Can Alkimi (ADS) coins be mined?

Alkimi (ADS) coins, built on the Algorand blockchain, are non-mineable and are instead distributed through liquidity mining and yield farming, with a maximum supply controlled by the Algorand Foundation via the ASA framework.

Dec 26, 2024 at 06:20 pm

Key Points:

• Mining is not applicable to Alkimi (ADS) coins.
• Alkimi is a non-mineable token built on the Algorand blockchain.
• Instead of mining, ADS coins are generated through a distribution process known as "liquidity mining" or "yield farming."
• Holders can earn ADS coins by providing liquidity to decentralized exchanges (DEXs) or participating in yield farming pools.
• ADS coins have a maximum supply and their distribution is determined by the Algorand Foundation through the Algorand Standard Asset (ASA) framework.

Non-Mineable Token:

Unlike traditional cryptocurrencies like Bitcoin and Ethereum, which rely on proof-of-work (PoW) or proof-of-stake (PoS) consensus mechanisms, Alkimi (ADS) coins are non-mineable. This is because ADS is built on the Algorand blockchain, which utilizes a unique consensus algorithm called Pure Proof-of-Stake (PPoS).

In PPoS, block validation is determined by randomly selecting a committee of online nodes known as "block proposers." These proposers are responsible for creating new blocks and validating transactions. Mining equipment, such as GPUs or ASICs, is not required to participate in PPoS, which makes ADS coins non-mineable.

Distribution through Liquidity Mining and Yield Farming:

The distribution of ADS coins is achieved through a process called "liquidity mining" or "yield farming." Holders can earn ADS coins by providing liquidity to decentralized exchanges (DEXs) or participating in yield farming pools. These platforms allow users to deposit their ADS coins and earn rewards in the form of additional ADS coins.

Liquidity mining involves providing liquidity to DEXs to facilitate trading between different cryptocurrencies. Yield farming, on the other hand, involves staking ADS coins in pools that are designed to generate rewards. The rewards are typically distributed in the form of ADS coins, but can also be other cryptocurrencies or tokens.

Maximum Supply and ASA Framework:

ADS coins have a maximum supply of 10 billion coins, as determined by the Algorand Foundation. The distribution of ADS coins is managed through the Algorand Standard Asset (ASA) framework, which provides a set of guidelines for issuing and managing new tokens on the Algorand blockchain.

The ASA framework ensures that the maximum supply of ADS coins is maintained, and it also allows for the creation of new ASA tokens that can represent different use cases or applications within the Algorand ecosystem.

FAQs:

• Q: Can I mine Alkimi (ADS) coins with traditional mining equipment?

  • No, ADS coins are non-mineable due to the Algorand blockchain's unique consensus mechanism.

• Q: How can I earn ADS coins?

  • Earn ADS coins by providing liquidity to DEXs or participating in yield farming pools.

• Q: What is the maximum supply of ADS coins?

  • 10 billion ADS coins, as determined by the Algorand Foundation.

• Q: How are ADS coins distributed?

  • Through liquidity mining and yield farming, as well as the Algorand Standard Asset (ASA) framework.