Non-fungible Tokens Can Redefine Cryptocurrency Mining

Non-fungible Tokens Can Redefine Cryptocurrency Mining


Why Buy NFTs When You Can Mine Them?

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Key Takeaways

  • Earning assets can be more fun than purchasing them outright
  • How multiple organizations use blockchain and crypto to digitally include and empower the world’s financially underrepresented
  • A Southeast Asian startup is adding NFT mining to its blockchain gaming ecosystem

Receiving bitcoin in your digital wallet happens in one of three ways. You can buy it on an exchange. Someone or some organization may send you coins in exchange for a product or service, or even as a reward for making a purchase.

And then there’s mining.

Miners buy custom, expensive, exclusive, high-maintenance, power-gorging equipment to produce blocks on the Bitcoin network. Those that win the race get handsome block rewards.

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If cryptography, coding, and high-level computer wizardry satisfy your soul, and you have the resources, mining is an entertaining financial hobby. For others, mining is a large-scale business operation.

Not all cryptocurrency mining is equal. Given its longevity, security, liquidity, and price, it’s no wonder that bitcoin is the most coveted within the cryptosphere.

But many, many more currencies await those willing to wield digital picks and shovels.

Bitcoin and other Proof-of-Work (PoW) networks pay miners in the chain’s native asset. Mine bitcoin, you’re paid in bitcoin. Mine Monero or Doge, you get Monero or Doge. You get the idea!

By their very nature, mineable cryptoassets are fungible. Aside from tainted coins flagged as suspect — perhaps you bought bitcoin from a centralized exchange unwittingly(?) used as a scam’s clearinghouse — bitcoin and its ilk freely trade at a 1:1 ratio.

Fungible is a fancy but shorter word for ‘interchangeable.’

Fungible assets can be scarce, but there’s never a sense of rarity. Like the boring cash in your wallet, a bitcoin is a bitcoin, no matter how many zeroes you use to divvy it up. We can trade them all day, and there’s little difference between them apart from transaction hashes.

On the other side of the, “ahem,” token, NFTs are unique. Owning an NFT is like owning a snowflake. While millions may exist, no two are exactly alike — which opens the door for NFT mining to put a new spin on an old tradition …


Digital Inclusion

Yes, mining bitcoin can yield profits. But as the founder of Cardano, Charles Hoskinson, explains in this video, the barriers of entry are incredibly high:

Centralization vs. decentralization aside, at the heart of Charles’ argument on PoW vs. Proof-of-Stake (PoS) is digital inclusion. Becoming a bitcoin miner is tough and expensive.

Staking your ADA — or other coins on similar PoS networks — is cheap and easy. And that precise financial aspect is what’s going to draw participants into Cardano’s ecosystem.

The world is increasingly connected, yet so many still can’t link up with the digital economy.

Lowering financial barriers while simultaneously offering financial incentives opens a bridge to the world’s unbanked billions.

But Cardano isn’t the only blockchain project with a focus on uplifting the underserved citizens of emerging markets …


Southeast Asia’s RedFOX Labs

Billed as the region’s first ‘emerging tech venture builder,’ RedFOX Labs caters to the explosive digital economy in SEA. Southeast Asia’s year-over-year growth in mobile spending is astronomical, crossing $100B in 2019.

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Poised to leverage multiple opportunities, RedFOX — a startup that builds startups — is slated to release a series of AI-enabled cashback and rewards ecommmece portals. Localized versions are heading to Vietnam, Myanmar, and the Philippines.

Best of all, with proper structuring, these apps can allow users to earn dependable, consistent income. For example, in Myanmar, the minimum daily income is 4,800 kyat, or U.S. $3.29 for eight hours of work.

Again, everything hinges on the apps’ rewards point economies. But if regional users can earn even $5/week by playing games and watching videos, app interaction becomes a legitimate side hustle.

While SEA’s appetite for digital goods seems insatiable, mobile games are where the real magic happens. And last year, SEA took the lead on the entire world to become the fastest-growing mobile games market.

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As a venture builder, RedFOX doesn’t focus on cashback apps alone. The project’s gaming division, RFOX Games, is now cooking up a new blockchain game and serving it with a big slice of NFT Mining …


Digital Resurrection

Do you remember POGs? Yes, those collectible milk caps and mass-printed cardboard discs.

They converted children into avid schoolyard gamblers during the early and mid-’90s. But that was before largescale banning by world governments put the game into hibernation.

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But here we are, some 30 years later, and the game’s making a return. And this time around, the collectible aspect is super-convenient and immune to bends, rips, and scratches.

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Like its physical predecessor, KOGs are round and feature a front and back. Pieces lie face-down before a player strikes a stack with a Slammer in an attempt to flip them all over.

Read More: How to Play KOGs, the Digital Version of POGs

Not to be confused with KOGs on WAX — blockchain gaming collectibles (and future game) launching August 18, 2020 — KOGs on RFOX is the world’s first 100% on-chain mobile game.

What’s that even mean? Well, it means that a technological breakthrough is on the horizon. A game that calculates all of its game logic on a distributed ledger, in real-time, on mobile devices, currently doesn’t exist.

Click Here to Pre-register for KOGs on WAX and Enter a Drawing to Win 1 of 25 Limited Edition NFTs

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To be clear, two separate versions of KOGs are both upcoming games. The RFOX version runs on top of Komodo Platform’s modular Antara framework and is fully on-chain. The game’s been in development for over 18 months and is currently in the backend testing phase.

The WAX version, as the name implies, will run on the WAX Blockchain but will not be a fully on-chain game. That’s not to say that there aren’t big plans for all KOGs NFTs.

You see, KOGs is an acronym for Keys to Other Games. They’re part of an entire gaming ecosystem with plans to appear in future titles. Here are a few additional use cases for these unique creations:

  • Build a collection — gotta have ’em all?
  • Trade with other gamers — unlike in-game items you buy in traditional video games, NFTs easily transfer from wallet to wallet.
  • Sell them — multiple marketplaces selling WAX-based assets are already in operation.
  • Enter tournaments — player vs. player (rather than player vs. the game’s AI) gameplay is at the heart of KOGs.
  • Pit them against others — this will vary by country, but there will be ‘fun’ and ‘for keeps’ modes.
  • Transfer to other games — these titles don’t exist yet, but they’re certainly in the pipeline.

Of all those attributes, I saved this article’s topic for last. Now that you know more about the games these NFTs are appearing in, let’s peer directly at the mining aspect …


I Want My NFTs

The world’s only 100% blockchain game won’t run without an extensive network of nodes.

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Distributed networks rely on nodes to keep the chain secure. Network nodes are indispensable pieces of hardware and software working in harmony to verify transactions and create new blocks.

The more nodes deployed across a network, the more robust that network’s security and transactional processing speed.

KOGs on WAX NFTs go on sale in a couple of weeks. Anyone with a WAX Cloud Wallet account can purchase them.

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However, unlike its counterpart, the only way to get hold of KOGs on RFOX NFTs is by mining them.

The RedFOX chain is currently mineable. Those with the technical prowess can sync with the blockchain to mine blocks and earn rewards. But today, miners earn rewards in the form of RFOX coins only.

As opposed to traditional cryptocurrency mining, NFT mining rewards node operators with rare non-fungible tokens.

In traditional crypto mining, node operators receive bitcoin or ethereum or RFOX — or whatever their chosen coin — in return for their efforts.

In contrast, KOGs on RFOX miners can earn rare, one-of-a-kind collectibles. Only a finite amount of these NFTs will ever exist. And once they’re all sold or mined, secondary marketplaces become the only places to find them.


Final Thoughts

Firm details on mining requirements are currently unavailable. However, given the game’s use of a super-lightweight payment client — opening tech bridges to industries beyond blockchain — we can expect node specs to be minimal.

It behooves the game’s creators to make NFT mining as simple as possible to attract enough miners to support all the stacking and slamming.

Fun, highly collectible, multi-purpose, tokenized artwork is coming to the blockchain. You can either buy them or mine them — and we can certainly speculate that the difficulty of obtaining the minable versions vastly enhances their rarity and value.

Expect a follow-up article when spec details emerge. But for now, know that NFT mining will soon become a reality!

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BlockchainAuthor
BlockchainAuthor

Writing for the love of technology.


Blockchain, Crypto, & AI
Blockchain, Crypto, & AI

Emerging tech is poised to disrupt modern society for the better -- the blockchain uprising has only begun. I love tech, and sometimes the feeling is mutual.

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