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Table Of Contents
The Mina Protocol (MINA) operates as a smart contract compatible proof-of-stake (PoS) blockchain and cryptocurrency. The protocol is unique in that it limits block capacity to only 22 kilobytes in size. This ingenuitive approach helped the platform earn the title of “the world’s lightest blockchain” by developers.
What Problems Does Mina Protocol (MINA) Solve?
The Mina Protocol (MINA) integrates various cutting-edge cryptocurrency technologies to alleviate multiple problems in the market. Primarily, the platform helps to combat centralization. Mining Centralization has long been an issue for early blockchain. In the future, these issues will affect nearly every network. The very nature of blockchain technology is to blame for this centralization. As blockchains grow, miners need to keep a copy of the valid transaction history.
Early blockchains like Bitcoin already have an extensive history that can take a day just to download during your node setup. Sadly, this situation could eventually lead to scenarios where only a select few miners possess the technical resources to securely store such large amounts of data. The Mina Protocol (MINA) eliminates these concerns by placing an on-chain data restriction on the network.
Another problem that the Mina Protocol (MINA) helps to eliminate is financial barriers. The platform has no minimum stake to become a block producer and no lock-up period. This strategy enables anyone to participate in the network regardless of their wallet balance.
The Use of Oracles
Oracles are off-chain sensors that communicate data to and from the blockchain. These sensors can be set to monitor anything from the weather to stock prices. As such, they enable blockchains to better integrate into traditional markets in a powerful way. However, since they are off-chain and usually centralized, they create a weak point in the network.
Notably, the Mina Protocol doesn’t require the use of centralized data oracle like other cryptocurrency blockchains. Instead, it relies on snapshots of data relevant to the decentralized application from multiple websites. This approach provides a more decentralized alternative to oracles.
Benefits of Mina Protocol (MINA)
There are a lot of benefits gained when you utilize the Mina Protocol. For one, the platform provides developers with a streamlined way to execute Dapp functionality. The Mina Protocol was built from the ground up with the goal to curtail computational requirements in order to run Dapps more efficiently.
How Does Mina Protocol (MINA) Work
The Mina Protocol leverages a set of hybrid Zero-Knowledge proofs, a unique node structure, and technical architecture to accomplish its goals of keeping the blockchain open and accessible to the masses. Zero-Knowledge proofs are a technology that enables a user to prove they have certain information or are a particular person without revealing any of the actual data to the other party.
For example, imagine that you have the location of a secret island, but to get to this paradise you need the assistance of a helicopter pilot. You seek out someone with the skills and you ask for their assistance. You notify them that you will compensate them when you arrive at the location. Now, the problem arises of how to get the pilot to agree to the trip without knowing the exact location.
You could show the pilot the location of the island, but that would be enough information for the pilot to go there without you and claim it for themselves. Instead, you show certain parts of the map to let him know that you have a map that is accurate. After he verifies that you are in the know, the pilot agrees to your terms.
Now apply that same concept to cryptocurrencies. Instead of an island, you have a wallet and instead of a map, you have the blockchain. By verifying enough random data on the network, the other users can ascertain with great accuracy that you are capable of accessing a particular wallet.
Zero-Knowledge Proofs in the Mina Protocol
Zero-Knowledge (zk) proofs were introduced by MIT professor and Algorand founder Silvio Micali. The concept works by providing a snapshot of a timeframe on the blockchain. The Mina Protocol introduces a mechanism called Recursive Zero-Knowledge Proof to the equation. Recursive Zero-Knowledge Proofs streamline data transmission even further. Instead of turning every transaction and block into a 22-kilobyte snapshot, the network makes an overview snapshot of multiple transactions. Since all of these snapshots are now in one 22-kilobyte snapshot, the blockchain remains light.
The technical architecture of the Mina Protocol is somewhat similar in function to Bitcoin. When a user makes a transaction, it goes into a pool of pending transactions. This pool allows block producers to decide on what transactions to include based on how high their transaction fee is.
This structure keeps the blockchain light, but it also has some technical downsides. Mainly, the network has similar performance to Bitcoin in terms of speed with MINA capable of only 22 transactions per second (tps). Notably, it takes 15-confirmations for transaction finality to be achieved on the network.
There are three key participants on the Mina blockchain that work in tandem. Specifically, the network employs verifiers, block producers, and snarkers. Each of these users plays a vital role in keeping the network safe, valid, and light.
Anyone can become a verifier on the Mina Protocol. The primary purpose of these nodes is to hold the 22-kilobyte zero-knowledge proofs. As such, they play a crucial role in keeping the network secure and valid.
The second node operating on the Mina Protocol is called block producers. These users are responsible for storing the current state of the blockchain. They also send snapshots of the blockchain state to verifiers. Block Producers’ main responsibility is to create blocks containing transactions. For their efforts, they earn Mina tokens from transaction fees and block rewards.
Block Producer rewards are based on how much Mina they stake relative to other block producers. Regular MINA holders may also delegate their tokens to block producers to gain access to rewards. Uniquely, there are no minimum staking requirements or lock-up periods to become a block producer. In this way, Mina provides a more democratic strategy to the market.
The goal of Snarkers is to take snapshots of all the transactions. They capture the state of the entire blockchain as a lightweight snapshot and send that around versus the chain itself. In the Mina Protocol, Snarkers earn rewards paid by block producers using a cut of their block rewards. Snarkers are able to provide snapshots of transactions in parallel which improves the network efficiency greatly.
The final piece of the puzzle is Archive Nodes. This node is tasked with storing the entirety of the Mina Protocol’s blockchain history. They are a vital component of the network’s security features because they enable developers to reference archival node data seamlessly. Interestingly, this node data is stored on the Google Cloud.
The Mina Foundation is a non-profit organization tasked with expanding the Mina Protocol’s ecosystem and user base. This organization is based in the Cayman Islands and was incorporated in February 2021.
The Mina Protocol integrates an advanced proof of stake (PoS) mechanism. According to company documentation, this system is a modification of Cardano’s Ouroboros mechanism. The main benefit of this style of consensus is that it enables the network to host unlimited block producers.
MINA is the main utility and governance token for the network. Users can send value globally utilizing this token. You can stake MINA and secure passive rewards on the network. Notably, the token was launched with an initial supply of 1 billion tokens and no maximum supply. The system is designed to allow an annual inflation rate of 12%. Keenly, this will drop to 7% after two years.
History of Protocol Mina (MINA)
The Mina Protocol entered the market in 2017 and was launched from San Francisco, California. O(1) Labs is the development team behind the project. Originally, the network was called the Coda Protocol. The concept is the creation of two lifelong friends and computer scientists, Evan Shapiro and Izaac Meckler.
The Mina Protocol has had an excellent launch. The network was able to secure venture capital from Multicoin Capital, Polychain Capital, and Coinbase Ventures. In September 2020, the company was hit with a lawsuit regarding the similarity of its name to the Coda Blockchain. After the suit, the project was rebranded to the Mina Protocol.
In February 2021, the Mina Foundation and the Ethereum Foundation formed a strategic partnership. The goal of the project is to integrate Mina’s technology into Ethereum. Interestingly, Vitalik Buterin, Ethereum’s founder, is a long-time fan of the use of Zero-Knowledge Proofs (zk). Notably, the Mina mainnet went live this year after three years of Beta testing.
How to Buy Mina Protocol (MINA)
Mina Protocol (MINA) is available on the following exchanges:
Uphold – This is one of the top exchanges for United States & UK residents that offers a wide range of cryptocurrencies. Germany & Netherlands are prohibited.
Binance – Best for Australia, Canada, Singapore, UK and most of the world. USA residents are prohibited from buying Mina Protocol (MINA). Use Discount Code: EE59L0QP for 10% cashback off all trading fees.
WazirX – This exchange is part of the Binance Group, which ensures a high standard of quality. It is the best exchange for residents of India.
Uphold Disclaimer: Assets available on Uphold are subject to region. All investments and trading are risky and may result in the loss of capital. Cryptoassets are largely unregulated and are therefore not subject to protection.
The Mina Protocol (MINA) – A Well Planned Solution for Tomorrows Blockchain Woes
You have to hand it to the developers behind the Mina Protocol. They are thinking farther ahead than most projects in the market. The concept of a super light blockchain that provides a truly decentralized experience for users will always be welcomed in the market. For this reason, the Mina Protocol is positioned excellently.
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