The Ethereum merge is due in a few days, and the CEO of WhiteRock believes that this will allow other coins to experience an increase in miners.
The Ethereum network is set to transition from a proof-of-work (PoW) consensus to a proof-of-stake (PoS) mechanism later this month. The move is designed to upgrade the Ethereum blockchain to make it faster, more scalable, and reduce transaction costs.
However, Andy Long, CEO of bitcoin miner WhiteRock, told Cointelegraph in a recent interview that the transition is likely to flood the crypto industry with no longer working ETH miners.
Long said that Ethereum miners will seek greener pastures after the merge event, and this will swamp other coins, increasing mining difficulty and reducing profitability. They said that;
“As GPU miners point their hardware to other chains, their difficulty will increase, leading to diminishing returns and splitting the reward among more miners. The hashrate will flow into alternative GPU PoW coins, and many miners will simply give up and Will try to sell my playing cards.”
The CEO believes that the migration could force some cryptocurrency miners to give up and abandon their mining equipment. They said that;
“Some miners will try to sell their high-performance computing (HPC) or GPU cloud services and possibly fail because there is too much potential to chase down limited amounts of demand.”
In recent months, there has been a drop in the price of GPUs, which is related to the reduction in the prices of bitcoin and other cryptocurrencies. As a result, some companies are selling their rigs below list price, while vendors maintaining normal prices are struggling to unload mining rigs and cards.
Regardless of the upcoming merger, Long said he is interested to see how market forces play out over the long term. he said;
“When I was building GPU farms in 2017, merge was cited as an imminent threat and it would have been much more impactful then. GPUs will always be mining some GPU optimized chains, but I doubt that we ETH will return to its peak again at the level of revenue seen in Proof-of-Work.”
The Ethereum merge event is scheduled to take place between September 10-20 and is considered one of the most significant upgrades in the cryptocurrency market in 2022.