The POW Rebellion
After Decred reduced the mining reward to 10% per block there was always going to be some fallout. But the question should be, Is this the start of a trend that moves away from POW? and what can miners do to prevent more projects exiting the Proof of work economy?
The following video demonstrates how to mine on the Decred blockchain and how the recent block reward change is likely to impact the project and the miners.
Sad to see a project moving away from PoW, but that is what happens when miners don't support the project. It's a reoccurring theme...because we kinda live in an era where way too many miners are acting like leeches. These industrialized mining farms are cash businesses with cash backers that don't give a **** about the coin. They want to make a bunch of money and that's kinda it.
Decred is the first but unlikely to be the last
Decred is not the only blockchain suffering from miners not caring about the project and using its large mined coin reserves to exert influence and extract large amounts of profit, at the expense of the project.
The start of a trend that moves away from POW?
Looking at projects like Decred, Ethereum and ZCash, it would suggest that there is a movement away from POW mining as the preferred security mechanism. It’s widely understood that ASIC mining has becoming massively centralised. And any project outside of Bitcoin BTC is unlikely to have long-term security without implementing at least one additional layer of security, e.g. chain locks or a Proof of stake (POS) layer.
What can miners do to prevent more projects exiting the Proof of work economy?
Cleaning up their act might be a good starting point. ASIC manufacturing could be more diverse, with new machines easier to purchase. ASIC manufacturers could also offer better after sales support for their machines. Individual miners could join or start a new pool with a smaller percentage of the hash rate. And ultimately show more conviction for the projects they're mining.
It would be easy for a miner to reject these suggestions under the guise of needing to pay bills and recoup expenses, but this is the same reason projects are starting to question the effectiveness of miners. Low conviction = Low security.
A more common approach / response to this question is for miners to publicly criticise, belittle a project trying to move away from pure proof of work. Berating a project with phrases like:
- “It’s an old project, that has no use cases”
- “You can tell from the price that it's under performing”
- “I don’t really follow the project cos it's boring and doesn’t honestly do anything”
- “Its big feature is … but no one really cares about that any more”
“Its big feature is … but all these new projects are doing it so much better”
It always amuses me when they call a six-year-old project, OLD. This stems from current culture’s perception of new being better and is used as a derogative term to play on those emotions, which of-course is pure nonsense in a technical debate. This is why we have upgrades!
This argument also never refers to or references the development milestones or the fact that developing takes time. A six-year-old project hasn’t even finished its first development cycle. And suggesting a six-month-old project is likely to be better plays to the casino crowd. When, in truth, said project is likely to either have been copied from another project or is an unbuilt concept that has published a coin to fund-raise.
As I always say, if you want to see how a project is performing, look at the block explorer and investigate the open-source development logs. This stuff takes time, and the mission should be to fix problems. Ultimately, the biggest concerns in blockchain normally revolves around centralisation. This is why I Decred!
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Disclaimer — Please note the above research is not financial advice and you should always do your own due diligence before investing your money. Investments can go down as well as up and cryptocurrencies are typically volatile assets.
The views expressed in this article are that of the author and based on the authors own research and investigation. The author is happy to receive comments, feedback and suggested edits for this channel to help evolve the open nature of the discussion.