What would need to happen for Bitcoin to fork to a ASIC resistant mining algorithm like RandomX used by Monero for CPU mining only?
asked Dec 14, 2019 at 23:02
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3 Answers
The bitcoin community would have to decide that they don't particularly care about having significant security anymore. ASIC-resistance weakens the security of proof of work chains because it eliminates the need to invest in a chain in order to attack it.
Someone who owns lots of expensive ASICs will not want to let them be used to attack the chain they are mining because if they harm that chain, they will significantly reduce the value of their own ASICs. By contrast, if you can mine with commodity hardware, attacking the chain does not significantly reduce the value of your hardware, so you have no real incentive to prevent your hardware being used to attack the chain. Worse, commodity hardware is easy to rent or steal (with malware) to attack a chain.
So the entire bitcoin community would have to change their opinion on how to make a chain secure to a worse opinion.
It's also important to understand the security is a huge limiting factor on price. If the benefit from causing a double spend exceeds the cost of doing a double spend, there will be double spends. Nobody wants that. So market forces will act to keep the benefit of a double spend below the cost of a double spend.
ASIC-resistant algorithms have much lower cost to do double spends (because you don't need to invest in ASICs but can instead rent or hack commodity hardware) so the profit from a double spend must necessarily be much lower. That will mean either waiting for many more confirmations, dropping the price of bitcoin, or some of each. Who wants that?
answered Dec 15, 2019 at 2:01
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How is ASIC resistance weakening the security of the proof of work? Commented Dec 15, 2019 at 19:40
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2@toolforger Read what I wrote above. If a chain is not ASIC-resistant, you have to invest in ASICs to attack it, and then attacking it makes your ASICs worthless. If it's ASIC resistant, you can rent access to commodity hardware to attack it and you lose nothing in the attack. It's very hard to rent, borrow, or hack into someone's SHA256d ASICs to attack bitcoin because everyone knows that such an attack makes their expensive ASICs less valuable. You can rent, borrow, or hack CPU time easily. Commented Dec 15, 2019 at 20:58
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If commodity hardware is useful for mining, then a malicious miner has to outmine a much larger normal user base. Given that I haven't heard of any attacks against ASIC-resistant blockchains, and assuming that such blockchains already do exist and are worth an attack, it seems to me that this outweighs the ability to attack. Commented Dec 16, 2019 at 5:15
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1@toolforger there have been many attacks against ASIC-resistant chains, cost of ASICs does seem to be a larger factor than ‘a much larger normal userbase’. See: vertcoin, eth classic, verge, etc. In any case, ASIC-resistance leads to more centralization of hashing power, as it is impossible to create an algorithm which is most efficient to mine on commodity hardware. It will always be possible to create optimizations in the hardware, ASIC-resistance just makes it harder to do (which means, less people are capable of doing it = more centralization of mining power). It’s bad all around.– chytrikCommented Dec 18, 2019 at 21:49
Agree with David's answer, but the security detriments of ASIC resistance (of which there are many) is somewhat besides the point.
The entire value proposition of bitcoin, and what makes it so valuable above all other coins, is that it cannot be controlled by humans. If such a large change were to be made, the chain would not be considered "bitcoin" by current miners (who mine with ASICS and thus have everything to lose) nor the community (who recognize the importance of protocol stability).
answered Jun 22, 2021 at 17:46
I essentially disagree with David Schwartz here. The aim of bitcoin was decentralisation, and never high prices. And to say commodity hardware promotes the idea of attacking the chain is simply ridiculous. Why will anyone who has the ability to bring so much malicious hardware together, will ever use it to make all his bitcoin useless? Since compound interest is obviously better than a one time cash out. So do we want decentralisation or higher prices is essentially the question. Do we give power to centralisation of ASICs and forget decentralisation, or actually go back to the roots of the problem. Can hear anyone's suggestion on this one.
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1"Why will anyone who has the ability to bring so much malicious hardware together, will ever use it to make all his bitcoin useless?" Yes, keyword is "short position" - if you can profit from making BTC worthless, then you suddenly have a completely different set of incentives. This is also a point against David's argument btw. If a 5B$ investment into hardware can move a 650B market downwards and you can profit from that, then you don't really care if you sell your hardware to the second market later. All these arguments about how safe BTC is, work only for miners with a long position. Commented Jun 22, 2021 at 6:23
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Why would an entity choose a one time cash out of bitcoin after investing so much money into the hardware, in effect making the recurrent income possibility of bitcoin mining essentially 0? Commented Jun 22, 2021 at 7:26
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Because if you know you could do it, then you know that someone else could do it and there goes your recurrent income possibility. Commented Jun 22, 2021 at 8:24
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This answer seems to be mostly based on the assertion that ASIC-resistance would lead to a more decentralized outcome in the long run. This assumption as well as the notion that decentralization is opposed to the Bitcoin network being economically successful are not clear to me and should be substantiated further.– Murch ♦Commented Jun 22, 2021 at 22:54