ViaBTC | Interview with the ViaBTC Team: The Crypto Industry and the Future of PoW Mining
ViaBTC is celebrating its seventh anniversary and has kicked off the “Ready for More” anniversary party in June 2023. As one of the world’s top cryptocurrency mining pools, ViaBTC provides secure, stable, and efficient one-stop mining services for millions of users in over 130 countries and regions, with a cumulative mining output value of tens of billions of dollars. Recently, ViaBTC also introduced the KAS pool and initiated a one-month zero fee program.
We interviewed the ViaBTC team and got about their views on the crypto industry, PoW mining, and the future of ViaBTC.
Congratulations on your seventh anniversary. You’ve been a top pool by hashrate since day one, and it’s quite rare for a top player to maintain such an excellent growth record. From your perspective, what are the main factors that help a pool maintain stable and growing hashrates?
When it comes to product and technology, the crypto industry can be very demanding. In other more casual areas, such as social platforms or video websites, temporary bugs or technical glitches may not bring significant losses to users. However, in the crypto space, a platform’s security and stability are closely tied to user assets, and a failure can potentially lead to real losses for users. That’s why we have always said that security should be given the utmost priority, as it is a matter of life and death in the crypto industry.
It has been nearly 13 years since the birth of the world’s first mining pool in 2010, and ViaBTC has witnessed seven years of ups and downs in the industry. We are aware that over the years, many of our peers have made different attempts in this field, but the ultimate goal of mining pool services is to bring miners stable and handsome returns. Therefore, we believe that technical stability and security underpin the survival of a pool. ViaBTC has built globally distributed high-speed block updating networks to reduce the orphan rate, and we still offer the lowest orphan rate in the industry. For instance, our recently launched KAS pool has maintained a 0% rejection rate since its launch, with stable network connections.
Furthermore, we believe that mining pools should provide convenient facilities for miners to expand their earnings. ViaBTC now offers derivative tools such as Hedging Service and Crypto Loans. With Auto Conversion supported, the pool distributes the mining revenues on an hourly basis. Moreover, on our platform, miners get to withdraw their revenue to CoinEx with zero fees and real-time arrival, which helps them minimize the impact of market volatility.
We believe that these two factors explain, to a large extent, why ViaBTC has gained support from the miner community and why ViaBTC has been able to rank top by hashrates in this ever-changing industry for seven years.
Last year, the Merge was a big crypto event. Following Ethereum’s transition from PoW to PoS, many have been skeptical about the future of PoW. How do you view this matter? Does PoW mining still have a future?
Currently, Bitcoin, the best-known and the biggest iconic crypto in the industry, still uses the PoW mechanism and will continue to leverage PoW in the future. Additionally, cryptos like DOGE and LTC, which rank high in market cap, are still mined through PoW. As such, for a long time to come, PoW cannot be replaced and will not suddenly disappear.
The crypto industry has always been a level playing field for various entities, without absolute monopoly, which holds true in both the public chain category and the blockchain application market. This ecosystem is actually a plus for market development and conforms to the principles of blockchain. We have had the debate on whether PoS or PoW is better for a long time, but the market has yet to reach a consensus on the optimal solution. Users and the industry require an efficient, secure, and decentralized platform, and many people don’t really care whether it is based on PoW or PoS.
The blockchain trilemma of efficiency, scalability, and decentralization is notoriously challenging, leaving many public chains no choice but to make trade-offs. Cryptos like BTC and LTC, which do not require extensive application demands, choose PoW as it is a more secure option. Their goal is simply to become a peer-to-peer electronic cash system that meets everyday payment needs. Ethereum, on the other hand, carries the mission of becoming the “world computer”, and it can offer a higher TPS with the help of PoS.
We still endorse the view that PoW will not be completely replaced, and PoW mining will not disappear. The two consensus mechanisms have their own suitable applications, and it is not difficult for PoW and PoS to coexist. We look forward to a diversified blockchain future.
Ethereum has transitioned to PoS, and we heard that the Dogecoin community is also discussing the possibility of switching to PoS. Will these events harm miners’ confidence in PoW mining?
Some Ethereum miners may have left after the Merge, but according to the statistics, the impact of the Merge on miners has now diminished.
During the Merge last year, the total Bitcoin hashrate was about 200 EH/s, and the current figure is approaching 400 EH/s, which has almost doubled. This shows that Bitcoin miners’ confidence has not been compromised by the Merge, and the hashrate has grown at a steady pace.
Additionally, Ethereum miners generally adopt GPU. Before the Merge, Ethereum had a total hashrate of about 850 TH/s, and during the Merge, ETC’s hashrate jumped from about 50 TH/s to 150 TH/s. Other public chains supporting GPU mining also saw a small increase in hashrate, but most of the hashrate was lost. At the time, it was estimated that many GPU miners might have exited the mining market.
However, it was also during the second half of 2022 that Kaspa recorded significant hashrate growth. Back in June 2022, the KAS hashrate was modest, but by December, the figure had reached 440 TH/s. This April, the peak hashrate of KAS exceeded 1.1 PH/s, far surpassing the ETH hashrate before the Merge. These figures demonstrate the confidence of miners. Many GPU miners did not really leave during the Merge; they were just observing and will return when the market presents cryptos they favor.
Consensus mechanisms and decentralization have always captured the crypto spotlight. PoW has been criticized for its efficiency issues, and this year the Ordinals protocol even congested the Bitcoin network. Is it still possible for PoW to foster large-scale applications?
Decentralization is at the heart of crypto, and if decentralization is completely sacrificed, then the so-called cryptos would not be much different from many Web2 products. This is why decentralization has always been a hot topic of discussion in the crypto industry.
The criticism of PoW’s efficiency and scalability is rooted in the fact that smart contracts were not considered when cryptos like BTC and LTC were designed. However, many PoW cryptos are now exploring smart contracts. For example, we recently launched a KAS pool, and the team behind the crypto has mentioned in its roadmap that it will support Layer 2, smart contract, and DeFi development in the future.
Both the innovative Ordinals protocol and the more scalable KAS are bold attempts by PoW projects. Perhaps, other PoW public chains will draw on their experience to propose better designs and underlying technology architecture to offer chains that are more efficient and scalable, while preserving the spirit of decentralization upheld by Bitcoin.
PoW does not completely exclude the possibility of applications. Ethereum transitioned to PoS only for the convenience of future upgrades, and PoS itself did not improve the efficiency of Ethereum. For the Ethereum network, efficiency improvements rely on the subsequent Danksharding and Layer 2. If PoW chains achieve technological breakthroughs, then PoW might also foster large-scale applications.
Could you tell us more about your future roadmap?
We have prioritized the interest of miners and the user community since day one. On one hand, we strive to provide stable and decent mining revenue for miners, and on the other hand, we maintain the Bitcoin network by operating a stable mining pool.
In the future, ViaBTC will continue to focus on these two priorities. Meanwhile, to provide better mining services, we will keep perfecting our product experiences and improve the underlying infrastructure to offer a secure, efficient, and stable mining network.
Additionally, ViaBTC will also fulfill its responsibilities and drive industry progress. We will keep close track of the development of PoW chains and provide quality mining services spanning multiple cryptos while adapting to the latest market movements and maintaining the security of public chain networks. Furthermore, we will continue to build a global presence to reach miners in different regions and pursue the geographical diversity of our hashrate distribution, making the blockchain world more decentralized and freer.
As one of the blockchain companies with the most extensive business scope, we will strengthen the connections between different products of ViaBTC Group and offer all-in-one ecosystem services covering ViaBTC Pool, ViaWallet, and CoinEx Exchange. We strive to provide secure, stable, efficient, and reliable blockchain infrastructure, making it easier for more global users to join the industry.
