Ethereum Mining Is facing A centralization Problem

CNBC Report

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The Ethereum Mining Changing Landscape

Rumors and mews have filled the crypto market in regard to the new ASIC mining rig which has emanated from Bitmain. This is a mining platform for just Ethereum.

CNBC report had as has been cited by TechCrunch, reports that the rumors came about at the time when Christopher Roland, an analyst made a visit to China and learned about the current Ethereum dedicated ASIC chip which is under development.

Rolland wrote;

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.

This news has been alarming in the cryptocurrency market due to the fact that this centralizes Ethereum mining. In the past, this has domination from the GPU. Incorporation of ASICs may be negative as they may create a barrier to entry and also eliminate the small miners.

The founder of Try Mining, Mikhail Avady says;

Ethereum is of the most profitable coins available for GPU mining. It’s going to affect a lot of the market. Without understanding the hash power of these Bitmain machines, we can’t tell if it will make GPUs obsolete or not. It can be seen as an attack on the network. It’s a centralization problem.

Keep Calm, Hodl Ethereum

According to Rolland’s report, TechCrunch also noted in the following claims;

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.

Avady also gave explanations that the future might not be centralized which is contrary to the naysayers. He said;

What would be bad is if there was only one Ethereum ASIC manufacturer, but with Samsung and a couple other players getting into the game it won’t be bad for long.

However, the concerns which are raised over the diminishing of Ethereum in the market as an ICO investment vehicle might end soon. According to Cypheriums CEO, Sky Guo;

The price of ETH is becoming consolidated as people become more realistic about Blockchain technology. People are looking for higher quality Blockchain projects. I believe a rebound in ETH’s price will come soon as panic surrounding regulations begins to fade.

 

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