Google has has just announced the launch of their Gcoin as they unexpectedly shift gears toward the cryptocurrency space. The coin was launched last night, 12:00 AM PST.
Like many of Google’s products, the coin is to function around the company’s dominant search functionality. The mining of coins is powered by search queries from users around the world. The momentum of computing power needed to execute the query propels the hashing necessary to generate new coins.
By the same token, miners can profit by supplying the “searching power” necessary to execute, rank and optimize queries. Each new milestone reached releases a “GBlock Reward” to the individual or pool resolving the latest difficulty level.
The mining algorithm is neither SHA-256 nor Scrypt, rather Google’s in-house Gryptotech algorithm. There is also no set block processing time. Rather, the time will depend on several factors, such as current user volume on the web, current variability is search content and the number of coins in circulation.
There is no upper limit on the number of coins in existence, but practically speaking, the difficulty level is expected to increase such that within 36 months, it will be impossible to advance beyond 6,000,000 coins. The code will not be open source, at least at the start.
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The only way you can hold Gcoins is through Google Wallet, which has been specifically tailored for this cause. Anyone with a Google account can send or receive Gcoins from any other Google account holder. This completes the loop of what exactly Google was contemplating several weeks ago when rumors circulated as to its support for Bitcoin and they launched a survey inquiring on how Bitcoin can best be integrated into its offering.
It is not yet known if Gcoin will trade on any of the exchanges, or if its codebase even allows for it. It is speculated though that Gcoins will have monetary value for Google’s paid services such as Adwords.
In September, Google will also launch its specialized mining equipment for sale. The GMiner will start in the initial phase, followed by the larger, more powerful Gurricane which will be capable of generating 100 PHs (100 Petahash per second).
All Gcoin transactions are recorded on a public ledger, the Gchain.
Google Chairman Eric Schmidt said:
“We were initially skeptical about the whole notion of cryptocurrency due to its huge volatility, susceptibility to hacking and low penetration as an accepted payment method. We later realized that soon or later, this will be the only form of monetary transfer. We weren’t the first in the search engine space, and now we’re the leaders. There’s no reason why we can’t do the same when it comes to cryptocurrency.”
Google’s move into this space, while totally unexpected, is a sensible move for a company with loads of cash and a depletion of profitable ideas to spend it on. At least for now, it’s kept its edge over the other search giants.