks so much for watching and we hope to see you in the next video!

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