Cryptocurrency mining is undoubtedly a fundamental area in the functioning of the ecosystem of the mineable cryptoactives, such as Bitcoin. It is the decentralized consensus process through which the validity of transactions is determined and security is provided to the network, in addition to allowing the creation of new cryptocurrencies. However, it is a highly competitive activity, where participants struggle to win the right to create a new block and obtain the corresponding monetary reward that implies.
This dynamic has stimulated the development of increasingly specialized hardware, such as ASIC mining equipment, whose processing power is a considerable advantage over devices such as CPU, GPU or FPGA. The superiority of this hardware has positive implications, insofar as they contribute to raising the hashrate (power of processing) of the network and the difficulty of mining, which results in greater security. However, they also pose a significant risk of centralization of mining in favor of manufacturers or interested groups (pools), capable of concentrating a significant number of these pools.
This is a risk that the development teams of some cryptoactives are not willing to run. In 2018, several projects modified or updated their algorithms in order to avoid the incursion of ASIC mining into their ecosystems. This movement of resistance to ASICs involved some of the important cryptoactives in the market.
In February of this year, Monero's development team announced that it would bifurcate its network to modify its mining algorithm, called CryptoNight. The main purpose of the update was to block access to any ASIC mining device specialized in its algorithm.
The bifurcation, which took place at the beginning of April, reduced the processing power of the Monero network to 20% of its capacity. Although this fact was later compensated with the reduction of the difficulty, at that time, Reddit users pointed it out as evidence that Bitmain ASIC devices were silently mining monero (XMR).
The team of developers of the project had already established a public position in favor of the resistance to the ASIC miners, where they pointed to the objective of promoting "egalitarian" mining, favorable to decentralization. Likewise, they committed to slightly modify the PoW consensus protocol (proof-of-work) in each bifurcation. This in order to increase the cost of developing ASIC chips compatible with the Monero network and making its production unviable.
The promise was fulfilled with the next scheduled update, which took place on October 18. Within the framework of this bifurcation, the team announced the adjustments to the PoW in order to preserve the ASIC resistance.
Since the launch of a new Bitmain ASIC miner for siacoin (SC), in early 2018, the developers of the project expressed their alarm and rejection. As it was said in January of this year, it was feared that Bitmain would saturate Sia's network and severely affect its stability.
Likewise, the startup accused Bitman of secretly undermining siacoin, just as it had done with monero, even before launching its new mining hardware on the market.
This panorama produced a debate within the project's ecosystem, where the proposal of a soft bifurcation emerged, which would specifically invalidate ASIC miners who are not Obelisk Siacoin. The approach, made in an open letter by the community of Sia, did not materialize immediately, for different reasons alleged by the project development team. However, after several months, the first of October it was announced that the bifurcation would be carried out as a way to end the monopoly of Innosilicon and Bitmain over the network.
With the update, which occurred at the end of October, teams from Obelisk, a subsidiary of Nebulous, owned by the main developer of Sia, established themselves as the only ASIC miners authorized to operate on the bifurcated cryptoactive network. This fact produced some critical comments, but even so, the community mostly supported the fork.
Another of the cryptocurrencies that was threatened by ASIC mining was Ethereum, whose algorithm, Ethash, was designed to be resistant to this type of chips. However, in April of this year, the manufacturer Bitmain launched an ASIC compatible equipment for the mining of ether (ETH).
Although the community of Ethereum was favorable to a bifurcation to block the access of these devices to their network, the project development team, led by Vitalik Buterin, decided not to give this passed. However, later, in May, a new protocol was announced for the mining of ether developed by the miners of the Ethereum network.
The ProgPoW (Programmatic Work Test) was presented at the official developer meeting in May. This solution was created with the objective of "closing the efficiency gap available for specialized ASICs"; which implies a competition between ASIC devices and GPUs (graphic cards), which minimizes the centralization of the network.