Ethereum finally switches to proof-of-stake, ending GPU mining

[Tudor Cibean]

In a nutshell: The Merge upgrade has landed, switching the Ethereum network to a proof-of-stake (PoS) algorithm. The new system reduces electricity consumption by orders of magnitude as it doesn't require miners to validate transactions anymore. As a result, the market might soon get flooded with cheap used graphics cards.

Ethereum has finally switched its consensus mechanism from proof-of-work (PoW) to proof-of-stake (PoS). The upgrade, known as the Merge, has been in the works for the better part of a decade and brings several noteworthy improvements to the network.

The first phase of the Merge started on September 6, when the Bellatrix hard fork went live, which prepared the blockchain. Afterward, all that was left to do was wait for the Terminal Total Difficulty block to be mined, which would set off the so-called Paris upgrade. This just happened earlier today.

So, what exactly changed? Ethereum's PoW system worked by having crypto miners compete to write transactions to its ledger by solving cryptographic puzzles (earning Ether in exchange). This process was extremely energy intensive, with a single Ethereum transaction requiring 200 kWh, comparable to what a US household uses in a week. In fact, the whole network used around 78 TWh a year, about as much as Chile.

And we finalized!

Happy merge all. This is a big moment for the Ethereum ecosystem. Everyone who helped make the merge happen should feel very proud today.

— vitalik.eth (@VitalikButerin) September 15, 2022

On the other hand, the new PoS algorithm requires validators to hold and stake tokens (min. 32 ETH in this case). It works in a similar way to lottery tickets. The more ETH you stake, the more likely you are to get picked to write a block of transactions to Ethereum's digital ledger, which would earn you rewards. This system is significantly more efficient, with the Ethereum network expected to consume over 99.9% less energy. In turn, this will reduce global electricity consumption by 0.2%.

The Merge is also good news for gamers, as phasing out mining will hopefully avoid another GPU drought like the one we experienced in the past two years. Ethereum miners reportedly generated $733 million in revenue last month. Some will move to other GPU-mineable currencies, while others will sell their rigs to recoup investments. Due to this, used graphics card prices are likely to drop even more, though you should be wary of buying one as they come without a warranty and have been running at full load for weeks or months.

Permalink to story.

https://www.techspot.com/news/95983-ethereum-finally-switches-proof-stake-ending-gpu-mining.html

 

[emmzo]

Say hello to ETHW, the mining fork. Hopefully, it will fail miserably.

 

[fps4ever]

Good for less energy used...

 

[takaozo]

Let the real flow of used cards come to SH market!

 

[McMurdeR]

As much energy as a medium sized country! All the while there's a global warming crisis and an energy cost crisis.

With speculators and the likes of Nvidia and AMD creaming off the top. That the practice of proof of work hasn't been banned is an absolute scandal.

 

[Thatsdisgusting]

Lol, funny to see all forks submerging from tsunami of ETH miners. ETC has negative profit already.

 

[m4a4]

And where are those that said it was never ever going to happen (leaving no wiggle room)? Love to see them take back what was said now lol

I wonder if there will be another that rises as the next mining coin. I doubt that it was that easy to end most of the GPU mining...

 

[Fearghast]

This is an incredibly interesting move, as it might not only affect the second-biggest crypto, but create a pressure to force changes in other currencies as well.
You can bet clueless people like politicians will take ETH as a "golden standard" to ban something.

 

[Geralt]

Finally we got rid of those fu**ing miners once and for all!!!

 

[terzaerian]

Say hello to ETHW, the mining fork. Hopefully, it will fail miserably.

I would bet that, with the markets being down, that the inclination of dedicated ETH holders that now have ETHW as well would be to cash it out right away, to cover losses they've taken elsewhere with coin they've basically gotten for free. So I would see it taking a sharp drop in the near future.

That said stranger things have happened and the BSV and BCH forks of Bitcoin continue to cling to the underbelly of the ecosystem, so who knows.

And where are those that said it was never ever going to happen (leaving no wiggle room)? Love to see them take back what was said now lol

I wonder if there will be another that rises as the next mining coin. I doubt that it was that easy to end most of the GPU mining...

My hope is that the daisychained GPU rip mining falls out of fashion, and miners either sack up and buy ASICs or just mine casually on regular PCs.

 

[VitalyT]

Looks like it did not affect Ethereum price today at all. That's odd.

 

[Nobina]

Crypto was initially supposed to free us of banks and sht. It ended up being infested with greedy mfs who pretended they were in it for any other reason. That is why I prefer it goes away.

 

[Theinsanegamer]

Crypto was initially supposed to free us of banks and sht. It ended up being infested with greedy mfs who pretended they were in it for any other reason. That is why I prefer it goes away.

Crypto was never about "freeing" you from a bank. It was, from its inception, a system for the 5% to gain the profit they feel like they deserved over the 1%. Any effect of freeing people from banks was an accidental side effect.

 

[gamerk2]

Ladies and gentlemen: The definition of "shining a turd".

The faster crypto dies, the better.

 

[VitalyT]

Say hello to ETHW, the mining fork. Hopefully, it will fail miserably.

Say hello to my little fork!

 

[Nobina]

Crypto was never about "freeing" you from a bank. It was, from its inception, a system for the 5% to gain the profit they feel like they deserved over the 1%. Any effect of freeing people from banks was an accidental side effect.

I'm saying what it was sold as.

 

[EdmondRC]

Well that should nearly dry up the market for $1500 "Gaming" GPUs with 20+ GBs of VRAM. Sure, some enthusiasts will still buy them, but few gamers will. Previously those kind of price tags were reserved for workstation GPUs. I can't imagine that Nvidia will sell 1/2 as many 4090s as they did 3090s, at least not at $1500.

 

[BadThad]

Bring on the cheap video cards! The flip side, there are still many other coins to mine out there. Many will just switch to something else.

 

[FF222]

Miners will just stay on a proof-of-work hard fork, which in turn means that there will be NO decrease in the energy consumption of the network

 

[Gezzer]

Crypto was initially supposed to free us of banks and sht. It ended up being infested with greedy mfs who pretended they were in it for any other reason. That is why I prefer it goes away.

Actually crypto was never intended to free us from the banking system, that's the excuse that it's backers made. Blockchain is an interesting tech that was also a solution looking for a problem. So to validate blockchain, crypto was created to "free" us from the despotive banking system. Instead it became the currency of choice for criminals and speculators.

 

[Eldritch]

All these climate change summits, accords, talks of certain global water rise and we couldn't even block proof of work.
0.2% of world electricity will be saved from a simple change in one virtual coin. That also they did on their own. While the regulators and summit conveners hibernate and looks like will continue to do so.
Damn.

 

[ScottSoapbox]

And the next new gpu mineable crypto drops in 3... 2... 1...

 

[Gastec]

All these climate change summits, accords, talks of certain global water rise and we couldn't even block proof of work.
0.2% of world electricity will be saved from a simple change in one virtual coin. That also they did on their own. While the regulators and summit conveners hibernate and looks like will continue to do so.
Damn.

The regulators and summit conveners were busy printing money to give to crypto-miners.

 

[Axle Grease]

Say hello to ETHW, the mining fork. Hopefully, it will fail miserably.

 

[terzaerian]

Meanwhile, Dogecoin has become the second-largest POW coin. This pleases me. I like those plucky memers.