The cryptocurrency industry is constantly under development as the technology underpinning blockchain is still very new. One such project that may undergo an important update to its mining algorithm is Ethereum.
On January 4, members of Ethereum’s open-source development community came to a preliminary agreement to implement an important new algorithm that blocks specialized mining hardware, or ASICs.
The proposed algorithm change would block ASIC miners, which are primarily used by large mining operations such as Bitmain.
If the proposed code change is accepted by the Ethereum network, mining farms like Bitmain will be prevented from mining Ethereum, and would thus allow for a more decentralized system.
ProgPow Mining Algorithm
The proposed algorithm change is called “ProgPow.”
While this code change blocks ASIC miners, it allows space for general purpose or GPU hardware to mine. GPU hardware can still be used to mine Ethereum today, but powerful ASIC miners have pushed this method out as it’s not as profitable as using ASICs.
ASICs were first developed for Ethereum as early as April 2018, and have since been dominating the mining space. While this hasn’t really been a big issue other than the centralization of mining, it could pose problems for Ethereum’s eventual transition to Proof-of-Stake.
Speaking about the proposed mining algorithm change, security-lead Martin Holst Swende said that a switch to ProgPow would help to ease and ensure the safety of Ethereum’s transition to PoS.
As stated by Swende:
We know today that Ethhash has flaws which are currently being targeted. So, that’s why I would like to switch as soon as possible to give us time to move to Proof-of-Stake.
For those who don’t know, Proof-of-Stake is a new system of mining cryptocurrency but without the burning of electricity. Instead, users set aside coins they already hold and stake them for the mining of new blocks.
To conclude the discussion among the open-source Ethereum developers, Ethereum Foundation communications officer, Hudson Jameson, came to the conclusion that the developers have tentatively agreed to implement the new algorithm.
Sounds like we have come to agreement that we are tentatively going ahead with ProgPoW, which means we are going ahead unless there is a major problem found with the testing or things of that nature. We will be going forward with ProgPoW.
Unless the developers face unexpected issues during testing, ProgPow is expected to be implemented in the next 2 to 4 months as a standalone system-wide upgrade (hard fork).
In addition to the proposed ProgPow code change, Ethereum is set to undergo a major system upgrade, Constantinople, on January 16. This will be Ethereum’s 5th major upgrade and was originally scheduled for November 2018.
Constantinople is said to include an array of design changes including improvements to streamline Ethereum’s code and the delaying of Ethereum’s difficulty bomb, which is a code fix designed to prompt frequent upgrades.
This upgrade will also reduce the Ether mining reward from 3 ETH to 2 ETH per block.
Another hard fork, dubbed “Istanbul,” which is different from the the ProgPow upgrade, is planned for October 2019. The Istanbul upgrade is part of a periodic upgrade cycle and is to be expected to maintain the network.
Regarding the timing and exact date of the ProgPow upgrade, it is uncertain. However, we can expect an update the next time Ethereum developers hold their dev call on January 18.
As stated by Swende:
Let’s do some homework until the next core dev call and see how people can implement [ProgPoW] into their frameworks and maybe we can talk about timing in two weeks.
Do you think this ProgPow upgrade is necessary? What do you think about Ethereum’s future with all these upcoming upgrades and changes? Let us know what you think in the comment section below.