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A million dollar bet The test of Ethereum's game is not coming



What happens if ethereum never changes its basic consent algorithm?

It is an idea that may seem blasphemous to developers who build the world's second largest blockchain, where plans have long been planned for a transition from the bitcoin testing model to a more egalitarian alternative. Yet, it seems that entrepreneurs are betting that between today and that bright future, a small fortune could be waiting.

Already several mining companies have invested millions in building specialized mining chips for ethereum, machines that will only work as long as the network distributes new cryptocurrency to those who dedicate computer hardware to the effort.

One of these is Chen Min, CEO and founder of Linzhi, a Shenzhen-based startup that has spent $ 4 million to try to design the fastest specialized mining chip, or ASIC, for ethereum. An industry veteran, Chen was formerly the chief designer of Canaan Creative, one of the three (largely focused on bitcoin) that dominated the production of cryptographic hardware in the last decade.

However, since then it has started to work on the construction of machinery for ethereum, already investing widely in the goal.

"The cost to get to the first silicon and sampling machines is about $ 4 million, plus the cost in terms of operations, wages, and office, all of which are modest, lean and efficient," Chen said.

Announced in September, the Linzhi ASIC promises to overcome previous ASIC etium projects, with significant improvements in terms of energy efficiency and computing power. However, the mining chip will only work on ethereum if the blockchain maintains its current code base.

But Chen is not too worried.

"I do not know if [ethereum] will or will not pass the pole test, "he told CoinDesk," The pole test has many problems. "

There is evidence that Linzhi is not alone in this position. As detailed in CoinDesk, mining giant Bitmain released its etherum miner, Antminer E3, in March, while Innosocilion announced three miners ethereum in July.

While Chen recognizes the inherent risk of introducing an ASIC into such an unpredictable environment, he told CoinDesk:

"The information is open, we do not hide this risk, our customer can decide to buy or not."

High-risk climate

Support for Chen's belief is also an idea that proof-of-work is simply a better way to manage the distribution of cryptocurrency prizes. In this way, Chen described a possible test passage as "not a smart thing".

"There are so many people, so many users, developers and hardware have invested in that coin: if they ignore the work done and go to game tests, maybe later they can even ignore your bet and move on to evidence-some other idea ", said Chen.

But there are also other risks for the extraction of ASICs on ethereum.

Last week one of the main developers called the ProgPoW engineers – a proposal that would have changed the code to allow only the miners of the GPU as an alternative to the ASIC. Although still being proposed, if implemented, ProgPoW would effectively disable ASICs from the ethereum extraction – and the momentum is building towards implementation.

Chen, however, argued that such ideas are little more than mere reactions, those that do not actually provide solutions to some of the concerns about how etheric rewards are distributed in the community at large.

"ProgPoW is driven by large farms that have not revealed their true intentions," Chen said, adding:

"Bitmain's fear is driving the [ethereum] community in the arms of some very powerful well-funded farms they do not even know about ".

Kristy-Leigh Minehan, one of the main developers of the ProgPoW switch, rejected this claim, claiming that "large-scale GPU farms do not really exist". In a sense, Minehan is demonstrating that GPUs can promote more participants in the protection of ethereum, which argues that ASICs can not do so because of their costs and operational needs.

Advantages for the hardware

More generally, the push for ProgPoW is typical of what has been termed "crypto war to miners", in which several cryptocurrencies have moved to remove ASIC hardware manufacturers from their respective networks.

However, according to Chen, most of the conversation about removing ASIC from ethereum does not take into account the kind of advantages that specialized hardware can bring to a cryptocurrency project.

"Our chip is optimized, specialized for ethereum, not just for the mining industry, but also for the verification and functioning of the nodes, so I'm very curious to know why people think it's wrong," Chen told CoinDesk.

Chen added that specialized hardware is often condemned for moral, non-rational, scientific reasons.

Pointing to the scale challenges faced by ethereum, Chen theorized that advances in mining hardware could even help ethereum overcome current concerns about scaling down to more people and more transactions.

"[Ethereum] it is still so far from the traditional banking system. I think that hardware can contribute, "he said.

In his mind, because ASICs will be able to extract ethereum faster and more efficiently, they will be able to process more transactions at a faster rate. "If we have a sufficiently fast physical layer," he said, the community will not have to rely on complex software scaling solutions, such as sharing.

Chen described Linzhi deeply interested in participating and assisting with the improvement of the ethereum protocol.

In fact, underlining a recent proposal by ethere founder Vitalik Buterin offering a hardware-based scaling method that runs zk-snarks, Chen said that Linzhi would be able to produce such hardware in the future, although it is not on their schedule.

Last resource

All in all, it is the last sign that you are discussing a broader topic on how ethereum will guarantee its $ 22 billion blockchain. However, this topic may not break at any time from the original roadmap.

Speaking with CoinDesk, Hudson Jameson, a communications officer at the Ethereum Foundation, said he was unaware of any ASIC advocate in the ethereum developer community who could protest against the plan to move to the stake test.

Much of the movement stems from the idea that the presence of ASICs optimized to run only one particular algorithm could interfere with a step-by-step proof-of-stake transition, now dubbed "Shasper" due to its merging with the resizing method , sharding.

"This is the whole reason why ProgPoW was created: to guarantee [ethereum] it could safely transit to [proof-of-stake] with no bigger parts like Bitmain that manipulates the currency and the price, "Minehan told CoinDesk.

Nevertheless, Chen did not express excessive concern in this regard, stressing that such efforts are still very "in the state of the proposal".

Regardless, Chen has urged that, in the case of ProgPoW or game play, Linzhi will move to the mining ethereum classic, a rival ethere platform that separated from the blockchain in 2016, and which traditionally has been more friendly with ASIC hardware.

He told CoinDesk:

"We would like to reduce the power consumed to guarantee [ethereum], but if they want to attack with waste of GPUs managed by two companies and powerful problems of secret agriculture, then we will continue to do [ethereum classic]".

Image of the database via Shutterstock


The leader in blockchain news, CoinDesk is a point of reference that is committed to the highest journalistic standards and adheres to a strict set of editorial policies. CoinDesk is an independent operating subsidiary of the Digital Currency Group, which invests in criptovalute and blockchain startups.


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