While quai is one of the few projects exploring the potentials of merged mining, the technology has a long and storied history, originating from Satoshi himself.
History and origins of merged mining
The idea of merged mining was first conceived by the anonymous Satoshi Nakamoto in December 2010. In a discussion of a project attempting to create a decentralized DNS system called “BitDNS,” Satoshi described the theoretical possibility that a blockchain could be a “completely separate network and separate block chain, yet share CPU power with Bitcoin.” This would allow the theoretical chain to inherit security and decentralization from Bitcoin without requiring dedicated miners.
Satoshi’s proposal came to fruition through Namecoin, the eventual evolution of BitDNS. Namecoin, which launched in April 2011, utilized merged mining with Bitcoin by creating a combined Bitcoin/Namecoin block header: the same tactic suggested by Satoshi months before.
While Namecoin’s launch was a success, the project was merely a development upon Bitcoin’s existing ecosystem, and thus, its use of merged mining was limited.
In 2014, the creator of Litecoin, Charlie Lee, performed a Reddit AMA to make the case for merged mining between Litecoin and Dogecoin.
What is merged mining?
So merged mining has been around for a while — but what actually is it? At a high level, merged mining is simply the practice of securing multiple blockchains with one miner. This can be done when both blockchains utilize the same hashing algorithm.
In the case of Namecoin, both Namecoin and Bitcoin use the SHA-256 hashing algorithm. Thus, miners are able to scan the hashing algorithm for a hit on either blockchain. Because Bitcoin has a much higher difficulty than Namecoin, miners that are merge mining Bitcoin and Namecoin are much more likely to find a Namecoin hit than a Bitcoin hit.
Merge mining is not limited to the SHA-256 hashing algorithm. Projects like Quai Network are developing merge mining solutions using other algorithms like Blake3. Instead of allowing a more popular chain’s miners to simultaneously merge mine Quai, internal merged mining is used in a hierarchical structure to maintain the same security across all chains within the network.
Why Merged mining?
Merged mining is a cool concept, but what benefits does it actually provide? Merged mining has the potential to provide blockchains with a long list of benefits, but few have yet to be fully realized.
First, blockchains are able to receive additional hashpower (and thus security and decentralization) that they may not otherwise be able to achieve. If a blockchain is launched that requires dedicated miners, they may initially struggle to achieve 100 unique miners across the globe. This blockchain would be extremely weak, vulnerable to a 51% attack at any time. In contrast, if a blockchain launched with the capability to be merge mined with an already-secure chain, they could inherit a fair percent of the parent chain’s liveliness to provide security and decentralization in the early days.
Second, when combined with the concept of modularity, merge mining can provide increased TPS and throughput without necessitating L2 solutions. Quai Network, for example, merge mines three “tiers” of chains: Prime, Region, and Zone. The singular Prime chain is mined by all miners, while miners are able to choose which of the 3 Region chains and the 9 Zone chains they wish to mine. This hierarchical structure allows for 13 unique chains to all have the same security as if all miners on the network were mining each of these chains.
merged mining in quai network
Quai Network believes merge mining technologies have the potential to solve the scalability issues that all blockchains are experiencing today. By combining merge mining with a hierarchical structure of chains, Quai Network is able to achieve over 250x the TPS of Ethereum with the same security, decentralization, and smart contract capabilities.
Conclusion
While blockchain veterans like Satoshi and Charlie Lee touted the concept of merged mining, very few projects have utilized the technology to its full potential. Quai Network is the first project to combine the benefits of merged mining with the scalability of multi-chain solutions.
By bringing merge mining to the masses, Quai Network is hoping to create a blockchain that can scale to meet the demanding needs of world commerce. With a tps of 7,500+ to be expected upon mainnet launch, and the ability to add more Region and Zone chains on demand, Quai Network is setting itself up to become the Layer 1 of the future.
Join us to build a better blockchain.
Quai Network is an open-source Proof-of-Entropy-Minima blockchain network utilizing the capabilities of merged mining to increase throughput and security. Users of Quai Network will enjoy fast transaction times without compromising decentralization and security. Miners will have competitive mining opportunities across the many blockchains within the network.
Capable of thousands of transactions per second, the Quai Network is a new solution to scalability that is soon to be ready for mainnet release.
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