FairCoin 2 is the innovative version of earlier FairCoin. It works on the principle of co-operation rather than competition, thus creating better efficiency. FairCoin2 is different from other cryptocurrencies because it does not involve mining blocks based on competition.
The transaction blocks are generated by so-called Certified Validation Nodes (CVN). These nodes co-operate to maintain the security of the network. Therefore, this system is called Proof-of-Cooperation (POC).
PoC is a consensus algorithm which is required in the P2P network of a cryptocurrency. Every node in the network must carry out the same set of rules to maintain the fairness. All connected clients have the same data available to verify the state of the network. In the case of FairCoin a limited number of trusted nodes (CVNs) work together to create the FairCoin blockchain. CVNs require private keys to create and sign blocks. These private keys are stored on smart cards to achieve maximum security.
FairCoin has a total coin supply of 52 million coins and is traded with a tickr symbol of FAIR.
In the new version of FairCoin, new blocks are generated by Certified Validation Nodes (CVN). These nodes work together to secure the network by validating the transactions that has been sent to the network. To run a CVN, it is necessary to complete a certification procedure called node certification operated by FairCoop.
The money supply remains unchanged on creation of blocks and there is no reward for creation of blocks contrary to other cryptocurrencies. The transaction fee that is charged from the users is awarded to the block creators for running a CVN. Every information about CVN and FairCoin block chain administrators are stored in the block chain. Every CVN participates in the consensus process by digitally signing the pieces of data for confirmation of its approval. These digital signatures are the actual consensus proof that are collected by the CVN for creation of the next block and thus the proof-of-cooperation of all CVNs.
The overall block validity, integrity, its transactions and other payloads are verified and after the new block has passed all consensus checks, it is sent out to all other nodes.
The previous version of FairCoin relied on mining and minting technology to secure the blockchain that is based on competition. The new version has been developed with the assumption that co-operation is more efficient than competition.
Compared to other cryptocurrencies, FairCoin is a fair and democratically conceived cryptocurrency that is equal to all users. Its high efficiency, trusted node relations and low energy costs makes it one of the best currencies for micropayments. It can also be used for point-of-sale systems in shops, for prepaid cards, for direct currency exchange or for direct payment of invoices.