All the cryptocurrencies in the world are derived from mathematics —- if you can solve complicated mathematical problems faster than anyone else, then you can make profits.
As a result, members of cryptocurrency community found themselves in a symbolic arms race of hash race where they could run the mining equipment with poor performance in early stage. And now, the increasing difficulty means they need more efficient ASIC miners.
ASIC stands for “Application Specific Integrated Circuit.” It’s a type of computer chip which can complete one mission with maximum power and efficiency. Dedicated ASIC chips have driven the development of various electronic devices in the past, but when they appeared in 2013 and were used for encryption applications, they squeezed all other miners out of the market.
The mining standard used to be GPU mining, where people adopted high-performance GPUs to run mathematical calculations to produce cryptocurrencies. GPU is the most popular choice because it has rich and powerful performance —- with only one game PC with powerful GPU, you can successfully mine the cryptocurrencies.(Read more: The Past Decade of Mining Industry) However, ASIC is better than GPU and the designs are also better, faster and stronger than that of the best GPU miners.
So, many people had to withdraw from the cryptocurrency industry in the early stage —- they couldn’t compete with the latest ASIC chips. The self-established mining workshops with GPU miners had exterminated before the appearance of ASIC miners. If you invest time and money to support the encryption ecosystem (and earn some money at the same time), then you can expect that the GPU miners will disappear overnight.
This is happening now in the field of Ethereum. The core developers are pushing ahead with plans to implement new POW algorithms which will make the dedicated ASIC chips much less efficient for Ethereum mining. It will preserve the space on Ethereum network to enable small GPU mining workers to regain more control over the blockchain and gain more profits.
The ASIC-Resistant algorithm in cryptocurrency is a way to protect small businesses without running industrial-scale mining equipment. GPU workers are the first group of people succeeding in mining cryptocurrencies because their hardware capabilities can solve complex mathematical problems. They did it quite well.
But multifunction GPUs can’t compete with highly specialized ASIC chips which can solve the proficiency problems. For the sake of the interests of GPU workers, the communities developed from cryptocurrencies should be protected first.
But simply speaking, the real ASIC- Resistant algorithms are not permanently feasible.
We only need to have a look at the history here. Take the Monero as an example, it has experienced repeated tug-of-war with ASICs and GPUs.
Monero has been designed as an ASIC- Resistance since the first day of its birth(Read more: The Untraceable Private Crypto Currency Monero). It went very well at first until the effective ASIC chips began to be dedicatedly used for Monero mining. The community conducted a hard fork for the new algorithm to make this new hardware ineffective. GPU workers returned to the top —- but only for a short time. It is only a matter
It has been changed since then: Monero introduced a semi-annual hard fork to protect GPU mining workers, and then a new and improved ASIC chip re-established its role of dominance.
It’s important that the ASIC chips can still completely crack the ASIC-Resistant algorithm. Although it’s hard for this type of mathematical design to solve this kind of hardware, ASICs can still make it. The only problem for those running the hardware is whether the cost of electricity and hardware worthwhile?
The cryptocurrencies with ASIC-Resistant algorithm are not permanently feasible because we humans tend to develop our technology to infinity. Regardless of the restrictions, we have a good record of always finding suitable solutions. The speed of racing car is getting faster and faster, the sporting performance of humans is getting higher and higher and even the computer seems to get better and cheaper every year. Whenever the new technical issues are raised, we can always find a corresponding technical solution in the future.
The appeal for ASIC-Resistant algorithms is just a voice which says, “you can’t make a versatile chip,” but the human instinct is more inclined to say “yes, we can make it.” That’s why ASIC miners are adopted for cryptocurrency mining.