Comparing Hive & BTC: Both Hive's 'Proof Of Brain' & Bitcoin's 'Proof of Work' Reward Puzzle Solving But Hive Wins!

in Proof of Brain2 years ago

Hive's 'Proof of Brain' consensus algorithm for awarding payouts is uniquely fun and inspiring to use if you are the kind of person who likes to solve puzzles, write, create, educate and curate that process too. Interestingly, it shares some qualities with Bitcoin's Proof of Work algorithm too!

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Bitcoin was the first public example of a cryptocurrency and it utilises a 'proof of work' algorithm. In short, this means that the computers that run the Bitcoin network are competing constantly to perform maths calculations in order to 'win' the right to record the next block of data in the public ledger system that Bitcoin relies on. In other words, Bitcoin is powered by puzzle solving computers.

The rewards from Bitcoin 'mining' for the operators of the computers involved can be pretty high, though they recently dropped due to adjustments made as a result of China banning crypto mining. The difficulty of Bitcoin mining is adjusted every two weeks to compensate for changes in the amount of computing power competing to receive future mining rewards.

Proof of Work

  • Requires a consensus of computers to work together to produce the next block in the blockchain to record the latest transactions on the Bitcoin network.
  • Is powered by 'mining' computers that are incentivised to compete to solve maths problems in order to receive mining reward payouts.
  • The more computers that mine BTC, the harder the puzzles become - meaning that the proof of work algorithm manages the resources and throughput which the network requires and can support.

Hive Blockchain

The Hive Blockchain is a 'forked' project from the Steem blockchain and was created because Steem was taken over by Justin Sun, a dubious Billionaire from Wuhan China, just at the start of COVID19. He moved to censor the network and generally centralise and ruin it - so Hive was created to carry on the original intent of freedom and free speech that Steem was originally created to deliver.

Steem was the first example of a social network powered by a blockchain and it utilises a 'proof of brain' algorithm! This unique system involves the constant creation of new tokens (inflation) which are paid out as rewards to users for their content, actions and comments on the social network. The network design is both similar and different to Bitcoin in interesting ways!

Firstly, the ones doing the hard work are the people! We have to use our brains in order to compete to receive payouts - we are essentially mining our own imagination as part of the proof of brain process! The computers that run the blockchain aren't competing as they are in Bitcoin's mining process, instead they receive rewards for running the network on a scale that is based on the number of votes they receive from the community. This is 'proof of stake' and the computers on Hive are known as 'witnesses'.

Since the Hive witnesses are chosen by a voting process from within the community, even the witnesses need to demonstrate proof of brain in order to receive votes and stay in the top positions in the witness ranking table.

The result of this is that Hive is FAR more efficient to run than Bitcoin, since the hard work is done by humans battling it out for community approval, instead of having aircraft hangars full of computers competing for Bitcoin's mining rewards.

We could argue that all of the food and electricity used to house the humans that comprise the hive community is considerable, but for the most part people would be blogging and being creative anyway, with or without hive - so the cost to the planet and to us all is really negligible!

Proof of Brain + Proof of Stake

  • Requires a consensus of computers to work together to produce the next block in the blockchain to record the latest transactions on the Hive network.
  • Is powered by a combination of 'witness' computers and human brains that are incentivised to compete to create new internet content and new ways to serve the hive community in order to receive reward payments.
  • The more people that add content to the network, the harder it is to create novel content - meaning that the proof of brain algorithm stimulates an evolution in thinking and creativity!

The Genius of Hive

The proof of brain algorithm is so cunningly genius that I am always amazed when I look at it again with fresh eyes. Not only does it stimulate constant creativity, empower people to do more with their lives than watch TV and enable free transactions between people at high speed, it also does this using way less energy than the most famous crypto projects.

On top of all of this, the process is one that both empowers individuals and also motivates them to act as a collective - seeming to find an interesting balance between the two ends of that spectrum.

Just as Bitcoin adjusts it's barrier for miners according to the needs of the network, the proof of brain algorithm adjust too - in the sense that the rewards WILL be paid out, regardless of what content is posted.. So if there is a slow week, then simpler content will be rewarded well. If the activity on Hive picks up then getting higher rewards will take more effort from the people involved.

There is a key difference between Hive and Bitcoin here though too. The more that the price of Hive increases, the more rewards there are for content creators and witnesses, so there will likely be more demand for transactions on the network with more posts being created. Bitcoin, however, can go up in price without necessarily automatically generating more transactions and stress on the underlying network. There are many variables involved in this comparison, though, so there isn't necessarily a concrete rule involved - just an interesting topic to consider!


Given that Hive is actually far more similar to Bitcoin than may at first appear to be the case and since Hive is so much more personal and socially oriented, it seems that Hive should really be more recognised than it has been so far. So many people obsess over Bitcoin, which has limited utility simply because it was the first mover, has a high token value and has largescale adoption. Where might we be if we shifted our collective focus onto more practical uses for blockchain such as social networking and the entrepreneurial powers of Hive?

One of the main barriers to this happening is that Hive is being actively censored by silicon valley who see it as competition. At the same time there is a barrier to understanding Hive's details and complexities and it is these that I aim to overcome by creating posts like this one and the user guide to hive that I recently created too :)

If you've found this post useful or interesting please consider reading my witness statement as I am one of the folks engaging my imagination to help run Hive behind the scenes and your vote for me makes a big difference to how much time and resources I have available to help Hive grow and evolve. I have a lot of ideas for Hive but need more votes to realise them :)

Wishing you well,
Ura Soul

Read My User Guide for Hive Here

You Can Vote For Me As A Hive Witness!

Click the big black button below:

ura soul witness vote for hive

View My Witness Application Here

View Some of My Witness Related Posts

Note: Witnesses are the computer servers that run the Hive Blockchain.

Without witnesses there is no Hive blockchain or DApps such as PeakD and 3Speak... You can really help Hive by making your witness votes count!

I am founder of an ethical Digital Marketing Agency called @crucialweb. We help our clients to grow and innovate online and offer discounts for decentralised projects. Get in touch if you'd like to work with us.
I run a Social network for healing, balancing and evolving too. Meet compassionate co-creators of reality, learn, share & make life better!

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Thanks for the comparative analysis, this is a true gem. I now have a much better understanding of diverse blockchains, how they work and how they can be utilized at a fundamental level.

You point out how the change in price can have a more detrimental impact on the Hive chain compared to Bitcoin. I suspect that in the future this will be mollified by interlinking different blockchains so as to cross connect functions and functionality. This is similar to the early evolution of digital systems which is how we have gotten to where we are today.

I really like how you express your aims at the end of this post. It is gratifying to know that there are people out there making such efforts. As I hope you know from some of our exchanges, I have been advocating for the advent of a new approach in communities here on Hive. The efforts of individuals to advance the system are to be applauded however if we can establish a system for creating working teams within communities we gain the power to amplify those efforts exponentially. Of course this would also need a means of coordinating between teams so that projects could be linked and to prevent duplication of effort.

As always thanks for the insight.
Blessed be

Ahoy! You are welcome.
I'm not sure of the effects of price changes on Hive user rewards is really a problem as in theory, the higher the price, the more users come here, the more they buy into the token and so the rewards pool increases. I don't have all the data, but it's actually not something that people really complain about. It's just theoretically more of an issue than with BTC. The real issue with Hive vs. BTC from an investment standpoint is that BTC is deflationary, whereas Hive is inflationary.. So if there were to be no activity on the Hive blockchain for some reason and no-one buying the tokens, then the price would drop down due to the new tokens being minted. Bitcoin would trend more in the opposite direction because it is deflationary.

I'm currently working on a book about ethical wealth and it includes some parts about decentralisation and Decentralised Autonomous Communities/Corporations. It's possible to use blockchains to really empower groups of people, but we aren't quite there yet!

Thanks for your comment. Wishing you well.

Now I'm really intrigued. As a political ethicist I can hardly wait to hear your views on Ethical Wealth.

As for empowering groups I suspect we are closer than you might think. @taskmaster4450 (or you, I can't remember which) just recently posted regarding the development of SIP's for funding research (the broader potential is staggering). In addition I am just starting to try and establish a project with local university students and city government to get involved with the CityCoin blockchain. My idea is to get the students involved in Hive and start working on connecting Hive ecosystem to the social networking of CityCoin. This will vastly improve onboarding for Hive and greatly expand opportunities for newer forms of wealth creation. In addition it will give us a mechanism to introduce sound and objective ethical principles into our social/political/economic system at a fundamental (theoretical) level.

Good luck with the book.
Blessed be.

Excellent, I look forwards to sharing my work when it is done. I currently need a bit of time to complete it in draft form. I have previously written an unfinished book that is over 2000 pages long and is not yet finished - so this time I have a solid plan to keep things short and precise ;)

When I was referring to empowering groups, I was thinking of technology that is designed to facilitate co-operation in a totally transparent and as fair a way as possible. How well this is achieved is mostly down to a combination of algorithm design, iteration and careful assessment of feedback (plus imagination, empathy and creativity). I haven't have the time in the day to research this topic in depth yet - but I know there are lots of people working on it.

I hadn't heard of citycoin, but yes, I can see what you are pointing to there. Being able to sync up local city projects with a reward pool on hive and a feedback system using blogging could be epic!

Thanks for sharing - I'm excited to see where this all goes too!

Great read! The "mining our own imagination" statement really got me... You're right in so many ways, for one I believe the use case for the hive Blockchain makes it far more useful than bitcoin (it serves as an engine that powers dapps, a social media, a currency, payment system and much more), but the number one hurdle I see in its mass adoption is its user friendliness (I just tried explaining the hive ecosystem to a Blockchain novice, and the only thing he picked out of my explanation was that I was a tech genius😄 even I am still trying to fully understand it). But I believe with Masters like you at the helm of affairs, things may become different positively in the nearest future. Meanwhile let me delve into your post on ~users guide to hive~

Ah yes, well there is a learning curve. I think the main problem is a lack of user guidance information within the websites themselves. There should be popup boxes and a training mode so that people be guided through the experience and how to understand the money/reward aspects.
Hive isn't run by a central company, so it is more D.I.Y. than sites like Facebook. This means users need to think for themselves a bit more here. That's often a good thing but we do need to simplify the sites more, I agree.

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