Ethereum 2.0 – Miner’s View

Non-ETH GPU mining industry will collapse soon. After c.2 remaining years of ETH mining, GPU mining will almost disappear

Congratulation for the launch of Beacon Chain as Phase 0 of migration to Ethereum 2.0 to solve problems of Ethereum network!

Upon implementation of Phase 1.5 in 2022 (or 2021), legacy Ethereum 1.0 mainnet will be integrated into ETH2 and Proof of Work will end its role. Goodbye miners from Ethereum world!!

So what happens for miners during the final c.2 years and after that?

Hashrate & DAG File Size

A headache for ETH miner is an increasing DAG file size, which just reached 4GB, meaning miners with 4GB or less of VRAM is no longer able to mine Ethereum. Current network hashrate is c.290 TH/s, but steep decline is expected shortly.

Ethereum mining is supposed to be ended by 2022 and DAG file size will reach c.5.2 GB in end of 2022. 6GB VRAM miner is recommended to keep mining until the very end of mining period.

An article claims c.40% (c.70TH/s) of network hashrate was from Bitmain ASICs (E3) as at Mar-2020 when network hashrate was c.180TH/s. An another article claims c.60% (c.110TH/s) of hashrate is from 4GB GPU rigs as at Feb-2020.

Although some firmware/software enables extension of life of 4GB rigs, these 4GB miners are gradually ending its life in this/next year and total c.100+ TH/s hashrate is being lost.

Where ETH Miners Go?

Above chart shows daily mining reward by coins as at 24-Dec. Yes, Ethereum (ETH) is everything, and other coins are…

Recently introduced Ethereum Classic’s Thanos upgrade enables 4GB ETH miners to migrate to ETC mining, however ETC does not have enough capacity to accept 100+ TH/s miners from ETH. Also there is no other such sizable GPU mining coins, meaning entire non-ETH GPU mining world becomes an extreme red oceans very soon due to migration from ETH and only miners with cheap tariff can survive.

ETH miners will enjoy 2 years of remaining life, on which period hashrate increase will be modest, while ETH price will perform well thanks to BTC’s post-halving rally. But after the 2 years period ends, these miners will experience same nightmare that 4GB ETH miners are experiencing right now.

Upon introduction of Phase 1.5 of ETH2, entire GPU mining industry will almost disappear and only small scale mining of XMR/ETC/RVN etc will be remained.

Cloud Computing – New Frontier for GPU Miners

Although most of GPU miners will simply shut down their operation, they don’t notice they have strong competitiveness in “Cloud Computing“, my wild card proposal.

I’m AI developer and I often use GPU of Paperspace cloud computing services to train my machine learning model. Paperspace offers a remote access to Linux/Windows-installed computer connected with GPU. AI packages like Tensorflow is pre-installed in the virtual machine. So, technically what they offer is an access to PC and GPU through high-speed internet, because large files (picture, movie) are often used for AI training.

On cloud computing world (AI, gaming, etc.), major cost is GPU/computer and electricity tariff. GPU miners already have depreciated GPU and an access to cheapest electricity tariff. So why don’t you leverage your strength in cloud computing world?? Entry barrier into this industry is not so high and you can beat existing players by price competition.

I guess some large-scale GPU miners will pursue Cloud Computing opportunity, likely through tie-up with existing players. Goodluck challerngers!


2 thoughts on “Ethereum 2.0 – Miner’s View

  1. It’s been a year since your last post…I wonder if you are still mining in Georgia because I am looking for information about it

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