As we approached the Ethereum merger, the crypto community was more outspoken than usual. The long-awaited ETH 2.0 changes the consensus mechanism of the blockchain to a Proof-of-Stake model, driving ETH miners out of the market. In addition to their chance of exiting the mining industry, they may also choose to hard fork the Ethereum network, or try to switch to a different blockchain.
what is the problem?
Recently, former ETH miner Guo Hongcai mentioned in an article interview Several Chinese Ethereum miner manufacturers contacted him to initiate the fork work. According to reporter Colin Wu, after Merge, nearly $5 billion of graphics card miners and ASIC Ethereum miners (A11 E9) need to find a way to continue mining.
Currently, there are nearly $5 billion in graphics card miners and ASIC Ethereum miners (A11 E9) that need to figure out a way to continue mining after Ethereum switches to POS in September. Most belong to Chinese miners.
— Wu Blockchain (@WuBlockchain) July 29, 2022
While ETH’s move to PoS will significantly reduce power consumption, miners are concerned about how they will continue to operate. For some, a hard fork that allows them to continue mining cryptocurrency is a good idea.
Despite all the hype surrounding Ethereum 2.0 in the crypto community, as always, opinions are divided. In fact, in a recent Twitter post, MakerDAO pointed out that the merger would do more harm than good.
Impact on Maker:
• Minimal impact if all externally supported asset issuers support merge upgrades.
• If one or more issuers support a PoW fork, this could have significant implications for DEX liquidity pools and other protocols that accept assets as collateral.
— Maker (@MakerDAO) August 5, 2022
Ethereum miners have faced various challenges over the past few months in order to make a profit from mining ETH. The profitability of ETH miners has been severely affected by the collapse of the cryptocurrency market and rising electricity prices around the world.
According to Bitinfocharts, the mining profit in July 2022 is lower than in 2021, when the profit of 1 MHash/s was only $0.025/day.
Therefore, a hard fork does not appear to be a viable option for miners as they still struggle to generate profits. Another indication that a hard fork is least likely is a reduction in the total hash rate of the Ethereum network, as this indicates that miners are flowing out of the network.
While the hash rate of the ETH network has dropped, it has seen a massive influx of new miners onto the Ethereum Classic blockchain. Given Ethereum Classic’s performance over the past month, it could be a viable alternative to miners’ ETH.
Since ETC operates on the PoW consensus mechanism, a new hard fork in the Ethereum network seems illogical. Given the existence of more lucrative alternatives to Ethereum, there is little chance of another hard fork.