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Blockchain: The Etherium Merge has Shipped and GPU prices are Dropping
Last week, September 15th, marked the completion of the Etherium cryptocoin’s ‘Merge‘. Etherium has migrated from a Proof-of-Work model to a Proof-of-Stake model.
With ‘Proof-of-Work’, Etherium ‘miners’ needed to use massive amounts of computer cycles to derive new Etherium coins. It is estimated that Etherium Proof-of-Work mining consumes 83.80 TWh per year—about as much power as Finland uses. The bigger and more powerful the computer there used to do the mining, the greater the number of coins that could be produced. ‘Proof-of-Stake’ allow existing owners of coins to pledge the coins they own when validating transactions.
The move to Proof-of-Stake was done to eliminate the massive amounts of computing power required by Proof-of-Work. A side effect of this change is that miners will no longer have a need for the high-power GPUs used for Etherium mining. Many of these miners may simply move on to other cryptocoins which still use Proof-of-Work, but others are in a position now to dump their GPUs. Some studies show though that the costs of mining no longer make it a very attractive option. As a result, the price of GPUs are expected to drop significantly.
Ben Gagnon of bitcoin miner Bitfarms, said that “GPU mining is dead less than 24 hours after the Merge. The only coins showing profit have no market cap or liquidity. The profit is not real.”
