PoW Hard Fork or Staking : ETH Merge Divides the Crypto Community

Key Takeaways

  • Ethereum co-founder Vitalik Buterin believes ETC is a better PoW alternative to Ethereum.
  • EtherMine released a beta version of EtherMine Staking that will offer stake pool services for the post-Merge era. 
  • f2pool, the second largest Ethereum mining pool, acknowledges the new Era of PoS.”
  • Chainlink will no longer have proof-of-work (PoW) forks, while BitMEX has said it will launch a linear futures contract to expose its users to ETHPOW.

The Ethereum Merge is right around the corner. The Merge completes Ethereum’s transition from the proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) blockchain pushing ETH miners out of business.

According to Colin Wu, a crypto journalist, the Merge will displace $5B worth of GPU and ASIC-based mining hardware. Mining pools now have the option to redirect their expensive and powerful specialized computers to Ethereum Classic. Ethereum co-founder Vitalik Buterin believes ETC is a better PoW alternative to Ethereum.

AntPool, the mining pool linked with Bitmain, has invested $10 million into developing Ethereum Classic. There’s also speculation that Individual miners may protest, fork off and create their PoW versions of Ethereum when the upgrade takes effect. Hongcai “Chandler” Guo, a former ETH miner, has mentioned that multiple Chinese Ethereum mining machine manufacturers have reached out to him to initiate forking efforts.

Since PoS migration will cast out Ethereum miners from the network, most mining pools have remained split regarding their options after the upgrade.  Commenting on the divide within the ETH mining community. f2pool, the second largest Ethereum mining pool, has said, “Whether to support the Ether fork or not is no longer important. We will let the miner community decide. However, we acknowledge that the era of ETH PoW is at its end and let us move on to the new Era of PoS”

The pool further hailed the Ethereum miners for securing the chain for over seven years.  “Ether miners are the unsung heroes of the Ether ecosystem. They tend to be low-key and have secured the ether chain quietly for more than 7 years.

The largest Ethereum mining pool, EtherMine, released a beta version of EtherMine Staking that will offer stake pool services for the post-Merge era.  Ethermine and f2pool account for almost half of all hash power, currently being directed to mine Ethereum.

Commenting on the future of Individual miners, Butta, the pseudonymous CMO of Bitfly, EtherMine’s parent company, said their main goal is to “onboard our current miners from PoW to PoS.” Butta added that most deposits to EtherMine’s new staking platform have come from existing miners.

The Chainlink has announced that the forked versions of the Ethereum blockchain, which includes proof-of-work (PoW) forks, will no longer be supported by the protocol post-Merge. It further urged its users to prepare their smart contract operations accordingly to avoid future mishaps during and after the implementation of PoS.

While Chainlink is against Ethereum PoW blockchain, leading crypto exchange OKX said it will support the Ethereum Merge and evaluate all ETH forked tokens that may emerge in the future for possible listing.

Tron founder Justin Sun is also one of the biggest supporters of the hard fork since it will allow miners to earn as they continue to support a newly separated PoW version of the chain. Sun-backed crypto exchange Poloniex has offered support for the Ethereum fork and will list both ether and the forked token, called ETHW.

Another exchange BitMEX has also said it will launch a linear futures contract for its users to get exposure to ETHPOW.

Crypto exchanges, mining pools, and analysts have chosen their side in the ETHPoW vs. PoS debate. However, it is the individual Ethereum miner and their revenue that will be impacted the most by the Merge. No matter what the miners decide to do, whether it’s a hard fork or initiate staking, there’s no doubt it will take time to make it as financially viable as mining Ethereum.

Saniya Raahath
Saniya Raahath

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