Is the ASIC Resistance dream closer to reality, despite claims of it being a myth?

“Today we know that centralization and big bureaucracies have not, as promised, been the answer for promoting better opportunities for society” ~ Carlos Salinas de Gortari

To ASIC or not to ASIC has been the dilemma for years now. For some, the distinction is very easy; it comes down to choosing between centralization and decentralization. For others, it is about taking all the aspects of mining into consideration and opting for what’s best suitable for the end participants and the network altogether. With ASICs in the scene, one side of the coin depicts decentralization, the other side portrays centralization. A coin that’s puzzling not only to the ones in the cryptocurrency space, but also to the ones outside.

While there are many projects that completely oppose even the idea of ASIC mining, there is an equal number of projects or even more that have warmly embraced the new idea. And, why not? Decentralization means an open-market, which in turn symbolizes technological advancement.

On one hand, the argument that’s pro-ASIC is that “it contributes to the network security,” which is debatable. On the other hand, the argument that it leads to centralization of the network is something that’s hard to be brushed off. The security threats of ASIC mining centralization include ASIC boost, selfish mining, eclipse attacks, and launching a 51 percent attack without having 51 percent hash power (just by collaborating with three or four other mining pools). The problems of ASIC mining have taken a prominent seat in the crypto-market.

The largest cryptocurrency, Bitcoin, is among those cryptocurrencies that have been pro-ASIC mining, and it is because of this very cryptocurrency that ASIC mining has gained a strong foothold in this space. The mining evolution from CPU to GPU to FPGA to ASIC completely superseded Satoshi Nakamoto’s “one CPU, one vote” rule.

Speaking to AMBCrypto, Bob Summerwill from ETC Cooperative said,

“If you see what’s been happening with every single cryptocurrency has ASICs, even the ones that claim to be ASIC resistant. And the reason is very simple, it just you can do it more efficiently. You are just doing a fairly simple algorithm and doing that in hardware is going to more efficient than doing it in software. There’s no going around that and the economic is such that you just cannot resist. It’s just futile to try and resist. The ASICs are going to happen anyway and they are actually good for you. So, resisting is futile and actually counter productive.”

While Bitcoin itself is relatively safe from the biggest problems of ASIC mining and centralization - 51 percent attack, the same, however, does not hold true for other cryptocurrencies. The reason is quite simple; the cost of BTC mining and the price is higher compared to the rest of p-o-w coins. In short, it’s possible, but it’s not quite feasible for the attacker considering there would also be a war against the rest 49 percent, and even if one percent hash rate is lost to the other side, it would mean game-over. Meaning, there’s zero economic incentive for launching a 51% attack on Bitcoin.

A classic example of the blunders that can be caused by mining pools powered by ASICs is the Bitcoin Cash vs Bitcoin Satoshi Vision hash war that took place towards the end of 2018. Some market speculators even claimed that the hash war resulted in not only two different chains, but also the crash of Bitcoin’s price and hash rate towards the end of last year.

While many are of the opinion that ASIC-resistance is futile, there are still projects that stand firm against ASIC-mining, keeping decentralization as the most important goal, even though there hasn’t been any substantial proof that this is an achievable goal.

Ethereum and Monero were the two coins that held the beacon of ASIC Resistance; Ethereum with back-and-forth discussion over implementing ProgPoW, and Monero with RandomX.

“On Sunday, 1 December 2019 15:19:47 GMT 603 blocks were removed from the VTC main chain and replaced by 553 attacker blocks. We note that 600 blocks is the current confirmation requirement for VTC on Bittrex. There were 5 double-spent outputs in which ~ 125 VTC (~$29) was redirected. Each of the double-spent outputs are coinbase outputs owned by the attacker and it is unknown to whom the coins were originally sent before being swept to an attacker address after the reorg.”

While the topic of ASIC centralization continues to be hot debate every now and then, Blockstream, a blockchain technology company, unveiled its mining colocation service and Blockstream Pool, earlier this year. In an episode of Magical Crypto Friends, CSO of Blockstream, Samson Mow, said that the pool would be contributing to Bitcoin’s mining decentralization as it utilizes BetterHash protocol. Mow had stated,

After all that’s said and done, the question here is not if ASIC resistance or mining is the way, but is Decentralization truly achievable?