Litecoin Developers on why they won’t be changing the scrypt algorithm

With dedicated Scrypt ASICs on the horizon, many of the Scrypt coins out there are calling for changes in their chosen coins’ algorithms. It’s a bid for mining with a GPU to remain feasible. Earlier today two members of the Litecoin development team took to the LitecoinTalk forums to express their reasoning behind not changing the coin’s algorithm.

The main reasoning given by Litecoin creator Charlie Lee is that hard-forking the coin is a dangerous thing to do when it comes to changing the algorithm, as well as the fact that there are no alternatives out there that are truly ASIC-resistant in the long run. The development team feels that there’s more chance of a hard-fork killing Litecoin than there is of ASICs killing it — making it a rather risky decision to take.

Lee reminds the community that Bitcoin actually benefited from ASICs in the end:

Please keep in mind that ASICs will not kill Litecoin. When ASICs came on the scene for Bitcoin, it helped strengthen the security of the network. It also forced every other SHA256d coin to be merged mined if it didn’t want to be destroyed by ASICs. And the Bitcoin price shot through the roof. It’s worth noting that multiple companies investing millions in Litecoin-specific hardware is a big sign that Litecoin has succeeded.

Whille X11 algorithm is the one being called for by many coin communities, a second Litecoin development team member added some details on why this isn’t a good idea from a technical standpoint:

X11 suffers from the problems stemming from increased propagation latency and slow verification, and adds even worse susceptibility to ASIC advantage. It is a mere mishmash of 11 separate algorithms that are now GPU mineable (according to Darkcoin’s homepage). Anything GPU mineable can be implemented in custom hardware. To make matters worse, ASIC’s could even have a major speedup advantage over GPU’s. adam3mus said, “it does seem likely that eg if the unused space due to heat can be filled with the other hashes, then it can all be pipelined together and no slowdown. the only cost is replicating different hash functions which doesnt seem particularly hard”

So a switch to X11 only delays the inevitable. Switching the hash to X11 would only spite the current manufacturers while ultimately failing in the goal of preventing ASIC’s later. It gets even worse. If the cost of entry for a particular PoW is very high by design, that increases the chance of fewer competing manufacturers entering a market. This is the worst possible outcome for any Bitcoin-like network that relies upon large quantities of greedy miners to outdo each other to maintain network security.

The debate around algorithms will likely continue on around many of the altcoins, especially as we get ever closer to ASICs being in the hands of miners. This reasoning from the Litecoin developers is certainly something to take on board before screaming for changes, though.

You can read the very detailed postings from the Litecoin developers in full over here.