STAKING

Possible Ethereum Blockchain Civil War, Here’s What’s Happening

Ethereum has been planning its transition to Ethereum 2.0 since its release in 2015, but now that the date of ‘The Merge’ has finally been declared in late September, some crypto miners are threatening to fork the blockchain. Ethereum’s upgrade will fix its energy consumption issues by moving from crypto mining to staking, but ETH miners will lose their bread and butter.

Ethereum was the first blockchain to use smart contracts, small programs that can create cryptocurrencies, NFTs (or non-fungible tokens), and a wide variety of programs and applications. ETH has been the most profitable cryptocurrency to mine due to its ability to be mined with standard GPUs rather than the expensive ASIC rigs used for mining BTC, and this low cost of entry has made ETH very profitable to mine, but now that Ethereum is moving from mining to staking this will no longer be possible.

SCREENRANT VIDEO OF THE DAY

Related: What Is unMineable, And Is It Safe?

Ever since The Merge was announced, a schism has emerged within the Ethereum community, forming two sides of a “Second Ethereum Civil War,” populated by the crypto miners on one side who want to keep mining for ether (ETH) and Ethereum’s user base on the other side who want Ethereum 2.0 to happen, so Ethereum can achieve its full potential (and so the transaction fees can go down). CoinGape provides a list of leaders, miners and exchanges who have either declared their support for a “hard-fork” to preserve crypto mining or who have condemned the idea. If a hard-fork takes place, then a new cryptocurrency, ETHw, will exist along with a new copy of the Ethereum blockchain, but it is unlikely that anyone will use it, and a hard-fork will have zero impact on post-Merge Ethereum.


Miners Will Move To Ethereum Classic Or Move On

This is not the first time Ethereum has been through a hard fork. In 2016, the events surrounding The DAO smart contract hack resulted in Ethereum’s first hard-fork and the creation of Ethereum Classic. This event caused a massive philosophical civil war in the community over Ethereum’s founding principles, but in the end, these principles were abandoned out of pragmatism. Ethereum was hard-forked to roll back the consequences of the hack, while those who adhered to Ethereum’s founding principles stayed behind on the newly renamed “Ethereum Classic.

A similar situation may unfold over The Merge, but instead of a philosophical debate about the founding principles of Ethereum, it is because some crypto miners didn’t prepare for an event that has been openly discussed (and even memed) for the past seven years. There isn’t enough developer support or market demand for a Proof of Work fork of Ethereum, so miners will have no choice but to migrate to Ethereum Classic eventually. However, without any reason for Web 3.0 or blockchain metaverse apps to build on Ethereum Classic, mining its ETC cryptocurrency may not be profitable either.

Ethereum was never intended to remain a Proof of Work blockchain secured by crypto mining. The Ethereum Foundation has planned to transition to Ethereum 2.0 front and center of Ethereum’s roadmap for its whole existence. Miners have had several years to prepare for this event, but it seems some of them didn’t plan. It is unknown how many Ethereum miners will choose to move to Ethereum Classic versus how many will attempt to mine the forked blockchain, but forking Ethereum doesn’t look like a promising option, and mining Ethereum Classic may or may not sustain their business models.


Source: CoinGape

Traciwininger
Author: Traciwininger

Leave a Reply

Your email address will not be published.

Back to top button

Sign In

Register

Reset Password

Please enter your username or email address, you will receive a link to create a new password via email.