Ethereum moving to Proof of Stake is something that has been planned for many years but is now closer to becoming a reality. The merger will most likely take place in January 2019. What does this mean for GPU mining then? Are we really at the end? Get the latest news about cryptocurrency, today’s best crypto tips to trade and updated market value on Wall Street Invests.
These are the likely outcomes, and they look pretty good for GPU miners.
Less LHR to worry about
If you have been mining for some time, you will be familiar with LHR (light-hash rate). NVIDIA attempted to make it more difficult to mine GPUs. LHR is mainly affecting Ethereum mining. This means that ETH will not be mined anymore and your GPU will still be able to mine other algorithms on the same hash power. Other algorithms are also affected, but not as much as Ethereum. NVIDIA is not likely to add another version LHR to their 3000 series. They are currently working on the 4000 series. Even if they do, the developers found a way to bypass LHR in a matter of months. More people will discover ways to bypass it as time passes. You can still mine with GPUs if you have recently bought them, with better hashrates, if ETH goes to PoS.
The playing field will open up
When ETH stops mining, it will create a more profitable environment for other algorithms. This is good for competition and could lead to rapid growth. Other algorithms will likely pick up hashrate and increase their speed in the market cycle.
Miners won’t stop mining
Miners will continue to mine as long as there is money to mine, which will always be the case. This means that miners will move to other algorithms once ETH is at PoS. Those may not be profitable right now. This is largely due to the fact that all attention is on ETH. However, once it’s gone the hashrate surge will increase interest in other coins which will drive their value higher.
The difficulty of will increase – but so will prices
It has been a common trend since the inception of crypto that the more hashrate the coin is worth, the more expensive it has become. Although it will be more difficult, prices will rise. Most PoW blockchains will see a rise in value as the mining rate increases. This is because there are more users of the coin (ie. To pay for costs, etc., you can convert to fiat and increase liquidity. Use in any economic model (economy, gold, cash or crypto) is closely tied to value. This is because of simple economics: the more people use something, the higher its value (which is why Bitcoin remains the most popular coin). There are more people mining hashrate, which means that more people use, exchange, and send the coins around, increasing the coin’s value. We all know that the more hashrate, the more difficult it is and the lower the profit until the coin’s prices rise. We will likely experience a few months of low profits, but this will be compensated by the inducible increase in the value of the coins being mined.
Any regulation favors GPU mining over ASICs
We all know that the crypto industry will be subject to more regulation. As we saw in China, some countries have taken steps to ban mining. This is an extremely difficult area to regulate in practice. The biggest ASIC farms are most likely to be affected, as they are easily visible on the grid. Small miners who only have a few GPUs need not worry, as it is physically impossible to stop them spread across millions of homes.
Proof Of Stake is still relatively recent
Although Proof of Stake solves some of the problems of Proof of Work, such as environmental impact and scalability, it also encourages centralized wealth. PoS is a risky move because it reduces liquidity (especially since Casper is being implemented on Ethereum), which could lead to centralized wealth. PoS implementation has yet to have an impact on the real world. It is only used by a handful of blockchains and is not used for direct payment like Bitcoin.
Decentralized algorithms are likely to be preferred
Coins like ETH will become more centralized. This will lead to a greater demand for a decentralized version. Even Bitcoin mining is centralized in some ways, since only large ASIC farms are able to mine it. As they are true to the original ethos behind cryptocurrency, economic freedom, other algorithms that can resist ASIC mining will be popular.
NiceHash offers many algorithms for mining
We are not a mining pool so it is very simple to modify algorithms to mine. There are over 30 algorithms available. Many of these algorithms can be used for GPU mining. Our software can detect the best and switch to mine that most profitable. NiceHash Miner will automatically find the most profitable coins for you when ETH is gone.
Last but not least, miners are hard workers
Anyone who has invested in crypto for any length of time is well aware of the volatility of investment. This is partly why it’s so appealing. It is important to remain patient in this industry. Profits may drop for a month or a few months but they always rebound. Ask anyone who bought bitcoin two years ago or five years ago and was able to wait. Keep your sanity intact and pay crypto directly whenever possible. Enjoy the ride! This industry will continue to grow as more people use crypto.
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