April 9, 20185min4905

Is Ethereum threatened by aggressive centralization of Bitmain?

Ethereum may be threatened by aggressive centralization of its network by Bitmain miners since their recent decision to keep the Ethereum mining protocol without a change, which would make mining with ASICS inefficient like with Monero protocol.

Many Ethereum developers are coming out in favor of a fork that would effectively disable the ASICS hardware.
While ASIC mining, in theory, increases security, it also leads to centralization based on the ability to secure the powerful, expensive machines which are in domain few.

Vitalik suggested the issue may not be worth the coordination required to make the change, stating:

“Getting everybody to upgrade is likely to be fairly chaotic and detract from more important things. So, at this point I personally lean quite significantly towards no action.”

You can listen to Ethereum Core Developer Meeting #36 [04/06/18] and find out more about the topic.

Ethereum community is asking for an update, to stop any ASICS miners from turning into mining Ethereum and make the monopoly out of it. Like they manage to do with Bitcoin based on their processing power.

In theory, Ethereum should move to a proof of stake, with partial mining being scaled out. But there is a question if they will be able to migrate to a hybrid POS/POW faster than ASICS miners can make the monopoly.
The Ethereum plan is to migrate to a new protocol in future called Casper.

So how is Casper different from other Proof of Stake protocols?

Casper has implemented a process by which they can punish all malicious elements. This is how POS under Casper would work:

  • The validators stake a portion of their Ethers at stake.
  • After that, they will start validating the blocks. Meaning, when they discover a block which they think can be added to the chain, they will validate it by placing a bet on it.
  • If the block gets appended, then the validators will get a reward proportionate to their bets.
  • However, if a validator acts in a malicious manner and tries to do a “nothing at stake”, they will immediately be reprimanded, and all of their stakes are going to get slashed.

Casper is designed to work in a trustless system and be more Byzantine Fault Tolerant.

Anyone who acts in a malicious/Byzantine manner will get immediately punished by having their stake slashed off. This is where it differs from most other POS protocols. Malicious elements have something to lose so it is impossible for there to be nothing at stake.

This is not the only place where Casper punishes the validators.

As Hudson James and Joris Bontje note in their answers in “StackExchange,” Casper designs harsher incentives to guarantee network security, including punishing miners who go offline, unintentionally or not.

This means that validators will have to be careful about their node uptime. Carelessness or laziness will lead to them losing their stake. This property reduces censorship of transactions and overall availability.Along with all that, the “slashing” property also lends Casper a distinct edge over standard proof of work protocols.

The community is divided as well one in favor of fork others against it.

Here is a comment from Reddit user bijansha who is against the fork :

It’s too much work to do a hard fork all around the planet. And the world is not a standing still and other competing services such as Cardano and EOS are coming. We should bite the bullet on this and stay focused on POS.




About us

We are the new economy news hub. 2100NEWS is the professional index, data, and tools provider in the digital asset space, offering Crypto Market Intelligence, providing the perspective you can trust and equipping you with information edge you need to stay ahead. (Real-time data of token issuers and news, analysis and commentary from community.) We are very excited to contribute to the evolution of the industry and build an ecosystem around our offering (the institutional-grade data infrastructure required to enable institutional investments in digital assets). We want our contributions (Contents and Tools on 2100NEWS.com) to be useful for helping investors.




    • ethereumEthereum (ETH) $ 3,122.35 0.91%
    • litecoinLitecoin (LTC) $ 83.76 0.22%