Earlier this week, Chinese cryptocurrency hardware startup Linzhi announced that it was in the process of testing new machines designed to dramatically improve Ethereum and Ethereum Classic mining. The Shenzhen-based firm, founded last year by former Canaan Creative chip designer Chen Min, ordered a reported 37 wafers of Ethash-optimized application-specific integrated circuit (ASIC) chips, which will be used to create around 200 prototype mining units. According to an update posted on the company’s website, prototype testing is expected to be complete by late November.
Linzhi claims that the mining units will be able to achieve a performance of 1400 MH/s while only drawing around 1 kWh of electricity, a substantial improvement over the 650 MH/s at 2.1 kWh average seen in typical GPU-based Ethereum mining setups. While these numbers may seem humble when compared to the 50 TH/s speeds of current-generation bitcoin miners, Ethereum’s proof-of-work (PoW) algorithms are specifically designed to discourage large-scale centralized mining operations. During the testing phase, the Linzhi miners are expected to add around 300 GH/s to the Ethereum and Ethereum Classic blockchains. (For context, the Ethereum network currently has a total hashrate of around 180 TH/s, while its rival blockchain fork Ethereum Classic runs at roughly 11 TH/s.)
In their update, Linzhi also addressed concerns about the Ethereum community’s long-term plan to move away from PoW model, replacing it with the ASIC-resistant Programmatic Proof of Work (ProgPoW) algorithm. “When sales of our machines start, we will advise customers on all likely and ongoing efforts to change PoW algos in Ethash coins,” the company said, adding that it has not accepted pre-orders for this very reason. The Ethereum roadmap also calls for the PoW model to be replaced with a proof-of-stake (PoS) system that would remove the need for mining, although Ethereum Classic mining would remain unchanged.
Linzhi says it is pricing its new miners at a 4-month ROI, slightly cheaper than the “150–200 day paybacks” seen in high-volume bitcoin miner sales. Interestingly, the company said it was considering a “reverse discount” — increasing the per-unit price for large orders — to incentivize greater geographical distribution. “This will offset some of the cost advantages that larger customers have and encourage decentralization,” the company said.