How To Stop Ether Going To Zero: Defusing The ‘Difficultly Bomb’

Ethereum and its community has a problem on top of a problem. The first problem is that, by the end of the year, it’ll need to find a solution to the so-called Difficulty Bomb: the level of difficulty of the puzzles miners have to solve in order to be rewarded for mining ether on the Ethereum blockchain is increasing. As the puzzles become more complicated, with miners finding it more difficult to earn ether, a lag grows between the production of blocks on the blockchain. This may prompt the scenario that, in early 2019, mining becomes unprofitable. And this means there are two choices: either to improve Proof of Work for Ethereum (learning from Bitcoin), or to change to Proof of Stake.

The problem on top of this is that there is no guaranteed way forward when it comes to solving the Difficulty Bomb. There are several possible routes and, by the end of this year, some of them will have been implemented. But we won’t know which one is the winning strategy, and that brings…