It wasn’t long ago that graphic processing units (GPUs) were the superstars of the blockchain world. These small(ish) add-ons could turn a run of the mill PC into a crypto-mining powerhouse. Prices skyrocketed, gamers--who also like to use GPUs--cried it wasn't fair and manufacturers of the chips gave themselves endless high-fives. And then the prices crashed.
Since the heady days of January 2018, miners have been abandoning GPUs thanks to declines in profitability, and the increasing popularity of ASIC miners, a more specialised type of miner better suited to currencies like bitcoin. But things are looking up for discarded GPUs. Golem, the peer-to-peer (P2P) distributed computing platform, wants to put redundant GPUs back to work. Today it launches the GPU version of its decentralized computing power marketplace. But this is one company that takes care not to raise expectations.
“In crypto, people tend to use a lot of processing—basically---for proof of work,” says Golem’s founder, Julian Zawistowski, speaking on the sidelines of the Web3 Summit in Berlin, on Monday.
“That means we have a lot of GPUs around. Probably, at the moment, mining crypto with your GPU is still a better option than running it on Golem, but, on the other hand, as cryptocurrencies, blockchain projects and--particularly--Ethereum move to Proof of Stake, then all those GPUs will be unemployed.”
There is indeed a growing belief in the industry that, one day, sooner rather than later, (depending on who you listen to) mining could be avoided altogether. Those looking for a complete shift generally favor Proof of Stake (PoS) as an alternative consensus mechanism that does away with mining. Despite this method’s many shortcomings, Ethereum is working hard to achieve a version of Proof of Stake that works.
Until that day, Zawistowski and his colleagues continue to tinker with their vision of one day challenging the cloud computing giants Google, Microsoft and Amazon and IBM. But their ambitions weren't always so big.
Zawistowski is a graduate of the Warsaw School of Economics, and worked at the national bank of Poland before entrepreneurship beckoned. He came up with the idea for Golem in 2014.
“We started thinking of Golem purely to increase the efficiency of the market, but now I think of other, more philosophical and technical consequences, of what we want to do, which is control what happens in the cloud,” says Zawistowski.
The growing popularity of cloud storage and computing has led to much interest in ‘virtual super computers’ that rely on the collective power of the network. Models of distributed computing to solve problems existed before blockchain technology popped up. But these projects, for example SETI@home and BOINC, have tended to be academic in nature, with participants donating their computing time for causes they feel deserve support. Whereas Golem enables contributors to be rewarded for their participation.
But, when the going gets tough, what would stop the big players from undercutting Golem, and offering their computing power for even less?
“You can look at that as a race to the bottom,” says Zawistowski. “No matter what the big guy does, they always have to pay the computing costs… There are many different aspects of the economic system. You may not be able to beat them at everything, but maybe you will be able to beat them in some aspects of it.”
Golem is still in its initial phases, so its impact on the market is yet to emerge. It raised US$8.6 million in just 29 minutes during its November 2016 token sale but it has also been criticised for the cautious pace the development team has adopted.
“We are--maybe--not as fast as we would love to be,” says Zawistowski. “There are a number of things that will be the next big step but it’s always hard to give exact dates, and we’ve been burnt before—not only Golem, but the whole crypto space—by giving predictions that are too exact.”
Zawistowski also wants to make sure that no one is under the illusion that, just because they are adding GPUs to their roster, the market will explode. They are still mainly focused on batch processing, he points out. GPU capability “is just the next step towards more generalized, versatile computing.”
As GPUs are replaced by components like ASICs for mining, Golem’s plan means that it may well continue to be profitable to use them for a different, albeit blockchain-related, network. Nvidia, one of the primary manufacturers of GPUs, agrees. Talking to CNBC’s Fast Money recently, Nvidia’s founder Jensen Huang said the company’s GPU “serves as the perfect processor to enable this supercomputing capability to be distributed”.
For blockchain and its aficionados, the GPU, it seems, is the chip that keeps on giving, and Golem the blockchain that wants to keep it that way.