Navigating mining options for the Ethereum Classic SHA-3 fork

This article is a synopsis of the whitepaper, SHA-3: Impact on Ethereum Classic Mining Hardware & Network Security posted on ePIC Blockchain’s Github.

The Ethereum Classic (ETC) community has been embroiled in a proposed Proof of Work (PoW) change to increase network security. ETC was attacked twice in January of 2019. To bolster the security of the ETC network, the ECIP 1049 proposal, initiated by Alex Tsankov, advocates changing ETC’s PoW algorithm to SHA-3 (also interchangeably referred to as Keccak). Significant effort has been devoted to testing with SHA-3 on, the testnet for Ethereum Classic.

ECIP 1049 will create new ways to interact with the blockchain while also improving its integrity and security. Becoming the largest blockchain on the SHA-3 algorithm greatly reduces the chance of bad actors attacking the ETC network while fostering a whole new generation of mining hardware development and innovation.

SHA-3 is hardware agnostic

While the change significantly improves network security, there were concerns from the community that dedicated ASIC hardware would not be ready for the Block 11.5 million hard fork to the SHA-3 PoW. These concerns are unfounded since SHA-3 is hardware agnostic and will run on today’s GPUs and FPGAs (Field Programmable Gate Arrays) until SHA-3 ASICs come online.

In other words, a fork to SHA-3 would be an easy transition for current GPUs mining on the ETC network.

The proposal would not only increase the hardware options for miners but allow ETC to be the dominant mining network on the SHA-3 algorithm, unlike ETC on Ethash today. Increasing the hashrate makes a network more difficult to attack. An attack requires many devices to be amassed. Renting hardware may be an option, but the high cost of rental makes this an unlikely option.

Other networks have successfully used a similar strategy, that is staying hardware agnostic, for their PoW algorithm. As an example, Grin coin, which uses the Cuckatoo 31 and 32 algorithms, is being mined with GPUs, while ASICs are being developed. However like Ethash, Cuckatoo is memory bound and therefore not conducive to FPGA mining.

Abundant FPGA support for SHA-3

The fork to SHA-3 would attract significant interest from FPGA miners. With over $70 million of mining rewards, ETC would represent the largest network that is profitable to mine with FPGA devices.

Various FPGA miners available from

Network security increases with FPGAs

While FPGA miners are nomadic in nature, constantly moving to the most profitable network, they are unlikely to amass enough hashrate to attack the ETC SHA-3 network. By my estimates, it would cost over $1 million per day to rent enough FPGAs from AWS F1 to mount a 51% attack on ETC network when it is being secured by 800,000 GPUs and 15,000 FPGAs. Alternatively, it would take 1.5 million GPUs to amass such an attack. (The numbers used in this post is based on a conservative ETC price of $7.85; ETC is currently trading around $12. Therefore, this allows for some interchange among the miner base between GPU and FPGA based on profitability.)

The ASICs are coming

Relative characteristics of SHA-3 mining hardware. Source: ePIC SHA-3 whitepaper

As SHA-3 ASICs come online on the ETC network, the security of the network will be greatly enhanced. ASIC hash rates are expected to be 7 to 400 times the hashrate of current FPGAs and GPUs. The huge increase in hashrate essentially removes the threat of a 51% GPU attack. ASIC miners by their nature are dedicated machines devoted to a single algorithm like SHA-3 and therefore have no motivation to attack their primary network. An attack would jeopardize the future profitability of one’s ASIC mining hardware.

Detractors of ECIP 1049 are attempting to derail adoption of SHA-3 by asserting that SHA-3 ASICs are difficult to design and implement. The fact is, the design is simple. There are many SHA-3 ASIC design papers published and several open source designs are available as a starting point. By comparison, there are no open source Ethash ASICs or FPGA bitstreams. The naysayers are Ethash ASIC manufacturers who have a vested interest in preventing ETC’s hard fork, since their ASICs are unable to mine SHA-3.

SHA-3 Activation Plan

Summary & call to action

Be ready for the SHA-3 transition by October 2020.

Further discussion on network security, network hashrates and SHA-3 hardware can be found in a whitepaper on ePIC’s Github, SHA-3 Transition Whitepaper: Impact on Ethereum Classic Mining Hardware & Network Security. The data and rationale used in this post is explained in more detail in the whitepaper.

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