Talking about ProgPoW again: What miners have to say about Eth2

On March 19, Vitalik finally summarized and explained the future plans for Ethereum. Ethereum is the world's largest public chain and crypto community, and its influence and leadership in the crypto world are unquestionable. However, on this long-term development path, there are many difficulties. Every update, every EIP initiation and execution may be smooth sailing or it may be a flash in the pan.

On the road from Eth1 to Eth2, the most controversial issue in recent days is the update of the ProgPoW algorithm. Because of ProgPoW, GPU miners and ASIC miners even formed two major camps. In the near future (when Eth2 is launched), miners in the two major camps may face huge changes. This article will explain the causes and consequences. We strive to clearly present ProgPoW and the crypto community for readers who follow Ethereum, and to help miners clearly understand how ProgPoW is closely related to mining.

Background on Ethereum

Cryptocurrency started with Bitcoin. Bitcoin designed the PoW consensus. All nodes use the PoW consensus to generate blocks, and each block is confirmed through chain broadcasting. After confirmation, it is saved in the confirmed node, so it becomes a Chain, which is the blockchain.

In order to keep the node miners mining continuously, a certain reward is set after confirming the preservation of a block, and the reward is Bitcoin. Many people will flock to it for the reward, so it is necessary to clarify who can save this block. The PoW Hash collision algorithm implements this selection process. Each node is a hardware with computing and storage functions. These hardware calculate the results by running the Hash collision algorithm. Whoever calculates it first will save it.

When the Bitcoin network was first built, there were very few people participating in the calculation process, so the founders needed to install the computing storage hardware themselves to perform the calculations. As more and more people participated, more and more people competed for the calculations, and the difficulty of the calculations increased. The relevant factor of this difficulty is the computing power of each computing hardware, that is, the computing power.

Each computing hardware is equivalent to a production machine. As long as it starts calculating, it can produce Bitcoin. The formula for this calculation process is the PoW consensus algorithm, which is also the Hash collision algorithm. The Bitcoin algorithm is SHA256. But the algorithms are different. When Ethereum established such a network like Bitcoin, the algorithm used by Ethereum is Ethash, which is also a PoW algorithm, but the calculation conditions are different (explained in detail later).

When the Ethereum network was first built, like Bitcoin, the initial team needed to build some hardware first, such as the network, and then "mine and produce blocks" through the design of this network. The initial Ethereum node was established by the Ethereum Foundation, and then more and more people joined, making today's network a reality.

With the design of the Hash collision algorithm, the higher the computing power of the mining node, the easier it is to mine. Even if the increase in the computing power of the entire network will increase the difficulty of mining, it is also possible to calculate the "formula" result faster, store the block and get the reward. Behind these computing hardware are people, called miners. And these hardware began to enter standardized industrial production (in order to improve the computing power of each computing hardware), called mining machines. The role of gathering the computing power of mining machines is like a "mining computing power pool", called a mining pool. After the mining pool gathers computing power, it directly connects to the network for calculation. Because of the high computing power, it is easy to save blocks and get rewards, and then distribute the rewards to each mining machine.

At this point, the collaboration between each role constitutes an industry that earns revenue by connecting to the cryptocurrency network to "mine". Subsequently, in this industry, mining machines continued to develop, and two types of mining machines with different mining methods emerged.

In order to improve the computing power of mining machines, mining machine manufacturers put a lot of computing chips together through the industrial combination of computing chips, and then run the Hash collision algorithm. Such hardware has many computing chips and small temporary storage space, which is suitable for highly repetitive and logically simple operations, such as Bitcoin's Hash collision algorithm SHA256. This kind of mining machine is called ASIC mining, that is, professional mining machine.

Before ASIC appeared, hash collision calculations were performed on CPUs and GPUs, which later developed into GPU mining machines. However, GPUs can be used on more mining algorithms because they can perform more complex logical operations, and can execute memory-dependent algorithms (algorithms that require greater temporary storage during calculations), such as Ethereum's Ethash algorithm.

If you use a GPU miner to calculate Bitcoin's SHA256 algorithm, the GPU miner will not be competitive due to its low computing power. If you use an ASIC miner to calculate Ethash, it is impossible to do so due to the algorithm requirements. The Ethash ASIC miners on the market are designed according to the requirements of the Ethash algorithm, and the computing power performance is far behind that of Bitcoin's ASIC miners.

Ethereum's white paper states that Ethereum will implement a new consensus PoS in the future, and this consensus is not achieved through PoW calculations. However, before all nodes develop to use PoS consensus, Ethereum uses PoW to establish a blockchain called Eth1, which runs the Ethash algorithm. However, the Ethash algorithm can also use dense computing chips to improve hardware computing power (which is significantly different from Bitcoin ASIC design), and Ethereum ASIC mining machines have also appeared.

In the Ethereum community, there have always been voices of resistance to Ethereum ASIC mining machines. The emergence of ProgPoW is also intended to resist ASIC (explained in detail later).

Why are ASIC mining machines resisted by the Ethereum community?

The emergence of Ethereum ASIC mining machines is the result of mining machine manufacturers designing them to suit the Ethash algorithm. The computing power of mining machines is not much different from that of GPUs. So why does the Ethereum community resist ASIC?

There are two factors that need to be mentioned here: first, the mining cost of ASIC miners is slightly lower than that of GPU miners, and they are easier to manage and maintain; second, the application scope of ASIC is too narrow.

For example, the Lightning GPU miner is composed of 8 AMD RX 470 4GB graphics cards. When mining ETH, the computing power is about 237MH/s, the rated power is about 1250W, and the price is about 17,000 yuan. For example, the ASIC Ethereum miner Antminer E3 has a computing power of about 180MH/S, a power consumption of about 800W, and a price of about 5,700 yuan. In comparison, the cost of ASIC is lower.

The relatively low-cost ASICs have led developers and miners in the Ethereum community to predict that ASIC mining machines may take over the Ethereum network in the future. This is a kind of "fear". The high risk of ASIC mining machines due to the price of coins or the profitability of large-scale mining is the main reason why some people in the Ethereum community resist ASICs.

Although ASIC has low cost, for miners, ASIC mining machines can mine fewer currencies and their scope of use outside of mining is too narrow. GPU mining machines are also called graphics card mining machines. As general computing devices, graphics cards can mine more currencies and can also be used for other purposes besides mining, such as big data computing, rendering, etc. The advantage of risk resistance will become more and more obvious.

Due to its long-standing community characteristics, Ethereum has a special preference for memory-dependent algorithms such as Ethash. In order to resist ASIC and to further optimize miners' use of GPU resources in the Ethash algorithm, Ethereum developers proposed the ProgPow algorithm, which is a further optimization of the Ethash algorithm.

The logic of ordinary mining machines is that PoW mining has a fixed algorithm, and the hardware (mining machine) can be designed to adapt to it, making it efficient when executing the algorithm. However, the design of the ProgPoW algorithm is "the opposite logic", which is to study the hardware (that is, GPU) and then modify the algorithm to match the hardware. "

For hardware, an effective algorithm needs to match the access pattern and sufficient hard disk space. ProgPoW is designed for the most commonly used graphics cards for blockchain mining, currently AMD's Polaris and Vega series graphics cards, and NVIDIA's Pascal series graphics cards.

What did miners and developers do after ProgPoW was proposed?

Currently, there are very few PoW coins that support the ProgPow algorithm, and large-scale stress testing is not enough. Although the algorithm's adaptability to hardware is indeed very attractive, there is still uncertainty. The ProgPow algorithm increases the advantage of miners in mining ETH, but it will also cause a certain increase in power consumption.

Controversy arose over this immature algorithm. In addition to technology, opponents also pointed out other influencing factors.

After the release of the ProgPow algorithm activation plan EIP-1057, some developers proposed EIP2583 to oppose the ProgPow algorithm. The proposal states:

Because Ethereum is a global platform with so many different stakeholder groups, it is critical that major changes to the protocol have clear goals and broad support. EIP-1057 clearly lacks that support, but is still being considered for activation.

EIP-1057 proposes replacing Eth1’s proof-of-work algorithm, Ethash, with ProgPoW. The stated purpose of this change is to disadvantage users of ASIC miners in order to avoid a contentious fork caused by ASICs during the transition to Eth2, but if activated it would contradict its own goals, increasing the likelihood of such an undesirable outcome.

If Ethereum will begin to transition from proof of work to proof of stake through the Eth2 beacon chain release. At this point in the evolution of Ethereum, changing the Eth1Hash algorithm will cause the community to split and should not introduce technical risks while energy is focused elsewhere.

More important than these statements is the fact that after two years of debate, EIP-1057 has failed to reach consensus in the Ethereum community, which has consumed a lot of developer attention and community resources. Forcing this controversial change will only widen the current rift, causing negative impacts on Ethereum and its community that will last for years, all without a clear reason.

In the face of disagreements, developer Ben DiFrancesco once proposed a compromise. Keep ProgPoW active in the follow-up of Eth 1.0 and trigger it when needed. But the Ethash algorithm will also be kept in existence, waiting for GPU miners to switch to ProgPoW. But it is estimated that 60% of GPUs are mining on the Ethereum network, of which 40% come from Ethash ASICs (cited in Dev call). If no action is taken, because ASICs are more efficient than current GPUs, Ethash ASICs may take over most of the hash calculations in the next few years, so GPU miners may also leave directly.

As the debate heated up, independent developer kikx also disclosed a vulnerability in the ProgPOW algorithm, pointing out that the hash function of the ProgPoW algorithm uses a 64-bit seed, but ASICs can "easily" enforce it instead of mining as expected. It will not pose a threat to the Ethash algorithm currently used by Ethereum, but it will prevent it from truly achieving the goal of anti-ASIC.

This vulnerability is mentioned in the design analysis article of ProgPoW. If an ASIC miner is designed according to the ProgPoW algorithm, its finished product performance and design structure will be almost the same as the current GPU miner, which prevents the design of ASIC miners using the ProgPoW algorithm from a cost perspective.

What will miners face as Eth2 approaches?

Strictly speaking, ProgPOW has no direct relationship with Eth2. Eth2 is a PoS consensus chain. Ethereum miners are only related to the PoW chain, that is, the Eth1 chain. After Eth2 goes online, Eth1 will also exist in Ethereum. It will become a shard chain of the Ethereum network, that is, it packages part of the data. As long as the packaging and block generation are normal, the miners' rewards will remain the same, which will be related to the transaction packaging data allocated by Ethereum to the Eth1 chain.

This is directly related to the income of all miners. In addition, it is also related to the trust of miners in the PoS consensus ecosystem. On today's Eth1, the importance of Ethereum miners is crucial. After the transition to PoS, because the Eth1 chain is only a small part of the entire network, the mentality of miners will also be affected.

In addition to the technical update, the ProgPoW incident also raised more issues about the governance of the cryptocurrency community. The decision-making of the decentralized community is wasting time because of repeated difficulties in reaching consensus.

In addition to factors that are beneficial to the development of the community, more stakeholders have also thought about their own interests, future beliefs, etc. One event reflects hidden problems in all aspects. The choice of miners is ultimately related to the role. No matter which mining machine is optimized, the advantages of large-scale mining will still exceed those of independent mining individuals. If you are a miner, you have to consider the cost and benefits. If you are a believer, you will move closer to the better direction of the community. If you are a developer, you may make a voting action mixed with various emotions, which will then trigger the entire community.