Author: Nancy, PANews

The long-dormant Solana mining protocol, Ore, has recently returned to the market spotlight. Amidst a generally sluggish market, Ore's price has hit a new high for the year, and the protocol's daily revenue is also steadily increasing, rapidly boosting market sentiment. This change is primarily attributed to its recently launched new V2 mining protocol, which features comprehensive upgrades in both its mechanism and economic model.

Ore launches new mining protocol as revenue and coin price both soar.

Recently, the long-established project Ore has become popular again, and has received support from Solana, sparking market attention and discussion.

Data confirms this surge in popularity. According to Blockworks Research, as of November 6th, Ore's cumulative revenue had exceeded $1.689 million. Before mid-October, its daily revenue remained low, mostly hovering around a few thousand dollars. However, since October 22nd, Ore's daily revenue has experienced explosive growth, climbing to over $100,000 in just over ten days, with the latest daily revenue reaching $316,000, an increase of approximately 576 times compared to the historical low ($548). Revenue for the past week reached $1.094 million, accounting for 64.7% of the cumulative total.

Alongside the surge in revenue, the price of ORE tokens has also soared. CoinGecko data shows that as of November 6th, ORE was priced at approximately $249, representing a 2445.2% increase over the past 30 days, reaching a new high for the year, and its latest market capitalization has exceeded $100 million.

Ore's resurgence stems from its new mining protocol launched on October 22. On that day, Ore's official Twitter account, which had not been updated for several months, announced that it would return to the stage with a brand-new mining protocol, aiming to achieve a sustainable token economy and protocol value capture mechanism, and to create a native store of value asset on the Solana chain.

The new mining mechanism is more like an on-chain game of strategy. The system consists of a 5x5 grid with 25 blocks, each round lasting one minute. Miners can "occupy space" on the grid by staking SOL tokens. After each round, the system randomly selects a winning block, and all the SOL from the other 24 non-winning blocks is distributed proportionally to the miners on the winning block, with the distribution ratio depending on the size of their space in that block. Additionally, one lucky miner from the winning block will receive an extra 1 ORE as a reward (this special round occurs approximately every three rounds).

Building upon this, the system introduces the Motherlode prize pool mechanism. Each round of mining injects 0.2 ORE into this pool, triggering an additional grand prize with a 1/625 probability. If not triggered, the pool continues to accumulate; once a prize is won, all accumulated rewards are distributed to the winner according to the miner's contribution. This design, similar to a cumulative prize pool, enhances random incentives and long-term participation motivation.

When miners withdraw their mining rewards, they need to pay a 10% "refining fee," which is automatically redistributed proportionally to miners who have not yet withdrawn their rewards. This means that the longer you hold your coins, the higher your returns, thus encouraging long-term holding and reducing selling pressure.

In addition, Ore will automatically deduct 10% of the SOL mining rewards as protocol revenue, of which 90% will be burned and 10% will be distributed as proceeds to stakers. This means that...

Furthermore, according to official disclosures, the ORE token maintains its original maximum supply limit of 5 million tokens and a stable issuance rate of 1 ORE per minute on average. However, due to the introduction of protocol revenue and an automatic buyback mechanism, the net issuance can dynamically balance between inflation and deflation. If protocol revenue is sufficient, ORE may enter a deflationary phase. Dune data shows that ORE has been in a deflationary state over the past 7 days, with the total supply decreasing by 400 tokens.

It can be seen that, compared with the early PoW mining model, the new version of the Ore mining protocol has undergone multiple optimizations in terms of mechanism design, incentive structure and economic sustainability.

It once caused congestion on Solana, and the version update failed to reverse the decline in popularity.

Ore was originally an innovative Proof-of-Work (PoW) mining protocol on Solana, developed by Regolith Labs, led by anonymous developer Hardhat Chad, and launched as the winning project of the Solana Renaissance Hackathon. Public information shows that Regolith Labs completed a $3 million seed round of financing in September 2024, with investors including Foundation Capital, Colosseum, and Solana Ventures.

The project aims to introduce a Bitcoin-style mining mechanism to the Solana network, achieving fair and pre-mined token distribution. Users do not need specialized ASIC miners; they can participate in mining by solving cryptographic puzzles using ordinary devices such as computers, tablets, or mobile phones. This low-barrier-to-entry design quickly attracted significant attention, making Ore a popular project within the Solana ecosystem.

After Ore v1 was launched, the influx of users was astonishing, and it once became the program with the highest trading volume on Solana, generating approximately 1 million transactions per hour at its peak. Some users even earned thousands of dollars per day during peak periods, further stimulating participation and driving the price of ORE from its initial price of $93 to a peak of $3,786.

However, the v1 algorithm had a gamification problem, with some miners increasing their "hit rate" by submitting transactions at high frequencies, leading to a massive amount of spam transactions and severe congestion on the Solana network. As a result, Ore had to suspend mining. Hardhat Chad explained that it would take several weeks to assemble a team, research, and release version v2, a change that also helped the price of ORE recover.

In August 2024, Ore v2 mining was restarted, introducing several improvements to address the pain points of v1, including optimizing anti-Symania attack strategies, adjusting mining difficulty, and introducing a staking mechanism. However, due to lower-than-expected mining returns, the price of ORE plummeted, and its popularity also declined.

Ore's latest mining mechanism combines GameFi and DeFi elements, moving away from the traditional "mine, sell, withdraw" model. Through a delayed redemption mechanism, miners need to participate continuously to maximize their profits. Currently, a redemption surge is only triggered when the reward pool approaches the staking pool level. Simultaneously, the protocol enhances the sustainability of the economic model, making Ore more aligned with the market's preference for deflationary narratives. However, whether this mining frenzy can be sustained remains to be seen.