Ethereum Merge , the long-awaited switch from PoW to PoS , is scheduled to take place in September. This change means that graphics cards will no longer be used for Ethereum mining, it will be switched to another mechanism. But believe it or not, the price of graphics cards could go up again.
Note that Ethereum has been preparing for this change from proof of work to proof of participation for years. The change makes the transaction and block validation process require much less computing power. So graphics cards will no longer be needed to perform this complex mathematical process.
What they don’t tell you about Ethereum Merge
There is a lot of talk that when the change from PoW to PoS is finalized, the price of Ethereum will go up . Another effect, since graphics cards are not required, is that many of them reach the second-hand market and the new ones go down in price as they have no outlet. But of course, this is the scenario (we can say) optimistic and that everyone takes for granted.
There is an equally likely scenario and that is that there is a distribution effect of mining. What does this mean? You may only know about Ethereum mining, but there are a number of other proof-of-work cryptocurrencies out there. Not all of them are friendly with graphics cards, as is the case with Bitcoin, Litecoin or Monero, but there are many others that are.
Ravencoin, ERGO, Ethereum Classic, Beam, Zano and a few more are friendly to graphics card mining. Currently it has less profitability than Ethereum, but an expansion phenomenon can occur. Miners can move into these cryptocurrencies and they could even increase in price. The ones with the most ballots are ERGO and Ethereum Classic , which show two quite interesting projects.
The thing is, if these last two go up, we could see strong demand , again, for graphics cards . Just now that the graphics market is in a coma due to the very low demand. We don’t know if it will happen, but come on, it’s not a disposable scenario at all.
But why don’t they start mining Bitcoin?
Surely you are wondering that, if mining in Ethereum ends, the most normal thing is that they go to Bitcoin . The reality is that if it were possible to mine Bitcoin with graphics cards, it is already something that would be done. Well, I lie, it is possible to mine Bitcoin with graphs , but you are not going to get even to pay for electricity.
When Bitcoin appeared, back in 2009, domestic processors were used, then it went to graphics cards and in 2012 the first ASICs began to appear. The reason why ASICs (special equipment with many chips) are used is because of their high efficiency. They are very powerful and it makes them extremely efficient, since they are specifically developed for that process. Mining Bitcoin with a graphics card would be similar to trying to knock down a skyscraper with your fists.
Maybe you wonder, why are there no ASICs for Ethereum mining? Yes, there are, but they are very expensive and difficult to manufacture. The trick of Ethereum is that you need a lot of memory and have a lot of bandwidth . Graphics cards are perfect, since they have a lot of VRAM and the bandwidth is very high. This is required because Ethereum has the DAG, a kind of file that helps in mining and weighs more than 4 GB. Also, the weight of this file increases every 2016 blocks.
In short, that Ethereum Merge may cause mining to move to other cryptocurrencies, it might not go away. If these altcoins were to rise in price, we could once again experience a chart shortage and another gargantuan price surge.