What to do after Ethereum's move to Proof-of-Stake?
Ethereum's move to proof of stake is getting closer: what should you do with your graphics cards once Ethereum can no longer be mined? In this video of about twenty minutes (in French), we review the options open to GPU miners, from the simplest (changing nothing) to the most ambitious (relocating your farm or running it on solar power), with the pros and limits of each.
Video from 2022, recorded before Ethereum moved to proof of stake: the figures below date from that time. See "What about today?" at the end of the article.
Don't panic and keep mining
The first option, which we present with a touch of humour, is to do nothing. The date of the switch to proof of stake was still uncertain: a few days before the video, Beacon Chain tests on a testnet had run into problems again. So there is no need to panic or to tell yourself that mining will no longer pay: what comes next may simply be to keep your machines running, mining something else.
Sell or upgrade your hardware
Selling your hardware can make sense at certain times, especially to buy equipment better suited to life after Ethereum. But timing matters: when the video was made, many miners were selling their cards on the second-hand market. In our view it was not necessarily a good time to sell, rather a good time to buy: new graphics cards could be found at around €10 per MH/s, something never seen before, compared with nearly €20 per MH/s at the end of 2021.
The right choice depends on what you want to mine next:
- Ethereum Classic uses the same algorithm as Ethereum: nothing changes, your current cards are fine;
- for other cryptocurrencies such as Ergo, Flux or Ravencoin, older series like the RX 480 and RX 580 are less suitable: you may be better off selling some of them to buy more recent cards.
What about ASICs?
Another possibility is to switch to ASICs, machines designed for a single purpose. On Ethash, Ethereum's algorithm, an ASIC uses three to four times less electricity than graphics cards; after that it is a question of price. Their drawback: unlike a graphics card, they cannot mine every cryptocurrency you might want.
Mine other cryptocurrencies, alone or with dual mining
Each cryptocurrency has its own algorithm, which does not stress the same parts of the graphics card: mostly the memory for Ethereum, mostly the graphics processor (GPU) for others. Two things to watch:
- some coins, such as Ergo, draw little power and give off less heat: no need to change your hardware;
- if you want to mine Flux, Ravencoin or other coins, pay attention to the sizing of your power supplies.
Dual mining means mining two cryptocurrencies at the same time. Pairing Ethereum with another coin such as Toncoin, whose mining was coming to an end, brought about 30% more profitability. Other dual mining combinations remain possible.
Try solo mining
Solo mining is a return to the fundamentals of mining: instead of mining in a pool and sharing the rewards, you try to find whole blocks on your own. You still need a certain amount of hashrate: we do not recommend it on Ethereum, where it is the big mining farms that find the blocks. On Ergo, however, the mining difficulty had halved compared with the previous year, which makes solo mining more accessible. As a test, we switched 1 GH/s of hashrate that was mining Ethereum to solo mining on Ergo. There is of course an element of luck, and we are going to leave this test running to see how it turns out.
Masternodes and staking
With proof of stake, networks of servers, called nodes or masternodes, run the blockchain in exchange for locked collateral. On Ethereum you need 32 ETH to set up a node, for a return of around 5%, clearly less attractive than other coins, some of which show returns of 10, 15, sometimes 20% (we had not redone the calculations recently). Some projects, such as Flux, combine both: you can mine with your graphics cards and run masternodes at the same time.
Cut the cost of electricity: relocate or go solar
The last option is to optimise the electricity side. If you pay for electricity in France, around 18 cents per kWh at the time, relocating your farm to a country where a kWh costs 6 to 8 cents brings you down to 9 or 10 cents, management fees included. Many installations are being set up in the United States, particularly in Texas, and there have been some in Kazakhstan. Another solution: mining farm projects equipped with solar panels, which are starting to become attractive given the price of electricity in France.
For us, one thing is certain: mining has to remain profitable. Without miners there is no more hashrate on the network, the cryptocurrency is no longer secure and ends up disappearing.
What about today?
Ethereum moved to proof of stake on 15 September 2022 (the Merge): mining Ethereum with graphics cards came to an end and GPU mining income collapsed. In 2023, the arrival of Kaspa ASICs then made Kaspa GPU mining marginal. Of the options in the video, ASICs and lower electricity costs are therefore the ones that remain most relevant today.
To switch to ASIC mining, browse our ASIC miners. Electricity too expensive at home? Our miner hosting lets you run your machines elsewhere. For the follow-up to our solo mining test, read our report Solo mining Ergo, or contact us for advice.
This article summarises the content of the video and is not investment advice.