Bitcoin’s (BTC) detractors are playing up the energy-intensive criticism of the network’s proof-of-work (PoW) consensus, which is considered to be anti-green. While the Zcash project (ZEC) has been quite content to copy this process from Bitcoin, its leaders now seem to be giving in to the sirens of proof-of-stake (PoS).
ASICs distorting the game of open mining
The fashion in cryptocurrencies is for less energy-intensive consensus than the proof-of-work validation popularized by Bitcoin. The Zcash project, known for its transactions with an anonymization option, is no exception.
That’s the conclusion of a recent publication by Zooko Wilcox, current CEO of the Electric Coin Company (ECC), which leads the development of the Zcash network. In it, he lays out an initial observation that is true. Since its inception in October 2016 – and as with many other PoW cryptos – Zcash mining has unfortunately drifted away from standard computer owners.
“Zcash has been in PoW since its inception, which has allowed for wide distribution of ZEC to the 4 corners of the world. Originally, it was possible for GPU [graphics card] owners to mine new ZEC, but in 2018, Bitmain released specialized miners (ASICs) for Zcash’s algorithm, which made GPU mining obsolete.”Zooko Wilcox
Proof of stake to remedy ASICs
It would not be the first time that a blockchain community finds itself having to fight the privilege of ASICs (Monero in particular has done it several times) to restore a bit of balance with GPU miners. It seems, however, that this is no longer the case for those gathered around Zcash, according to the ECC leader:
“The Zcash Foundation has been having conversations with the community, which prefers not to take the option of changes that would make the protocol more resistant to ASICs. Today, we believe that almost all Zcash mining is done with ASIC miners. (…) Moving to PoS would eliminate selling pressure on the ZEC price and add additional utility to ZEC.”
Effectively, instead of reselling freshly mined ZECs through PoW – at least to pay off the electrical costs, ZEC owners in PoS would be more likely to keep them. This is because the staking rewards get bigger and bigger if you keep these tokens.
Zooko Wilcox ends his message by explaining that he’s “looking forward” to hearing from ZEC owners, and the crypto community in general, on the topic of moving the Zcash network from PoW to PoS. Is this a greenwashing announcement or a sincere desire for evolution? In any case, some projects, like Ethereum, have already made this choice for a while. And it is clear that staking on the ETH 2.0 network is already attracting many.