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Adjusted Compound Reward
Peercoin has a 1% inflation rate to allow for participant determined growth over time. Fully deflationary currencies cannot be used as mediums of exchange, but rather solely stores of value. By allowing for a manageable inflation rate, Peercoin remains scarce while allowing for growth determined by participation. This also helps offset coins that are removed from circulation through lost wallets or malevolent destruction.
Fixed transaction fee
Peercoin has a fixed transaction fee that filters out the kind of spam transactions that have damaged chains like Bitcoin. A fixed fee also allows for predictable sending fees, which may become unpredictable on chains where fees can rapidly change, leaving transactions in limbo for several days. This allows for first come, first served transactions as well. Peercoin is able to scale without worrying about valuation effecting usability. In version 0.7, the transaction fee is being lowered from 0.01 Peercoin to 0.001 Peercoin.
How can the Peercoin network survive without miners providing PoW security, especially during times of low interest?
Proof-of-work serves as an inflationary mechanism to distribute coins. The Peercoin network is secured by coin age and proof-of-stake. With pure proof-of-work chains, holders have little ability to secure the chain with the high cost of mining equipment acing as a barrier to entry. Any Peercoin holder can protect their investment by allowing a transaction to mature and leaving their wallet open. Proof-of-stake minting has kept the network secure since Peercoin's inception.
Peercoin strives to be the most secure cryptocurrency with the lowest cost, rewarding all users for strengthening the network by providing them with 1% of annual revenue per minting.