Primecoin

Primecoin (XPM) is a blockchain-based cryptocurrency which uses proof of work technology to generate new blocks and manage transactions. Primecoin introduced the concept of using blockchain mining to perform useful mathematical functions.

All cryptocurrencies require complex mathematical problems to be solved by computers in order for existing blocks of data to be decrypted and for new encrypted blocks to be generated. This process is computing-intensive and therefore consumes a great deal of energy. But this mathematical problem solving does not serve any useful purpose. It is simply required in order to decrypt and encrypt data.

The Primecoin system stands out in that it uses the calculation of as-yet-undiscovered prime numbers as the complex mathematical problem which must be solved in order for new blocks to be created. In this way, the computing power and energy which is consumed by the cryptocurrency serves a useful scientific function.

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Editor Daniel Dreier
Daniel Dreier is editor and personal finance expert at moneyland.ch.