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Note that Ethereum is switching to proof of stake this year, almost surely before Q4. It's true that this upgrade has been coming for years, and it's also true
by spir 5y ago
Note that Ethereum is switching to proof of stake this year, almost surely before Q4. It's true that this upgrade has been coming for years, and it's also true that it's actually arriving this year (if interested, see https://eth2.news https://eth2.news).
After Ethereum switches to proof of stake, global demand for GPUs will plummet as GPUs are uncompetitive for BTC mining, and beyond BTC, ETH is by far the largest remaining proof of work coin.
- Melio 5y agoWhat's the difference this time?
- binarymax 5y agoRest assured there are many gamers who will pick up the slack, not to mention businesses who want them for training models.
- MisterSandman 5y agoThe main difference is that gamers are consumers, while ETH miners use GPUs to make income. Even though gamers were buying scalped GPUs, I'd imagine GPUs going to back to being treated as a consumable (rather than something that generates income) would help prices.
- jedberg 5y agoCompanies using GPUs to train models are also using them to make money. They will pick up the slack the miners leave behind.
- MisterSandman 5y agoI think you're overestimating hoe many companies use GPUs to train models, I highly doubt there are enough to drive prices up the way crypto had.
- senko 5y agoThis. I've been planning to buy a new gaming rig for two years, but wasn't so much a priority that I would pay exorbitant prices for even midrange hardware. When normality is restored, I'll be happy to finally upgrade.
- spir 5y agoI will be one of them :)
- Sebb767 5y agoBut people who don't necessarily need it and/or don't make money with it won't pay insane prices for (ab-)used mining GPUs. It won't be insanely cheap, but definitely a lot cheaper.
- evolve2k 5y agoWhen the time comes, for a casual gamer which popular etehrum mining GPU’s would you be on the lookout for?
- jotm 5y agoAren't Quadros/FirePros with lots of VRAM better for that?
- spamizbad 5y agoRight but what happens when another blockchain technology hits the scene that’s trendy and happens to be PoW? People who made significant investments into GPU miners and the infrastructure to support them won’t go away quietly.
- spir 5y agoThat's fair, what if another PoW coin gets really popular? The good news here may be two-fold 1) the existing group of public chains have matured greatly and their network effects are quite strong now. It is no longer so easy to start a new chain 2) virtually all new chains are PoS because it's understood to be significantly more secure and less expensive vs. PoW 3) public chains take years to grow, and right now, there is no PoW public chain on my radar that has a chance of generating nearly as much mining demand as Ethereum (and Bitcoin but ASICs) For those reasons, the idea of a new public chain appearing from nowhere and impacting GPU demand seems in practice unlikely to occur.
- atweiden 5y ago> virtually all new chains are PoS because it's understood to be significantly more secure and less expensive vs. PoW PoS security relies on the integrity of the stake — and the integrity of the stake relies on the “security” of the PoS system. It’s an intractible circularity problem. Yes, a large sample of recent altcoins have shipped PoS, but this is no more relevant to a PoW v PoS security debate than a modern top 40 “hit songs” chart is to a debate over Beethoven v Bach.
- Havoc 5y agoThere are a handful of other PoW coins not far behind Ethereum so I wouldn't count on demand plummeting https://whattomine.com/ https://whattomine.com/
- mkr-hn 5y agoCan you translate for people (like me) who don't know what all those numbers are supposed to represent? I can't make sense of it or relate any of them to GPU demand.
- ehsankia 5y agoI don't understand much of the site either, but at a high level, my guess is that it's sorting crypto coins by computation required vs $$$. Right now ETH is at the top, aka for every flop you put it, you get the most return, but there are many others not far behind. So even if you were to eliminate Etherium entirely, there would still be plenty other that are profitable to mine. Why sell a GPU for a fraction of the price, when you can just switch over to another coin and make 50-90% of the money you were making still.
- Havoc 5y agoIf you have a GPU you could use it to "mine" various coins. That site calculates which of them is currently the most profitable and how much profit you're likely to make with a given hardware configuration
- spir 5y agoThanks, I hadn't seen that site. In my view, this site is strong evidence for the thesis that demand for GPUs will plummet, here's why: 1) If we tweak your link to sort by Market Cap, we can see the next biggest coin to mine after ETH is has only 1% of ETH's market cap https://shorturl.at/lxLS5 https://shorturl.at/lxLS5 2) These smaller coins do not have the capability to automatically or naturally grow bigger market caps, trading volumes, and buy-side demand just because ETH switches to PoS. Mining profitability ultimately comes from a coin's buy-side demand, which is proportional to many things-- fame, developer activity, etc.-- and none of the PoW chains in that list are anywhere remotely close to "breaking out" and growing proportionally with Ethereum, or, say, Solana. How do I know this? Well, I'm an insider that focuses all of his time on ethereum and web3, you'll have to take my word for it :)
- trompetenaccoun 5y ago>and it's also true that it's actually arriving this year Do you have insider knowledge or just a quality crystal ball?
- spir 5y agoI have been full-time on Ethereum for years, I'm a software engineer, and I have a relatively intimate knowledge of the specific milestones the community has been achieving and why that implies that proof of stake will ship this year. Here's an overview Dec 2020: proof of stake launched in production, but isn't yet used to secure ethereum, it runs in parallel October 2021: the last major upgrade to Ethereum before switching to proof of stake went live in production Today: proof of stake "Merge" testnets are live, all core teams are 100% focused on the merge, regular progress reports are nominal, etc.
- encryptluks2 5y agoPeople that care about PoS could have already invested in something else. The people stuck on Ethereum will boast about PoS coming soon, but if tomorrow they said they were going to wait for 5 more years they'd stick with Ethereum and talk about PoS for 5 more years without switching to a different PoS token.
- Animats 5y agoNote that Ethereum is switching to proof of stake this year, almost surely before Q4. Is there some way you can bet against that claim?
- spir 5y agoAbsolutely! Please see this Polymarket prediction market on "When will Ethereum switch to proof of stake?" https://polymarket.com/market-group/ethereum-merge-pos https://polymarket.com/market-group/ethereum-merge-pos
- expicli 5y agoYeah, its not gonna plummet. Theres still going to be huge demand. PS5s and Xboxes arent used for crypto and theyre still sold out
- radicalbyte 5y agoI wonder what will happen: Ethereum switching to PoS or Tesla having full self-driving.
- WheatM 5y ago