A cryptocurrency mining company, Obelisk, is going to change its code so that the devices of mining giant Bitmain cannot process one of its coins.
Obelisk vs monolith
Looking at its website, you will see that Obelisk was set up to create a “more secure, more future-proof networks for cryptocurrencies like Decred and Siacoin.” Basically, it sells cryptocurrency mining devices, ASICs, which are geared towards these two coins. The connection goes even further than that – Obelisk was actually created by the Siacoin team.
Siacoin has a market capitalisation of $187.5 million, according to coinmarketcap.com, so it is not a major currency. However its blockchain has a specific utility – it allows users to rent out their spare hard drive storage space to other users for payment (in Siacoin).
According to an email sent to customers, Boston-based Obelisk has now released a code which could exclude the ASIC miners of Bitmain from mining Siacoin.
The email details its plans regarding first shipments of its mining devices and payment to to miners. The interesting paragraph comes towards the end:
“Second, we will release the SC1 alternative Blake2b algorithm in the coming weeks. This will give the Sia community the ability to fork and could invalidate all non-Obelisk Siacoin ASIC miners on the forked chain.”
What is the problem exactly?
ASIC miners are specifically designed to mine cryptocurrency, and so far outperform standard computers in terms of this task.
Bitmain is a Hong Kong-based company that also manufactures the devices. Its position in the cryptocurrency system is seen by some to be problematic, because the dominance of its Bitcoin mining pools is monopolistic. It was also recently revealed that it is holding a very large percentage of all the Bitcoin Cash in the world too.
This last point can be considered worrying because people involved with Bitcoin Cash passionately believe that it is the ‘real’ Bitcoin, and actively want to replace the original cryptocurrency. The fact that the de facto controller of Bitcoin creation is apparently a fan of Bitcoin Cash is thus an issue.
So, when Bitmain released a device for mining Siacoin (the Antminer A3) in January, Zach Herbert, VP of Operations at Obelisk said: “We consider Bitmain a bad actor in the cryptocurrency space.”
However the decision was made at that time not to execute a fork. Herbert explained: “…we believe that [forking] before Bitmain has attacked our network would be a centralized, monopolistic move, rather than a proactive, protective measure… If Bitmain takes any action to harm the Sia project, we will soft-fork to invalidate their hardware.”
ATFX Q1 2020 Market Outlook Report: Weighing Geopolitical FactorsGo to article >>
Compare that with yesterday’s email: “As of today, all … Obelisk employees are supportive of a fork.”
Obelisk vs monolith
In May, Obelisk CEO David Vorick published an article in Medium called “The State of Cryptocurrency Mining” in which he accused Bitmain of cheating customers, playing ‘dirty’, and basically controlling the whole industry.
Bitmain responded, claiming that the article “reflects some persistent misunderstandings” and that it is sensitive to the communities in which it participates.
However Siacoin is not the only cryptocurrency to react in this way to a new Bitmain device. The Bitmain Antminer X3 model, released in May, is specifically designed to focus on a small number of cryptocurrencies including Monero. In August 2018, the team behind the cryptocurrency Monero said that it will be changing the coin’s code every six months in order to prevent these miners monopolising its creation.
Just a reminder that this WILL NOT work on Monero https://t.co/rhy6k2I4Yh
— Riccardo Spagni (@fluffypony) March 15, 2018
Monero was designed to be anonymous and easy to mine with a home computer.
Bitmain also announced the release of an Ethereum miner, the Antminer E3, in April.
We are pleased to announce the Antminer E3, world’s most powerful and efficient EtHash ASIC miner.
Ordering limit of one miner per user and not available in China.
Limited stock, order here now: https://t.co/Zfw3afjJHs#antminerE3 pic.twitter.com/SjHu2eUThp
— BITMAIN [Not giving away ETH] (@BITMAINtech) April 3, 2018
In May Business Insider reported that the machines, which cost $2,150 each, had already sold out.