Cofounder of ASIC-maker Obelisk on the state of PoW mining: challenges of ASIC-resistant hard forks, many new coins are optimized for secret ASIC designs, more
For those new to the blog, I am the lead developer of Sia, a blockchain based cloud storage platform.
Context & Ripple Effects
The Obelisk cofounder's assessment lands a month after Monero's hard fork against ASIC mining produced four new ASIC-compatible Monero projects instead of a clean exit from specialized hardware — evidence for his core claim that ASIC-resistant hard forks face significant challenges. His second point cuts the other way: rather than fighting ASICs, many new coins now optimize their algorithms for secret ASIC designs, giving whoever holds the chip an edge nobody else can see.
That dynamic matters because the supply side is concentrated: Bitmain alone controls roughly 29% of Bitcoin's hash rate and dominates rig sales alongside Canaan Creative, while Samsung's confirmed entry into ASIC manufacturing shows foundries see mining silicon as a growth line. An insider who designs both the coin's algorithm and its chip sits at the intersection of those two powers.
First-order effects
- Coin developers choosing proof-of-work parameters now face a fork dilemma: resist ASICs and risk repeated contentious hard forks like Monero's, or accept them and hand early advantage to whichever manufacturer built chips in secret.
- Miners buying rigs from Bitmain or Canaan must price in the possibility that a coin's algorithm was tuned for hardware they cannot purchase yet.
Second-order effects
- Secret-ASIC-optimized launches push more hash power toward vertically integrated players who control both design and fabrication, reinforcing the Bitmain-Canaan duopoly even as entrants like Samsung widen the foundry pool.
- Communities burned by covert mining advantages will demand open ASIC development or algorithm changes, making hard-fork governance a recurring cost for any PoW project that scales.
Third-order effects
- If the pattern holds, proof-of-work security splits into two camps — networks with openly specified hardware and networks whose mining economics are opaque by design — turning chip disclosure into a trust question for every new coin.
- The longer arc points toward mining silicon becoming a strategic input like any other workload-specific chip business, where a handful of designers and foundries set terms for entire blockchain ecosystems.
The trend: Proof-of-work mining is settling into an arms race between protocol communities trying to stay ASIC-neutral and silicon makers embedding hidden advantages into coin algorithms.