The crypto community is bracing for a real revolution – leading cryptocurrencies may abandon the Proof-of-Work (PoW) algorithm. The reason is the far-reaching game of mining giant Bitmain, which is building up its monopoly on the market by stamping out new ASICs for top coins. This concerns not only the users who prefer traditional GPU farms, but also the developers themselves, as the ecosystem becomes increasingly centralized and vulnerable to attacks.
It seems that the line production of short life ASICs for new coins has turned into an arms race between Bitmain and less-rapid rivals. Everyone wants to bite off the last piece from the PoW algorithm, promising a quick payback and leaving no chance to traditional GPU farms. The first Antminers are sold out before the start of sales, and users seem to receive the promised profit. If it were not for one thing – ASICs are quickly becoming unprofitable, and growing hash rates lead to Blockchain centralization.
In the community, Bitmain has gained a reputation of a “greedy bunch” after using a huge hashrate on its own pool (Antpool.com) to block important votes in the Bitcoin network. The resistance formation itself began at the start of the year when Bitmain suddenly announced the launch of Antminer A3 production for SiaCoin mining, destroying 4 months of labor of its old competitor Obelisk.
We are proud and happy to announce that we are launching the Antminer A3, a new Antminer model to mine cryptocurrencies using the hashing algorithm Blake(2b).
The actual price and option to buy will be available here https://t.co/mrymOaMy4iafter 2:30PM (17 Jan, GMT+8). pic.twitter.com/Ye0cxNn95M
— BITMAIN (@BITMAINtech) January 17, 2018
At that time, David Warrick, the founder of SiaCoin and owner of Obelisk, did not fulfill his soft fork promise and gave Bitmain a chance to fix the situation.
After much consideration and discussion, we’ve decided to not invalidate A3 miners via soft-fork unless Bitmain takes direct action to harm the Sia project. We’re incredibly excited about 2018 and will move forward stronger. Full response: https://t.co/I96X8Y6VMi
— Sia Tech (@SiaTechHQ) January 25, 2018
Actually, the situation was corrected by itself. At the start of sales, Bitmain promised a daily profit of $460, which in just 10 days fell by 2 times, with only $10 to date.
Image source: Whattomine
Yellow card #1
The winter party A3 was not sold out yet when Bitmain announced a new model, which this time would take up the extraction of more popular coin, Monero (XMR):
We are pleased to announce the all-new Antminer X3, to mine cryptocurrencies based on the CryptoNight hashing algorithm.
Two batches: shipping in June (https://t.co/VeidZrreK2) and shipping in May (https://t.co/RKtJe6Rm8D)
To prevent hoarding and to enable…. (1/2) pic.twitter.com/PBKdXrwg9b
— BITMAIN (@BITMAINtech) March 15, 2018
Already tense, the state of things was further fueled by Baikal, which following its rival hastened to bite off a piece from the Monero pie. Developers of the latter were less compliant than SiaTech and kept their promise to conduct a hard fork for resisting ASIC mining. Nevertheless, Bitmain didn’t arrive and withdrew from responsibility for possible problems with Monero, promptly placing the following disclaimer on its website:
“One major cryptocurrency which is using CryptoNight hash function is about to change their PoW algorihtm [CT: site misprint], and according to their public statement, it is purposely to brick ASIC mining rigs including X3. When you buying it, you are betting that they are wrong.”
Although ASIC miners support other coins, for example, Bytecoin, Aeon and Dash, what about the $4,500 profit promised per month that turned into a pumpkin? […]