Pseudonymous blockchain blogger Hasu has released an analysis of the latest Vertcoin attack. Published on the Deribit blog, the article makes a credible argument that ASICs enhance blockchain security by introducing an incentive to act in the interests of the network.
The Altcoin Case for ASIC-Resistance
As Bitcoin evolved, so did the prevalence of Application Specific Integrated Circuit machines . An ASIC is a piece of hardware that exists only for the purpose of mining. As a single-purpose device, its mining performance vastly outscales GPUs, meaning that Bitcoin mining is all but impossible on generic hardware nowadays.
The popularity of ASIC-resistant mining algorithms emerged from smaller altcoins like Vertcoin attempting to prevent centralization. The argument goes that by ensuring that anyone can mine using just a GPU, these altcoins can democratize access to mining. Doing so will ensure that mining spread over a larger group who may not want to invest in application-specific hardware.
This school of thought came about partly as a backlash against Bitmain and the major mining pools, which were discussed as being a threat to decentralization. The narrative was that Bitcoin’s security could be compromised if these big mining pools decided to team up and attack the network.
However, as blockchain has evolved, it’s become apparent that attempting to maintain ASIC-resistance is a cat-and-mouse game. ASIC manufacturers are constantly releasing new products, meaning that blockchain developers have to continue upgrading their mining algorithms in an attempt to oust ASIC miners from the game.
Reversing the Argument
Now, this latest analysis of the Vertcoin attack introduces a compelling new argument into the ASIC debate, which actually works in favor of using ASICs as a means of increasing blockchain security.
The central crux of the reasoning is around incentives, based on the principle that ASIC mining makes a network more expensive to attack. As Crypto…