Categories: Ethereum

What is Ethereum’s ProgPoW and how is it impacting miners?

Click here to view original web page at finance.yahoo.com

The Ethereum ProgPoW could split the Ethereum community down the middle and have significant consequences on the network’s evolution. The new Programmatic Proof-of-Work mining algorithm was agreed on by Ethereum miners and coin owners through an online processing vote. However, now that it is entering an “audit” phase, many parties are debating the wisdom of their decision. Could the Ethereum ProgPoW force another hard fork in 2019? It’s still too early to make predictions. However, more and more voices are talking about a split – whether the developers implement the new algorithm or not. What is the Ethereum ProgPoW? Programmatic Proof-of-Work is nothing more than an extension of the Ethereum algorithm Ethash. The upgrade is meant to help graphics cards

The post What is Ethereum’s ProgPoW and how is it impacting miners? appeared first on Coin Rivet.

The Ethereum ProgPoW could split the Ethereum community down the middle and have significant consequences on the network’s evolution. The new Programmatic Proof-of-Work mining algorithm was agreed on by Ethereum miners and coin owners through an online processing vote. However, now that it is entering an “audit” phase, many parties are debating the wisdom of their decision.

Could the Ethereum ProgPoW force another hard fork in 2019? It’s still too early to make predictions. However, more and more voices are talking about a split – whether the developers implement the new algorithm or not.

What is the Ethereum ProgPoW?

Programmatic Proof-of-Work is nothing more than an extension of the Ethereum algorithm Ethash. The upgrade is meant to help graphics cards become more competitive against ASICs. This way, miners can fight back against centralisation on the blockchain.

Sole miners who don’t have the resources to invest in expensive equipment can still have a chance of making profits from mining.

Why is the Ethereum ProgPoW important?

Since Ethereum was designed as a decentralised network, miners could use their GPUs to validate transactions and add new blocks to the chain.

But when tech companies started producing ASICs (which are more powerful than graphics cards and consume less energy), making profits using GPUs became a lot harder.

An ASIC (Application Specific Integrated Circuit) is specially designed to do one thing only – solve hashing problems and generate new coins.

The new equipment left GPU miners substantially out of pocket. Many of them, in fact, are still struggling to recover their initial investment.

This situation is leading to a loss of interest in maintaining network operations for Ethereum. Miners are moving to other blockchains where they have higher chances of getting rewards.

The domination of ASICs leads to a concentration of power in the hands of a limited number of users who own the right equipment. Decentralisation is therefore at risk. A handful of people could potentially gain control of 51% of the network. That would be enough to manipulate the entire blockchain.

The Ethereum ProgPoW consensus algorithm doesn’t eliminate ASICs. Instead, it brings some balance back to the equation by making them less effective than GPUs. The ProgPoW also aims to prevent a monopoly among equipment manufacturers by reducing the influence of ASIC users on the blockchain.

The principle behind this extension is quite simple. The algorithm uses all components of GPUs to their full extent while changing the problem in mining regularly.

By creating these random sequences of problems, the network requires more flexibility – a characteristic that ASICs don’t have for now. GPUs adapt faster to changes, making them more competitive against ASICs.

An unnecessary diversion from the Proof-of-Stake move?

The problem with ASICs’ domination is not new. The crypto community is split between people who see ASICs as a threat to decentralisation and those who have the resources to invest in expensive equipment to gain higher rewards.

Ethereum is already an “ASIC-resistant” network. And it’s not the first blockchain that would see a hard fork occur as an attempt to render ASICs unprofitable.

However, the adoption of the Proof-of-Stake consensus algorithm is the most effective way of countering ASICs’ domination once and for all. This is why Ethereum developers have been planning a switch to Proof-of-Stake for almost four years.

In this light, the Ethereum ProgPoW seems like an unnecessary diversion since it won’t have significant long-term effects on the network anyway. It’s just a matter of time before tech companies develop new ASICs for mining with Ethereum’s ProgPoW.

What about the audit?

The audit for the Ethereum ProgPoW has raised more controversy in the crypto ecosystem. Miners and coin owners who have already voted for the Programmatic Proof-of-Work algorithm are feeling undermined.

The audit performed by Least Authority (an independent German security consultant) is supposed to buy more time before integrating the extension.

However, there is increasing pressure from influential community members that have spoken against ProgPoW more than once. The audit of the code seems to be just one way in which developers are trying to deal with the criticism.

Miners are essential for maintaining the blockchain, but loyalty alone doesn’t pay the bills. So, unless mining on Ethereum brings in a profit, many miners will look for more advantageous blockchains.

According to developers, the ProgPoW should balance forces on the network and encourage decentralisation. Miners will have more chances of making profits regardless of their equipment. This should be enough to motivate them to maintain network operations.

On the other hand, ASICs have their benefits, as they have higher hash power per unit of electricity and are more secure. Moreover, many community members don’t see this equipment as a real threat to decentralisation. It would likely take hundreds (or even thousands of ASICs) to control 51% of the Ethereum blockchain.

So how will things end up for Ethereum and its controversial ProgPoW? Will we have another major hard fork in 2019? It’s still too early to make predictions, but like anything in crypto, all bets are off.

The post What is Ethereum’s ProgPoW and how is it impacting miners? appeared first on Coin Rivet.

cinerama

Illuminati, Mason, Anonymous I'll never tell. I can tell you this, global power is shifting and those who have the new intelligence are working to acquire this new force. You matter naught except to yourself, therefore prepare for the least expected and make your place in the new world order.

Disqus Comments Loading...
Share
Published by
cinerama

Recent Posts

Binance Coin Outlook For September 2019

SummaryBinance continues to be the number one crypto exchange throughout 2019, and BNB, its native token, has established itself as… Read More

1 hour ago

Johnstone: Biden’s Brain Is Swiss Cheese And It’s Creepy That We’re Not All Talking About It

Authored by Caitlin Johnstone via Medium.com, I didn’t watch the last Democratic presidential primary debates because I figured that without… Read More

1 hour ago

Will Bitcoin Mining Confidence Cause A BTC Price Spike To $28k?

Data from blockchain.com shows Bitcoin’s hash rate is at all-time-high. Last week, it peaked at 98.5 quintillion hashes per second.… Read More

1 hour ago

Bitcoin Mum despite Saudi Attack Raising Demand for Haven Assets

Bitcoin appeared stuck in a price-range on Monday as attacks on Saudi Arabia’s oil facilities raised concerns over global energy… Read More

1 hour ago

Bitcoin-Pumping Wealth Advisor Licks Chops Over Fed Meeting

A $10 billion wealth advisor predicts the next Fed rate cut will launch the bitcoin price to a new yearly… Read More

1 hour ago

High Throughput Blockchain Velas Lists on Leading Cryptocurrency Exchange BW.com

ZUG, SWITZERLAND / ACCESSWIRE / September 16, 2019 / Velas AG, the developer of the AI-powered DPoS blockchain of the… Read More

1 hour ago

This website uses cookies. We use these cookies to collect data about your interaction with our website for the purpose of continuously improving your experience with our site. For more information we encourage you to read our privacy policy.

Read More