ETH - Why Is Nobody Talking About What Will Happen to the Ethereum Miners After the Merge?
In the crypto world, there has understandably been much excitement about Ethereum (CRYPTO: ETH) and its long-anticipated technological upgrade known as the Merge. The investment thesis for Ethereum seems simple enough, right? You buy the upgrade and you count your profits later.
However, focusing only on the technological aspect of the Merge is ignoring a very important group of people who helped make Ethereum possible. These people are the Ethereum miners. As JPMorgan recently pointed out in a research note, as soon as Ethereum flips the switch in mid-September, all Ethereum miners will be out of work and will need to find new ways to make money. What happens to them next could have important consequences for the future of Ethereum and Ethereum Classic (CRYPTO: ETC) .
The current version of Ethereum uses a proof-of-work consensus mechanism that requires mining, and this involves mining rigs, which are essentially just connected graphics processing units (GPUs). Ethereum miners use these mining rigs to create new blocks of Ethereum for the blockchain. In exchange, they are rewarded with Ethereum. As you might imagine, this has been a profitable (albeit energy-intensive) endeavor, and many Ethereum miners would probably like to continue with this way of life.
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Why Is Nobody Talking About What Will Happen to the Ethereum Miners After the Merge?