Rumors surrounding a new Ethereum mining rig from leading mining hardware provider Bitmain have resulted inEthereum prices dropping below a one-week high of USD 585. Ethereum isn’t the only blockchain network wary of new Application-Specific Integrated Circuit (ASIC) mining tech, with Monero already set to resist ASIC mining earlier this week.
Rumors with substance
The stories sparked up when CNBC reported a statement Susquehanna analyst Christopher Rolland had written to clients:
“During our travels through Asia last week, we confirmed that Bitmain has already developed an ASIC [application-specific integrated circuit] for mining Ethereum, and is readying the supply chain for shipments in 2Q18. While Bitmain is likely to be the largest ASIC vendor (currently 70-80% of Bitcoin mining ASICs) and the first to market with this product, we have learned of at least three other companies working on Ethereum ASICs, all at various stages of development.”
Traditionally, Ethereum has been mined using GPUs, but the new ASIC from Bitmain would result in even higher entry barriers for the casual miner. The most devoted of crypto enthusiasts see this as an antithesis to the blockchain ideology; ASIC mining rigs are often at the centre of controversies and are far more expensive than the GPUs used primarily by gamers, outclassing them in mining power.
Cause for controversy
While ASIC chips have been Bitmain’s powerhouses for mining Bitcoin and Bitmain’s mining pools account for significant portions of all the processing power on the global Bitcoin network, they are still finding themselves coming up against a great deal of resistance.
The shakeup comes down to the technology creating such high barriers that lead down a road of centralization. On top of that, GPU mining competition could be threatened by the new hardware, potentially causing GPUs to become obsolete, forcing miners to move to other newer cryptocurrencies despite the fact that GPU mining has proven profitable for Ethereum miners so far.
Even Monero appears to be taking on Bitmain. Earlier in the month, Bitmain announced the latest rollout of purpose-built Monero mining rigs, the Antminer X3. This, according to a post made by Monero, opens plenty of issues for the network and does not fit with its network ethos.
It is not clear what the ASIC boom will bring to the competition of the global mining arena, but the contentious tech could spell an end for GPU cryptocurrency mining and perhaps the majority Ethereum GPU mining.