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Phoenixcoin


Phoenixcoin (ticker symbol: PXC) is an open source decentralised P2P currency. It was released on the 20th of May 2013 as a further development of Litecoin, a popular fork of Bitcoin, under the terms of the MIT/X11 licence.

The Phoenixcoin distributed network is proof-of-work based. It generates coins at a decreasing rate and is scheduled to produce 98 million coins. The current generation rate is about 24 thousand coins per day or 720 thousand coins per month. As of the 1st of January 2018, the Phoenixcoin network has generated 63.0 million coins.

History



The early days of Phoenixcoin were full of great expectations which turned into yet another cryptocurrency drama.

Origins

May 2013

Phoenixcoin was founded by Phenix Crypto Systems Network Inc., owned and operated by John Carmiche (JohnCar) and Michael Burns (iamatrix). The first block was mined on the 8th of May 2013, but the currency wasn't released to public until about 20 thousand blocks were produced which resulted in a pre-mine of about 1 million coins (0.6% of the total coin supply advertised at 168 million initially). The original name was Phenixcoin. The coin was supposed to be used for various projects by the founding company such as Phenix Poker or Phenix Safe Trade.

Phoenixcoin was added to Cryptsy on the 24th of May 2013, once a leading cryptocurrency exchange focused on alternative coins, but the trading was suspended on the next day per developer's request and restored on the 31st of May 2013.

The UNOCS

July 2013

On the 11th of July 2013, Phoenixcoin together with Feathercoin and Worldcoin established the UNOCS (United Open Currency Solutions) 1, an alliance aimed at joint cryptocurrency development and promotion. The first joint project was supposed to be the Bridge 2, a cryptocurrency to fiat payment processor. It was scheduled for the public release on the 21st of July with a massive marketing effort including a count down timer on the UNOCS web site, unocs.com, but got delayed by 24 hours allegedly to allow a DDoS protection to take place. After that it was delayed again and again. As a result, this project had been never completed and the alliance fell apart on the 13th of September after Feathercoin declared their withdrawal. 3

PhenixEx

August 2013

Another ambitious project, PhenixEx, a cryptocurrency exchange, was released for beta testing on the 24th of August 2013. As people started to transfer their coins in for trade and it started to become a popular place, the first issues appeared. Many users experienced severe difficulties with deposits and withdrawals starting with the 11th of September. Michael Burns, who was the lead developer of the currency and also the operator of the exchange, referred to his own sickness and assured the community of the issues to be fixed soon, but it didn't happen. The official web site, phenixcoin.com, and the forum, forum.phenixcoin.com, were taken offline on the 14th of September and the whole situation started to smell fishy. Michael Burns responded with a notice on the 27th of September citing complications in real life and his resignation as the lead developer. He also promised to pay out everyone manually, but only small payouts were made until he ceased any forum activity and disappeared. It was revealed later that both coin founders had a shady history (Michael, John). Michael sold nearly all of the pre-mine on Cryptsy, about 800 thousand PXC, in June and July of 2013 with a further conversion of BTC to USD for his own good. The community was unaware absolutely of his actions which may be considered as a theft because these coins were declared a community property to be used for give-aways, bounties, prizes and other means of promotion. In fact, only a small fraction of the pre-mine was used for this purpose, about 200 thousand PXC.

New Life

October 2013

As the currency became abandoned and the community started to dissolve, John Doering (ghostlander) took over the development on the 1st of October 2013 and released an updated client, v0.6.4.12, with the IRC bootstrapping fixed which allowed peers to find each other on the network and process coin transfers. In addition, he renamed the currency to Phoenixcoin and designed a new logo. He declared to pursue the development in a transparent way with a high level of community involvement. 4 As the original forum had been gone, the new official Phoenixcoin forum was established at Cryptocointalk where it operated until 2016. The new official web site went online two weeks later on a different domain name, phoenixcoin.org

Specifications



Phoenixcoin has had 5 hard forks which have changed the technical specifications significantly. The currency was released with Scrypt as the basic hashing algorithm, a total supply of 168 million coins, 50 PXC per block, a block target of 1.5 minutes, difficulty retargets every 2400 blocks, a 4.0 difficulty limiter.

As Phoenixcoin ran into a serious difficulty trap early in June of 2013, the 1st hard fork took place at block #46500 (19th of June). It reduced the interval between difficulty retargets from 2400 to 600 blocks and the difficulty limiter from 4.0 to 1.8 which helped for a short while.

The 2nd hard fork took place at block #69444 (2nd of August 2013). It was infamous for taking people by surprise as it was released with a 6 hours advance notice only and played with things which were better left unchanged. The block target was halved from 1.5 minutes (90 seconds) to 45 seconds while the block reward remained at 50 PXC per block. Simply said, the coin generation rate was doubled. Such developer's incompetence made many coin holders dump and leave. Most of the pools failed to update in time which caused losses to their miners. In fact, even most of loyal miners had switched elsewhere soon after. To make a conclusion, it was a plain disaster.

The 3rd hard fork at block #74100 (30th of August 2013) was supposed to fix the previous one. The block reward was halved down to 25 PXC per block and the block target was adjusted to 45 seconds to restore the previous generation rate of 48 thousand PXC per day. Averaging window was reduced to 126 blocks and difficulty limiter was set at 1.09.

The 4th hard fork was prepared by the new lead developer. It took place at block #154000 (16th of November 2013). It was meant to remove all code of the previous developer and write new one with protocol settings suitable for the long run. The block target and block reward were restored at 1.5 minutes and 50 PXC respectively, the total coin supply was set at 98 million. A significant update was made to the difficulty retarget algorithm. All previous implementations operated with averaging windows sized equally to retarget intervals. Although small retarget intervals with small averaging windows have advantage of smooth difficulty transitions which keep actual block targets close to nominal and deliver better rewards to loyal miners, there is a serious threat of time travel attacks with difficulty traps. To address this issue, a complex algorithm has been developed. It retargets every 20 blocks, but operates with two reasonably large averaging windows of 100 and 500 blocks each. Results of both windows are averaged again, damped with a 0.1 coefficient and passed to a 1.02 difficulty limiter. There were additional precautions taken to reduce efficiency of time travel attacks. The 4th hard fork also included support for broadcast synchronised checkpoints also known as the ACP (Advanced CheckPointing) to prevent massive block chain reorganisations also known as 51% attacks. The ACP code was written by Sunny King of Peercoin and Primecoin and merged into the development tree of Feathercoin on the 20th of August and next to Phoenixcoin.

The 5th hard fork switched Phoenixcoin from Scrypt to NeoScrypt. It also adjusted max. difficulty change on every retarget to be between +2% and -5%.

Current Specifications

  • NeoScrypt (N = 128, r = 2, p = 1, etc.)
  • ~98 million total coins
  • block target is 1.5 minutes
  • block reward is 25 coins
  • block reward gets halved every 1 million blocks
  • retargets every 20 blocks (~30 minutes)
  • +2% to -5% max. change on every re-target
  • advanced averaging: 100 + 500 blocks 0.1 damped
  • advanced checkpointing against 51% attacks
  • the default P2P port is 9555, RPC port is 9554

Transactions



Every block on the Phoenixcoin network contains transactions. The process of block generation, known commonly as mining, requires significant computational resources. In order to encourage mining activities, every node which manages to generate a valid block receives a fixed block reward together with transaction fees if any. The block reward value gets halved every 1 million blocks (nearly every 2.85 years). The transaction fees are small optional payments issued by senders to get their transactions processed at higher priority. The total coin supply is finite and estimated at 98 million.

Confirmations



Transactions are contained in blocks. Every valid block is added to the network block chain, a list of all generated blocks starting with #1 block known as the genesis block. Every next block references one previous block, thus a chain is created. A transaction is considered complete after 6 confirmations usually, i.e. when 6 blocks have been added to the block chain after the block containing this transaction. Although this is not mandatory and confirmation policies may vary among receivers. Mined rewards require a higher number of confirmations, 101 currently, to become spendable.

Addresses



Payments on the Phoenixcoin network are made to unique addresses which are based on digital signatures. They appear usually as strings of 33 characters which always begin with ''P'' such as
Puicad2AcZRj9DgF8WJtywBU7AbMxxLGAS 7

Every address corresponds to a unique private key known to the owner only. It's nearly impossible to find out a private key using a brute force attack.

Mining Algorithm



Phoenixcoin used initially the Scrypt algorithm for proof-of-work introduced by Colin Percival. 5 It was first used for coin generation purposes in Tenebrix and became very popular thanks to Litecoin. Bitcoin employs a different hash function, double SHA-256. Phoenixcoin operates with a block target of 1.5 minutes which is nearly 7 times faster than Bitcoin (10 minutes) allowing faster transaction processing. The Phoenixcoin network adjusts the hashing difficulty every 20 blocks to maintain a given block generation speed, and this process is known as retargeting. Litecoin and Bitcoin feature a much slower 2016 block retarget rate. The difficulty is adjusted according to the total network computational power which is called the hash rate. There is a limiting coefficient implemented which assures that no difficulty increase higher than 1.02 or decrease lower than 0.95 may take place.

Scrypt was chosen because it suited CPUs and GPUs better than double SHA-256 pioneered by Bitcoin in 2009. SHA-256 is a very memory inexpensive algorithm which can be implemented in FPGAs and ASICs using simple register based logic. The first SHA-256d ASIC, the Avalon 1, was advertised in late 2012 with the mass adoption in the first half of 2013. The other manufacturers and models followed. Scrypt required a considerably large 128Kb memory area per hashing thread which was a complication for the FPGA and ASIC development. However there were techniques available for Scrypt which allowed to reduce the memory requirement down to 64Kb because Scrypt wasn't computationally hard enough. Rising market capitalisation of Litecoin and other Scrypt based cryptocurrencies in 2013 combined with manufacturing availability of eDRAM made ASIC development for this algorithm quite feasible. First Scrypt ASICs, which were based on the 55nm GridChip GC3355, hit the market in early 2014. It was a matter of short time for the improved models to replace GPUs completely on this algorithm.

The objective was develop a new algorithm which could replace Scrypt in the GPU mining. Huge ASIC based farms are a threat to decentralisation and fair coin distribution. The new algorithm called NeoScrypt 6 was released on the 27th of July 2014. It employed the Salsa20/20 and ChaCha20/20 stream ciphers, the BLAKE2s hash function as well as the FastKDF key stretcher and compressor. There was also a separate mode of operation which allowed for backward compatibility with Scrypt to ease deployment. Phoenixcoin pioneered NeoScrypt on its network on the 14th of August 2014.

Footnotes



1. UNOCS Press Release: Feathercoin, Phenixcoin and Worldcoin are proud to announce a partnership to advance world-class digital currencies (11th of July 2013)

2. CoinDesk: Altcoin partnership UNOCS launches Bridge service for instant merchant payments (30th of July 2013)

3. CoinDesk: UNOCS altcoin partnership dismantled following Feathercoin pullout (16th of September 2013)

4. CoinDesk: PhenixCoin in ashes after developer goes AWOL (7th of October 2013)

5. Stronger Key Derivation Via Sequential Memory-Hard Functions by Colin Percival, 2009.

6. NeoScrypt, a Strong Memory Intensive Key Derivation Function by John Doering, 2014.

7. Phoenixcoin Block 1 on the official Phoenixcoin Block Explorer.