For a long time, DogeHouse was one the biggest mining pools in the Dogecoin network, dedicated to solely mining Dogecoin. The pool officially shut down on April 7, 2014. In the light of the recent unrest in the Dogecoin community concerning a drop in mining activity and total network hashrate, this may have been one of the defining moments that led to the current situation.
Although it cannot be determined whether DogeHouse would have been able to retain its hashrate otherwise, the moment has been a catalyst to the reduction of the number of dedicated miners in the network. The changes in the number of blocks mined by the biggest mining pools in the Dogecoin network around the time of DogeHouse’s demise are shown below:
The data has been distributed over 500 block intervals. 500 blocks corresponds to roughly nine hours. The graph includes only the pools that show a strong move along with DogeHouse’s fall. Multipool, Dogechain and other miners show a stable trend over the period. This leaves CleverMining and WafflePool.
It can be observed that most of DogeHouse’s hashrate ended up at WafflePool, after initially moving towards Clevermining. WafflePool is a multi-coin switching mining pool, which tries to take advantage of coins with low difficulties with respect to their hashrate. As it joins the network only when it is profitable to do so, it doesn’t really contribute to its security. This confirms that the disappearance of DogeHouse suddenly deteriorated Dogecoin’s network’s strength. DogeHouse was rebooted under the same name shortly after, but an examination of the most recent Dogecoin halving at a later data already revealed that it does not play a significant role at all anymore.
Difficulty and conclusion
Another point that further strengthens the previous conclusion is that the network’s difficulty remained stable even though it was losing one of its biggest mining pools. This makes it more likely that miners transferred their hashing power to another pool in the network. The following graph shows the development of the network difficulty during this period:
To conclude, there seems to be firm evidence that Wafflepool took in many of the once dedicated Dogecoin miners. In the long run this may not have mattered, but it has certainly contributed to the current crisis surrounding the future of Dogecoin mining.