With Ethereum successfully transitioning to the proof of stake consensus, the miners had to look for alternate options. The Ethereum developers had for a long time suggested miners migrate to other proof of work projects like Ethereum Classic. Prior to the Merge, there was reasonable social activity around proof of work based blockchain networks. On the other side, a White House report on energy usage indicated that the U.S. government would have to curtail mining dependent on excessive energy usage.
The report suggested placing a limit or a ban on crypto mining, particularly the energy inefficient way. The White House mentioned its restrictions on high energy intensity consensus mechanisms like the proof of work method.
Ethereum Miners Migrate To These Cryptocurrencies
Following Ethereum’s shift to the new consensus mechanism, miners shifted to a few other projects. The miners are largely dependent on just a few blockchains — Ethereum Classic, Ergo and Ravencoin. According to a Forbes report, these projects are reasonably better options considering the mining capabilities and rewards. Hence, on the day The Merge successfully completed, these cryptocurrencies saw huge spike in hashrate. Hash rate is the total computational power used by cryptocurrencies to mine and process transactions. This indicates the speed of mining on the blockchain network.
Miner Profits Plunge
Hashrates on Ethereum Classic, Ravencoin, and Ergo surged by 124%, 98% and 146% respectively following Ethereum Merge completion on September 17. However, the mining capabilities on these networks only support a fraction of what Ethereum offered before The Merge. While hashrate for Ethereum before the Merge was around 867 (TH/s), these three networks offer only 28% of it. Morover, with increased miner traffic on these networks, profits have decreased compared with pre-Merge levels.
Meanwhile, the price of Ethereum Classic (ETC) plunged post The Merge and failed to recover since. As of writing, ETC price stands at $34.21, down 1.13% in the last 24 hours, according to price tracking platform CoinMarketCap. Same is the case with Ethereum (ETH) which is continuing to fluctuate in post Merge levels. As of writing, ETH price stands at $1,454.58, up 0.73% in the last 24 hours.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.