What’s stopping miners from going to Ethereum Classic once the switch happens? It seems like the obvious choice here. I know the hash function is slightly different, so maybe it’s not ideal but it only seems to have a few parameters tweaked. It’s not like ETC is a total shitcoin compared to most other coins on exchanges.
It feels unlikely that miners won’t find something to mine.
As others have said, those other coins will get increased competition splitting the mining returns. Unfortunately (for the miners), Ethereum is vastly bigger than all the other coins.
I checked whattomine a few days ago and compared the hash rates of each coin. To make it simpler to compare, I converted it into RTX3080 equivalents. With this measure the hash rate for Ethereum was equivalent to mining with a bit shy of 10 million RTX3080s.
Ethereum Classic, which is the second biggest coin listed on whattomine, had a hash rate equivalent to about 263000 RTX3080s. I.e. Ethereum has 37 times more miners than Classic, and if they all moved to Classic the revenue would be slashed to 1/38 of what it is now while everybody would incur the same costs as now.
Ravencoin is the second biggest mineable coin (Monero isn't profitable to mine even now, so it does not matter) and Ethereum is 83 times bigger than Ravencoin.
It turns out Ethereum is more than 16 times bigger than every other coin listed on whattomine combined.
Yes, the question is if the thing they mine makes sense financially. If overall, people will use the POS chain better, the value of POS ETH will be much greater. So, the financial rewards, in USD, buying power, whatever, will be lower. They will also flock to other coins and they will increase difficulty, getting diminishing returns. So overall market cap of rewards decreases, the amount of hash power increases leading to much much much lower rewards.
I am willing to bet money that after ETH POS transition, graphics boards prices will crater.
> Perhaps it wouldn't happen overnight, but wouldn't ETC prices rally with more people participating in the network?
If my understanding of the crypto economics is right, no. The token price drives the mining effort, not the other way around. People buy these tokens because other people are willing to trade at that price, not because of the mining power within. Having more hash power does nothing for me as an owner of a token. The auto-scaling of the difficulty level is there to make attacks more expensive as the token value increases, it maintains the cost/benefit balance out of whack for any attacker. Only difference is slightly longer block mining time. Overall, nothing a normal user would feel.
Some people claim the other way, but I think they simply misunderstand the incentives. There was news that the Kazakstan crackdown led to the Bitcoin slump at some point, but that is, IMO, wrong, and they mistook some other events as causation. (in the same period, the stock market was also down).
GPU mining will still be a thing, but there simply will not be enough value to go around and the mining will crater until profits will be sustainable again. Extra mining gear will be sold. I maintain my prediction, and am really willing to put money where my mouth is.
I agree they'll likely find something to mine, but whatever it is has to make economic sense. If the block rewards don't cover the operational costs it won't work.
It is the obvious choice and it will definitely happen. Miners are in the business of mining with their hardware, they do it where it is the most profitable with their hardware. Since mining will give 0 return on ethereum, expect a glut of hash power pouring into other networks when it happens.
If any miner is dedicated to ethereum for some reason, I expect that they saved some of their block rewards to begin staking, and the smart ones are likely already staking on the beacon chain.
It feels unlikely that miners won’t find something to mine.