Ethereum woes deepen with the compatibility of ASIC devices
It seems to be widely accepted within the cryptocurrency community that Bitcoin mining is dominated by the few, not the many. There’s just no getting around the fact that unless you have the very latest, most powerful ASIC device in the market, you stand very little chance of competing for the highly lucrative ten minute block reward of 12.5 BTC.
In fact, even those in possession of an Antminer S9 have since been superseded by the newly released DragonMint T1 Asic, which is able to generate a remarkable 16TH/s. Nevertheless, the issues of centralization within the mining space was something that Ethereum enthusiasts have never needed to concern themselves with — that was, until Bitmain announced that they had designed a new ASIC device that is fully compatible with the Ethereum blockchain.
In a nutshell, the underlying Proof-of-Work consensus mechanism that supports the Ethereum blockchain has an algorithmic code installed known as Ethash, which supposedly restricts the use of ASIC devices. The reason for this was to ensure that everyone has an equal playing field when it comes to mining. As a result, GPU devices were sufficient for success. It therefore comes as no surprise to learn that those from within the Ethereum mining space are somewhat displeased – with various sections of the community threatening to walk away unless something is done to stop the blockchain going the same way as Bitcoin.
To add salt to the wound, the impending Constantinople upgrade — Ethereum’s four stage development plan — which aims to improve the protocol’s issues concerning rising costs and validation times, is expected to reduce mining block rewards from 3 ETH down to 2 ETH. Interestingly, the vote to reduce the mining reward– known as EIP 1234, was justified with the view of maintaining stability of the ETH token and essentially limit its long-term supply growth.
Nevertheless, if the Ethereum Foundation didn’t already have enough on their hands, they now need to make a decision on whether or not to prohibit the use of Bitmain ASIC devices, as well as any other hardware designs that have the capacity to circumvent Ethereum’s Ethash safeguard.
Will Prog-PoW provide the solution?
Just like in the case of Bitcoin, any underlying changes that are made to the Ethereum client must first receive consensus. One such proposal that has been put forward to the community is an algorithmic coding upgrade known as Programmatic Proof-of-Work for Ethash, otherwise referred to as Prog-PoW.
Essentially, the proposal outlined argues that by forcing the blockchain to extract 80% of a GPU’s hashing power when mining, it would render ASIC utilization as redundant. This is because the Prog-PoW mechanism would see an ASIC device mirror that of a GPU, meaning it’s significantly more powerful capabilities would not give the miner any more of a statistical chance of winning the reward.
However, the key word here is “consensus.” It is well known that the Ethereum community can appear somewhat intransigent to change, especially when one looks at the ongoing saga regarding the blockchain’s scalability woes. Ultimately, if the Prog-Pow proposal does not receive the required consensus to make the coding change, then the Ethereum mining space could very quickly become dominated by the few, not the many.