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How resistant is ‘ASIC-resistant’?

asic resistant

Many supposedly ‘ASIC-resistant’ algos out there aim to democratise crypto mining, with regular CPUs and GPUs alone intended to maintain the networks. Unfortunately, the nature of chip design and economic incentives mean that ‘resistance’ can only ever be a temporary state.

So-called ASIC-resistant mining algos are all the rage. The idea is to return crypto to that golden age where it truly was democratic, and anyone could mine bitcoin with their CPU. (Incidentally, as a little piece of history, it was Bitcoin Pizza guy Laszlo Hanyecz who first figured out he could use his GPU to turbocharge his mining – that was one of the reasons he had so many BTC to spend on pizza!)

The mining arms race

An article published last year by the Sia team strongly suggests that the only way to remain ASIC resistant is to keep changing mining algos, forking the network to stay ahead of the chip designers who will create custom hardware if it’s worth it. It’s not a question of if, but when: it’s only a matter of time. One of the prompts for writing their article was Monero forking to stop the new generation of ASICs from taking over the network.

Sia, that has first-hand experience of mining chip development, notes that it’s very hard to design computational tasks for which optimised hardware cannot be created. This has been borne out by history, as chips for supposedly ASIC-resistant algos like Litecoin’s Scrypt have been developed. And it doesn’t take very long to do it, either, especially if you can just adapt existing chips. Chip manufacturers use various tricks and shortcuts to cut their lead times. While that can sacrifice performance, the results will still beat CPUs and GPUs hands down – in just months.

Secret miners

One somewhat depressing thought from the team is that most of the large-cap ‘ASIC-resistant’ coins very likely already have ASIC miners, developed in secret and collecting a large amount of coins on the quiet. It is, simply, economically profitable to do this. The chips would only be released for public sale when the developers have created something better for themselves. Add to that the fact that large miners hold monopolies (forget manufacturing ASICs in China unless you’re Bitmain – others have tried and found themselves hamstrung) and it’s abundantly clear that mining can be a very dirty business.

Sia summarise the situation as follows: ‘The biggest takeaway from all of this is that mining is for big players. The more money you spend, the more of an advantage you have, and there’s not an easy way to change that equation.’

Satoshi’s ‘One CPU, one vote’ ideal was just that – an ideal. Sadly, it’s one the crypto world will constantly have to struggle to maintain.