Will Crypto Mining Become Obsolete?

Cryptocurrency miners have a high risk of their machines becoming obsolete overnight. With Ethereum's upcoming merge with the Ethereum 2.0 Beacon chain, network mining will become a thing of the past. This means that miners will no longer receive block subsidies, transaction fees, or extractable value from miners (MEV). Instead, transaction fee and MEV revenues will be awarded to users who contribute to network security by staking their coin holdings in increments of 32 ETH.

It may still be some time before the doom of crypto mining releases its grip on our precious gaming GPU stocks. But there is a definite change on the way. Miners can develop machines from the ground up to mine a cryptocurrency very efficiently, producing more hash rate with less electricity. However, it may be difficult to continue mining cryptocurrencies profitably unless there are major changes in the popularity of certain currencies.

This centrality can be seen once again in China's crypto mining ban; while Ethereum saw a decline of approximately 20%, Bitcoin lost nearly 50% of its total hashing power, demonstrating that a large part of total Bitcoin mining came from certain regions of China. There are other Proof of Work cryptocurrencies that can be mined with consumer hardware for profit; however, with many Ethereum miners looking for new coins to mine, these alternative options may no longer be profitable. These miners will need to transition their graphics cards to mine other coins that are profitable with their equipment, and those coins are significantly smaller than Ethereum, as well as being less profitable to mine. After the merger occurs, mining difficulty will skyrocket due to the “difficulty bomb”, which is a mechanism to eliminate the incentive to mine Ethereum in favor of staking.

This means that it doesn't make sense or at least it's much less profitable to build mining platforms right now.

Shelly Riechman
Shelly Riechman

Infuriatingly humble music junkie. Award-winning student. Wannabe zombie aficionado. Hipster-friendly troublemaker. Social media enthusiast.