I posted back in December about the fun of playing with some of the alternate cryptocurrencies, and since then things have gone a bit crazy. Hashco.ws, Middlecoin, and the other multi-coin pools do a reasonable job at adopting any of the coins that look like they have some staying power. For example, LEAF got picked up by Hashco.ws, but if you were into LEAF a day or two before HC arrived, you could have made out with a whole lot of LEAF -- or BTC after trade. Early on, LEAF was earning about 0.05 BTC per MHash, so 10 MHash would have pulled in 0.5 BTC in a single day -- and if you waited to trade a few days, instead of 0.5 BTC you could have more than doubled that amount!
Anyway, I don't want to get too sidetracked. One of the big searches I've had is for an alternative to all the scrypt cryptocurrencies -- because once ASICs really start to come online, they all will see ramping difficulties in short order. It's what I like about Vertcoin (and potentially Microcoin, though I don't like the MRC block reward rate much), but those are still GPU-mined coins. I have a bunch of PCs with CPUs sitting mostly idle, or at least I did back in December, and since Quark was a dead end I was looking for something similar.
Frozen was my short-term solution, and I made about 5 BTC in trades during December and January by mining FZ. Yeah, think about that for a moment: 5 BTC in less than two months, without buying any additional hardware. Right now however FZ is stagnating, and with good reason: it's on the downward spiral into being mined out, and the glory days of 50 FZ blocks every 30 seconds have become 9.8 FZ rewards -- and at the same time, the network hash rate for FZ has jumped from 500 KHash to a high of around 5000 KHash before dropping back to 1500 KHash.
Today, you can still make money on Frozen, but it's not that much -- a Core i7 can run at perhaps 800 KHash/sec on the Quark algorithm, yielding around 18 FZ per day (and dropping). The exchange rate is 0.00013 BTC per FZ, give or take, so that's around 0.0023 BTC per day, or $1.87, with a power draw of around 90W for the CPU, so $0.20-$0.40 in power costs means it's a net gain. But what about other coins that use Quark, or maybe even something better?
Well, Fairquark is currently out of the running, as 800KHash would net you 32 FRQ per day, but they're only worth 0.0000004 BTC at present, so unless the value rises about 20X, FZ is a better option for CPU mining. Dimecoin is pretty much a waste as well, with a heavy premine combined with a huge bonus on the first 1024 blocks. But there's another option, which I think has far more potential than any of the Quark-derived coins. Enter Darkcoin, aka DRK.
Formerly called Xcoin, Darkcoin has as a goal the idea of truly anonymous transactions. That's fine and all, but more interesting is that DRK uses a new Proof of Work algorithm: X11. Similar to Quark's six rounds of hashing based on nine different algorithms, X11 instead goes with eleven different hashing functions. That means there are currently zero GPU miners available (unlike the rather iffy smelter.exe you can use with the quark algorithm), though I suppose if DRK continues to trend up someone is bound to create a GPU miner.
Right now, a single Core i7 CPU will hash at around 250KHash on X11, which will net you about 112 DRK per day (and dropping with the rising difficulty). The exchange rate meanwhile is doing okay right now, but it could trend up fast in the near future. If you sell at the current 0.00003 BTC per DRK, you're still going to make more than any other CPU-mining coin I can find, about 40% more than Frozen. $2.70 per day for a Core i7 desktop means $2.50 per day of profit after power costs, and $75 per month extra. That pales in comparison to some of the other cryptocurrencies, but at the same time, if you have the CPUs, why not use them?
There's only one (potentially major) problem with coins that can be effectively mined with CPUs: the dreaded botnet. Unfortunately, it's a real problem and something no one has really managed to address. Imagine this: instead of a virus that creates popups on your PC when you're infected, what if you were to install and run a CPU miner? Not only are you not paying for power, but all transactions go onto a mostly anonymous network. I think this is much of what keeps Quark alive these days, and probably most of the other coins where CPU mining still makes some sense. The real solution is for people to stop downloading and running malicious software, but that's not going to happen I suppose.
In the meantime, you can be like me and come join the DRK side! :-)