This September marks a major milestone in the crypto space as Ethereum’s Merge happens that will change the entire consensus model. The Merge is the term used to describe Ethereum’s transition from using the energy-intensive Proof-of-Work (PoW) consensus to the more efficient Proof-of-Stake (PoS). It’s the second major deliverable in a larger plan to make Ethereum more scalable, efficient, and cost-effective. So one The Merge is completed, how will it affect cryptocurrencies that use Proof of Work?
Responding to Cointelegraph on this matter, Andy Long, CEO at White Rock Management said: “As GPU miners point their hardware at other chains their difficulty will increase causing lower returns and splitting the reward amongst more miners”. That means Ethereum’s transition from PoW to PoS could force many ETH miners to shut down and cause severe disruption to all PoW coins.
The transition can even force many miners to give up and abandon their expensive mining rigs, Andy Long added. They have to sell off GPU hardware or high-performance computing (HPC) services that are used for mining.
GPU prices have already been declining as Bitcoin plummets during crypto winter. If The Merge is successful, GPU price could drop even more. Regardless of what happens after the Merge, Andy Long said he is not “strongly opposed” and want to see how the market plays out.
Since starting to build GPU farms in 2017, Andy Long has known Ethereum Merge will be a threat and have a major impact on the mining industry.
“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 move from PoW to PoS on September 15, and it is considered one of the most important upgrades in the crypto market this year. However, there are still many cryptocurrencies that continue to use PoW such as Bitcoin (BTC), Litecoin (LTC), Bitcoin Cash (BCH), Ethereum Classic (ETC), Monero (XMR), Zcash (ZEC), Ravencoin (RVN), and more.
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