The Ethereum network’s transition from a proof-of-work (PoW) consensus is likely to flood the crypto industry with out-of-work ETH miners, causing major disruption to all PoW tokens.
Speaking to Cointelegraph, Andy Long, CEO of Bitcoin miner White Rock believes that the upcoming Ethereum merger will force PoW miners to look for greener pastures, just like other PoW blockchains, and thus “swamp” other coins — increasing mining difficulty and reducing profitability, stating:
“As GPU miners point their hardware at other chains their difficulty will increase causing lower returns and splitting the reward amongst more miners.”
“Hashrate will flow to alternative GPU PoW coins, and many miners will simply give up and try to sell off their farms of cards,” he said, added “Some miners will try to sell their High-Performance Computing (HPC) or GPU cloud services and will likely fail since there’s too much capacity chasing a limited amount of demand.”
Prices and demand for GPUs are falling due to the drop in the price of Bitcoin (BTC), which is causing some cards to sell below list prices and vendors trying to offload their mining rigs and cards at inflated prices.
Whatever happens after the Merge, Long says he is “not strongly opposed” and is interested to see “how market forces play out.”
“When I was building GPU farms in 2017 the Merge was cited as an imminent threat and would have been much more impactful then.”
“There will always be GPUs mining some GPU optimized chains, but I doubt we will return to the levels of revenue seen in ETH proof-of-work at its peak ever again.”
Ethereum is expected to switch to a proof-of-stake (PoS) mechanism between September 10-20, marking one of the most significant upgrades in the crypto market this year.
However, some cryptocurrencies including Bitcoin (BTC), Litecoin (LTC), and Bitcoin Cash (BCH), as well as Ethereum Classic (ETC), Monero (XMR), Zcash (ZEC), and Ravencoin (RVN) have not yet reached their PoW. Direction.
White Rock Management is a Swiss digital asset technology company that mines cryptocurrencies through data centers in Texas and Sweden.
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