thecoinrepublic.com
- Despite the coming changeover to proof-of-stake, major bitcoin (BTC, +2% ) mining corporations and miner manufacturers are expanding their investments in ethereum (ETH, +2.28 percent ) mining
- They were told mining would finish four years ago, yet it is still going, said Mark D’Aria, CEO of Bitpro, a New York-based consulting firm specializing in Ethereum mining gear trading and administration
- Aside from technological obstacles and security concerns for Ethereum assets, potential pushback from the Ethereum mining community could hinder the network’s transition to POS
Despite the coming changeover to proof-of-stake, major bitcoin (BTC, +2% ) mining corporations and miner manufacturers are expanding their investments in ethereum (ETH, +2.28 percent ) mining. Hut 8 and Hive, two public bitcoin mining businesses, are expanding their capacity to mine the second-largest cryptocurrency by market capitalization.
Meanwhile, ethereum mining machines from Bitmain and Innosilicon are expected to be released later this year. Given that the Ethereum system is expected to transition from proof-of-work (POW) to proof-of-stake (POS) in five months, and POS mining does not require such powerful computers, this investment may appear odd. Industry experts believe the increased demand is due to predictions that the migration will be postponed.
They were told mining would finish four years ago, yet it is still going, said Mark D’Aria, CEO of Bitpro, a New York-based consulting firm specializing in Ethereum mining gear trading and administration. They have always had a wait-and-see approach because things take longer than everyone anticipates. While last week’s London fork gets the network closer to Ethereum 2.0, important enhancements have been plagued by delays throughout Ethereum’s six-year lifetime. For example, the Constantinople upgrade, which was a significant step toward Ethereum 2.0, was supposed to go live in July 2018, but a flaw in the code caused it to be postponed until February 2019, further delaying the migration.
The difficulty bomb created an Ethereum Improvement Proposal (EIP) 3554, which adds artificial miners to increase mining difficulty and make mining operations less economical. The “Ice Age” was the name given to this time period. This EIP was first offered by Ethereum developers in 2015, but it has been postponed until December 2021.
Ethereum has risen above $3,000, Decentralized Finance (DeFi) is being constructed on top of the network, and [non-fungible tokens] have exploded, Vera stated. Even those who are bullish about Ethereum’s POS transition want to take it gently to ensure that everything is done right and that the developers are not ignoring any potential doubts, problems, or blind spots.
Aside from technological obstacles and security concerns for Ethereum assets, potential pushback from the Ethereum mining community could hinder the network’s transition to POS. One thing that hasn’t been fully realized is the amount of resistance that proof-of-stake migration will face, D’Aria added. To assume they’re just going to turn off billions of dollars worth of miners with a switch is insane; that’s not going to happen.
Ethereum mining has a higher number of individual miners and a lower number of large-scale miners than bitcoin mining. According to Vera, mining ETH using graphics processing units (GPU) at home is viable because of the relatively low energy consumption compared to bitcoin miners, as well as the modest amounts of heat and noise generated by ethereum mining rigs.
More than 90% of ethereum mining computers use GPUs, which are also commonly used by gamers, according to D’Aria. Crypto mining heavyweights, on the other hand, are attempting to enter into the business and earn at a higher rate than bitcoin mining. According to a financial report released by Hive Blockchain on Oct. 15, 2020, the firm claimed it had become the world’s largest public ethereum miner with 3,383 gigahashes per second (GH/s), which represented 1.3 percent of the Ethereum network’s total hashrate at the time. By the end of the year, the Vancouver-based company hopes to have increased its ethereum mining hashrate to 5,500 GH/s, a 62.5 percent increase over the previous level. In February, Hive purchased a 50-megawatt (MW) data center from GPU One, a data center colocation services provider in New Brunswick, Canada.
In May, Hut 8, a public crypto mining company, paid $30 million to GPU maker Nvidia for dedicated Ethereum miners. All miners are expected to be delivered and installed in the business’s Alberta facilities by the end of August, according to the company. It intends to have a hashrate of 1,600 GH/s and power consumption of 4MW. Hut 8’s goal of expanding revenue diversity and driving urgent short- and long-term revenue growth objectives forward in FY 2021 will be strengthened by this acquisition, according to the firm. In May, Hut 8, a public crypto mining company, paid $30 million to GPU maker Nvidia for dedicated Ethereum miners. All miners are expected to be delivered and installed in the business’s Alberta facilities by the end of August, according to the company. It intends to have a hashrate of 1,600 GH/s and power consumption of 4MW. Hut 8’s goal of expanding revenue diversity and driving urgent short- and long-term revenue growth objectives forward in FY 2021 will be strengthened by this acquisition, according to the firm.