The prices of many popular GPUs, such as Nvidia’s RTX3080, have dropped nearly 60% in the last 90 days in some parts of the world.
Ethereum’s long-awaited transition to a proof-of-stake (PoS) consensus mechanism began on September 15, finally putting its long-running transaction in the rearview mirror. At this point, the network is now capable of processing between 20,000 and 100,000 transactions per second (TPS) compared to its previous rate of just 30 TPS.
Furthermore, the merger also made the Ethereum network up to 99.9% more energy efficient compared to its previous iteration, allaying fears about its excessive power consumption, a criticism that is still quite strong relative to the rest. of Bitcoin (BTC).
Amidst these developments, however, one question has continued to pique the interest of many cryptocurrency enthusiasts: “What will happen to the graphics processing unit market now that the transition is complete?”
It is worth noting that after the merger, the blockchain moved from its energy-intensive proof-of-work (PoW) mechanism to a PoS framework. As a result, miners who used to process transactions and produce blocks have been replaced by ecosystem participants who can now stake their ether.
Holdings to become network validators. As a result, Ethereum-centric graphics processing unit (GPU) mining was completely removed from the picture.
numbers don’t lie
After the upgrade was complete, the value of many coveted GPUs dropped dramatically. For example, reports indicate that the value of Nvidia’s popular RTX 3080 has dropped from $1,118 to roughly $700 (in the last three months) in China. Similarly, the price of GPUs made by companies like MSI has dropped $280 since the end of July.
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To get a better idea of whether these price increases could be influenced by the hype surrounding Ethereum Merge, Cointelegraph reached out to Crypto White, the pseudonymous CTO of ZK.Work, a zero-knowledge proof-of-mining platform. He noted that before the merger, Ethereum had a total of 860 terrahashes per second of hash power, of which less than 200 TH/s went to Ethereum Classic and ETHW, a PoW fork of Ethereum that went live after the merger. update, among others. . Mining projects, while 660 TH / s was temporarily closed.
Alluding to the Ethereum Classic hash rate chart shown above, White noted that incoming hash power appears to have been slowly leaving the network since mid-September, i.e. the time of the merger. In this regard, it is speculated that the price of Ethereum Classic
for 21.89 US dollars
has not increased as expected, and the flow of this computing power has led some miners to shut down their operations permanently. Add white:
“This shows that the cryptocurrency mining market has a lot of idle GPUs and the revenue from traditional mining cannot support their running costs, so they shut down and are faced with the choice of waiting for new mining opportunities or selling them. secondhand”.
In addition, he stated that many recently used NVIDIA 30-series GPUs entered the secondary market for sale, further driving down the price of GPUs. However, as potentially lucrative mineable coins continue to hit the market in the near future, White believes these GPUs will once again find utility.
What awaits the GPU market?
As is now evident, the Ethereum merger served as a major technical and industrial upgrade for the cryptocurrency mining sector as a whole. Ilman Shazhaev, founder and CEO of blockchain gaming metaverse Farcana, told Cointelegraph that despite this apparent decline, the GPU industry is now a perennial niche, especially with the continued emergence of different PoW protocols each year. passing day:
“Despite the transition, there will be no reduction in the number of protocols needed by GPUs and this will help maintain demand for these devices in the near future. Also, with the gradual adoption of metaverse-focused innovations, the ‘ Demand for GPUs, which are a key component of most game consoles, will continue.
In White’s opinion, GPUs won’t be much cheaper anytime soon, and their prices have likely stabilized around their current rates. In fact, he believes that the price changes we are seeing now have “already” been introduced.