Ethereum 2.0 and The Back and Forth Decision on Progressive Proof of Work - What’s The Matter?
Currently, Ethereum is in the throes of a significant overhaul. The original smart contract blockchain is heading towards a change in consensus algorithm that will make it proof of stake; a move expected to help boost its performance.
However, inherent in making this upgrade a reality, which has been dubbed Ethereum 2.0, is a long and arduous roadmap with several updates and tweaks coming in. One of these tweaks has been the back and forth decision on ProgPow.
ProgPoW stands for 'Programmatic Proof Of Work.' It's an extension of the current Ethereum algorithm Ethash and is designed to make graphics cards more competitive and minimise centralisation.
There has, however, been some controversy about implementing this update, and it is still not finalised in the Ethereum community. People are concerned about pandering to Nvidia and AMD, as well as causing a diversion away from the proof of stake launch.
It could also lead to a hard fork as the parallel running of Ethereum 1.0 and 2.0 is still murky.
One of Ethereum’s creators, Kristy-Leigh Minehan, spoke to BDJ about the importance of the mining community. She talked about how this algorithm can empower miners and help drive curiosity and innovation in the Ethereum ecosystem.
ProgPow: What and Why?
The primary goal of ProgPow is to up the ASIC resistance and enable GPU miners to re-enter the Ethereum ecosystem. While there has been controversy about this algorithm, there is equal, if not more, concern about the domination of ASICs in blockchain mining.
It was in April 2018 when things started to get worrying for Ethash. Bitmain announced the Antminer E3 that boasted a hash rate of 180 mh/s and power consumption of 800 W. After that, other companies started producing ASICs as well.
“While there has been controversy about this [ProgPoW], there is equal, if not more, concern about the domination of ASICs”
This immediately meant that GPU miners were left for dead by this powerful hardware when it came to profits and thus they lost interest in network operations. Furthermore, the hashrate was suddenly concentrated in the hands of those who owned the expensive equipment, destabilising the very decentralisation of the network.
ProgPow steps in and takes back the power from ASIC chips thanks to two algorithmic features. ProgPow regularly changes the statement of the problem in mining, and it uses all components of graphics cards to their full extent.
The latter feature is what hamstrings ASICS because, as their name states - Application-Specific Integrated Circuit - they are designed to execute only one specific task.
Apprehension Around ProgPow
While, on the surface, ProgPow seems like a good idea for Etheruem to adopt - keeping it more decentralised and levelling the playing field for the miners - there is still some unease in the community.
One of the concerns ties back to the unclear roadmap of Ethereum.
When ETH 2.0 is launched, ETH 1.0 will continue to run in harmony with the new algorithm for an expected two to three years. This has caused many to ask if proof of work will continue after proof of stake comes in, and there is no clear answer.
Minehan explains why this is such a frustration. "Ethereum 1.0 vs. Ethereum 2.0… This is one of the biggest myths that frustrates me," she says.
"So, unless you are heavily involved in the Ethereum community, unless you are in the devcore, on Twitter, you would have no idea that there are two chains of Ethereum - 1.0 and 2.0, and that they work in harmony together.
"Everyone thinks it's binary, they think it's one or the other, that's it. The fact that ProgPow is going to be adopted, and Ethereum 1.0 will continue for two or three more years is incredibly confusing, and no one understands how that works.
“Average miners are asking: when Proof of Stake hits, does that mean there is no more Proof of Work? That is not clearly communicated anywhere"
"It is because the core devs, or whoever the spokesperson for Ethereum is, is not doing a good enough job of communicating that to the outside public. Average miners are asking: when Proof of Stake hits, does that mean there is no more Proof of Work? That is not clearly communicated anywhere."
Moreover, some feel that ProgPow is unnecessary as ASICs are known to make networks more secure, and there is very little evidence to suggest that they cause mining centralisation. On top of that, ASIC manufacturers are very dynamic and would probably create hardware that can operate this algorithm in a short time.
It goes deeper than just the technological side of things with this mining algorithm change. Minehan explains how empowering GPU miners strengthens the community and brings the right people to Ethereum, where the curious and the keen are needed.
The Right People
It must be remembered that Ethereum, in comparison to, say, Bitcoin, is a different beast. The smart contract blockchain is seen as Blockchain 2.0, and as such, it needs a different community to keep advancing the technology.
"Mining is a gateway drug to using cryptocurrency applications," explains Minehan. “You can't get around it. Look at Bitcoin, and you see all the Bitcoin wallets that are correlated with new mining wallets being created, this is just a thing that happens.
"People have a mining GPU, and they get curious, so they get involved and start exploring and seeing what they do with this, and then it goes down the rabbit hole. When you take away mining, you take away any incentive to participate in the network. When you isolate mining to an ASIC, you are isolating your user base. You are saying that unless you are an enterprise user, or unless you can shell out $5,000 for the equipment, you cannot participate in this network.
"Contrast this with a CPU or GPU, which everyone has in their laptop at home or desktop, and someone can download an application and jump in. What happens is because you are tuned to GPUs, you are now attracting developers.
“When you take away mining, you take away any incentive to participate in the network. When you isolate mining to an ASIC, you are isolating your user base”
“A lot of people say that GPU mining is bad and that it is hard, but what happens is it attracts people that have a sort of developing mindset. They have to start tweaking their GPU to get the best hash, they learn more about Linux, they learn about mining, how hardware works and this is a natural extension of getting into crypto and blockchain programming.
"You are attracting people that are naturally curious, and that should not be disregarded. ASIC does not attract curiosity because it is not a standard enterprise box that you are locked out of - it is a black box, you give it some power, give it some work and leave it alone."
What Minehan is suggesting is that ASIC mining is not genuine participation, it is rather profit-taking and capital funding - which is not necessarily a bad thing, but not what you need in Ethereum. Ethereum needs people to advance the uses of the technology, and with mining being a foundational entry to fully understanding blockchain, you want the barriers to entry to be as low as possible.
Minehan goes on the explain how ASIC is great for Bitcoin. "I was on a panel with a few companies that were very pro-ASIC, but they missed the point," she says. "You don't want to incentivise the Bitcoin network to have curious minds, what you want there are a ton of enterprises that are contributing their cash to stay locked to the Bitcoin network and to support it.
"That is the user base you want to target on Bitcoin - Banks, medium to large businesses, and investors and institutions. Therefore you need to ensure the algorithm and hardware are perfect marriage - ASICs are that marriage there.
"Think about Ethereum; it is a culture of developers; it is a world computer, so you need to attract the right kind of users; this means GPUs are the perfect hook."
The Current State of ProgPow
ProgPow, regardless of the controversy, has a strong support base from the miners, as well as most of the coin holders.
There are no pools currently that are against ProgPoW. All of them either vote Yes or stay away from this problem. Etherchain has created a special page with voting results from the last 24h.
Core Devs are also evaluating signals from the coin holders at progpowcarbonvote where over 2 million Ether (about 2% of total ETH supply) have stated their opinion on ProgPoW, with around 90% voting Yes.
Still, even with all this support, there has been a call to audit the ProgPow code before it is implemented, and as such, the Devs are in search of a firm to do it with a price tag of $100,000 on offer.
One of Proof of Work’s biggest potential problems is its energy usage. It is a system built to be deliberately consumptive of energy, in a quantity which only grows as the network itself grows. A recent estimate from the Cambridge Bitcoin Electricity Consumption Index found that Bitcoin accounts for 0.29% of the global total electricity consumption - a shockingly high percentage given the relative nascence of the technology.
The desire to build a form of proof that isn’t so energy-consuming is a big part of the reason that Proof of Stake has emerged as a popular alternative. By not requiring mining to operate, Proof of Stake systems are inherently far less energy-guzzling. This also makes the position of validating more accessible to those using the network as they require a fraction of the processing power, a factor those involved hope will help more people get involved. Proof of Stake isn’t perfect in many ways, but as interest in blockchain technology continues to swell, finding a greener alternative to energy consumption for energy consumption’s sake will be vital.
Illustrations by Kseniya Forbender
To contact the editor responsible for this story:
Margarita Khartanovich at [email protected]
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